GREAT ESCAPE TO TAX HAVEN
- Great Escape to Tax Haven
- The birth of the City of London
- The Knights Templar and their banking legacy
- Merchant Adventurers
- Bank of England – pirate initiative
- The rise of the merchant bankers
- Switzerland as major tax haven
- Vatican as tax haven
- Back to London
- Singapore - South-East Asian’s tax haven
- Panama – tax paradise for the American corporate giants
- International trustees in bankruptcy of Russia
- London protests
- First leaks - Panama Papers and again the City of London
- All roads lead to the City of London
Great Escape to Tax Haven
Majority of the corrupted European politicians, as well as global corporate elites, have their money located in companies that are registered offshore. This system guarantees them anonimity and possibility of avoidance of tax on their profits in their home countries, causing massive damage to nation-states economies, social justice and equality. The key word is TRUST which is a legal structure that can operate a network of shell companies, successfully hiding the true identity of the owners and beneficiaries. The system facilitates money-laundering on a mass scale, which in turn breeds political corruption, drug and arms trade and human trafficking, and all sorts of criminal activity around the world.
The global system of tax avoidance is sustained by a successful co-operation between major banks, accountancy and law firms, as well as politicians who create a legal framework within which this system can operate. Thus, the history of tax avoidance is closely linked with the history of banking and law and transnational crime, and dates back to the foundation of the City of London.
The birth of the City of London
This story began in Roman times and the birth of the trading port at the River Thames called Londinium. The city attracted merchants, money-lenders and all sort of adventurers from Europe becoming the financial centre of the Roman province called Britannia.
Rather than a garrison town, Londinium was a trading post, which grew spontaneously near to the crossing point of the Thames, financed and built by the merchants and money-lenders who flocked from abroad. Roman senator and historian Tacitus described Londinium by saying that it “did not rank as a Roman settlement, but was an important centre for businessmen and merchandise.”
After the fall of the Roman Empire in the 5th century CE, the British Isles were overrun first by the Germanic tribes: Angles, Saxons and Jutes and then by the Vikings, the Danes and the Franco-Normans. In 1066, the Franco-Normans led by William the Conqueror invaded British shores and marched inland re-possessing land of the Anglo-Saxon elites.
One of few places that had not been conquered by the Franco-Normans was the strongly fortified City of London. Its citizens agreed to accept the authority of the new King on condition that the King would accept the old privileges and independence of the City of London. Thus, after his coronation, William the Conqueror granted the City of London a charter, which expressed new king's goodwill to 'all the citizens, French and English' and which confirmed the City's 'laws and customs as they were in King Edward's time.' This meant that the city-dwellers were not under the control of a feudal lord and were empowered to run a business and own a property.
Thus, the City of London was tax-exempt and operated as a syndicate of tradesmen with evolving civic government and representative assembly, which predated English Parliament.
The Knights Templar and their banking legacy
In the early Middle Ages, the City of London became the headquarter of the Knights Templar Military Order which was fighting against Muslims in the Holy Land. With support of the Pope and Church, the Templars acquired land and raised castles in Europe and the Middle East. During their expeditions the crusaders struck an alliance with the merchants of Genoa and Venice who assisted them with their fleet but also provided them with the maps which helped them to make a breakthrough discovery near the ruins of the Temple of Solomon in Jerusalem. After many years of excavations, the crusaders found ancient maps and manuscripts which contained secret knowledge on sacred geometry, kabbalah, architectural engineering and teachings on the nature of God and universe. Soon, they hired masons to build monumental cathedrals across Europe, most famously in France. They also maintained their own fleet, raised armies and established the first banking system in Europe by developing the system of credit notes and book keeping.
The crusades also brought an important development in the English law. During the crusades, the landowner conveyed ownership of his lands to entrusted person to manage the estate in his absence and pay and receive feudal dues. This is how the legal institution of TRUST was born that would play important role in modern tax-avoidance.
The Templars loaned money to the kings and engaged in various wars. In the Iberian Peninsula they helped to repel Muslim invaders and establish an independent kingdom of Portugal. In England, they brokered famous Magna Carta in 1215, which limited the power of the English king, granted rights to the barons and confirmed the old privileges of the City of London.
In time, the Templars grew incredibly powerful and were above any secular or ecclesiastical jurisdiction. They were accused of heresy, practising Kabbalistic Gnosticism and engaging in homosexual acts. In 1307, Pope Clement V, acting on the initiative of the French king Philip IV, who was indebted to the Templars, issued the papal bull which instructed all Christian monarchs in Europe to arrest all Templars and seize their assets.
The Templars found refuge in Switzerland, Portugal and England, vowing to avenge the murder of its Master, Jacque de Molay, and persecution of the Templar Order.
In Switzerland, the Templars helped the local communities to fight the powerful House of Habsburgs, and when the conflict ended they laid foundation for the banking system that becomes pre-dominant industry in Switzerland.
In Portugal, where they helped to repel Muslims, they turned into the Order of Christ that sponsored a number of Portugal's most well-known explorers. For a number of years, most of Portugal's early kings would be Grand Masters of the Knights of Christ.
In England, where they were the counselors, treasurers and royal guards of the English kings, they preserved their heritage in the Middle Temple in the City of London, which was turned into a legal training institution for the English lawyers. English law and banking would soon become a major instrument in the hands of the City’s merchant elites.
In the late 15th century came the era of maritime expeditions. As the Ottoman Turks expanded their dominions in the Middle East closing the traditional trading routes that led to India and East Asia, the merchants from Venice, Genoa and other Italian city-states flocked to Catholic Spain and Portugal to participate in maritime adventures, in search for new alternative maritime routes to India. Many of these merchants discovered new lands where they set up a business model based on slave-trade and plantation economy. After their expulsion from Spain and Portugal by the Christian rulers they moved to the Netherlands helping the Dutch to establish independent merchant republic and a prosperous Dutch Empire based on exploitation of overseas colonies.
Due to the instability of the European Continent, these merchants soon moved to the City of London. The City merchants, acting through their legal agents at the Royal Court, persuaded the English king to get rid of the wealthy and influential Catholic Church from England and expriopriate its land. The man who oversaw this process in England, Thomas Cromwell, was a mercenary working for the Merchant Adventurers, a branch of the Worshipful Company of Mercers, the prime livery company in the City of London.
A number of companies were set up in the City of London, most notably the Muscovy Company which traded with Muscovites, the East India Company which looted India and Virginia Company which established first English settlements in North America. Majority of the English explorers were associated with the Middle Temple, former headquarters of the Knights Templar. Middle Templars possessed knowledge of law, administration and government, which were vital in conquest and colonisation of new lands. Therefore, maritime and legal members interacted and collaborated in promoting overseas trade and colonization. For example, Francis Drake, the most famous English pirate, was a member honoris causa of the Middle Temple and a member of the Inner Temple.
Wherever these City merchants went, they committed crime, killing indigenous communities and expropriating their land. Although slavery existed in ancient times, the merchants of the City of London were the first to set up a new state in Northern America that was soley based on the work of slaves and indentured servants.
Bank of England – pirate initiative
In order to credit maritime expeditions, transatlantic slave trade as well as king’s wars with Catholic France, a group of City merchants and pirates decided to form a private bank. The concept was bor-rowed from the Bank of Amsterdam, which became highly profitable for the city by providing loans to the merchants, minting coinage, stabilizing the economy and facilitating trade. The government introduced the bill in 1694 and established Bank of England. The Bank was given exclusive po-ssession of the government's balances and was the only limited-liability corporation allowed to issue bank notes. The particular novelty was that there was no fitted time period for the loan and that the interest would be paid in perpetuity. In effect this meant creation of national debt, which ever since grew inexorably. In this first official act of the world's first central bank can be seen the grand pretense that has characterized all those which have followed. The Bank pretended to make a loan but what it really did was to manufacture the money for government's use. The creation of the Bank of England was combined with the introduction of the effective law of taxation, which made possible the servi-cing of a public debt.
The money lent by the Bank of England to the English merchants helped Britain to subvert the rival Catholic empires in Europe in particular France, Spain and Polish-Lithuanian Commonwealth. This was successfully carried out by forging international alliances, especially by supporting protestant state of Prussia and extending control over orthodox Russia.
The rise of the merchant bankers
The fall of the Catholic states in Europe was concurrent with the rise of the Rothschild family. In the early 19th century, chief banker in the City of London, Nathan Rothschilds, helped the coaltion of Britain, Prussia, Russia and Austria to defeat Napoleon Bonaparte and establish new order in Europe where Christiany would cease to be the state religion. Throughout the 19th century, all three autoritarian states borrowed money from London to sustain their armies and surpress freedom movements in the countries which they occupied.
At the same time, the Rothschilds, who were advisors to the Bank of England and other central banks in Europe, helped to build the British Empire, the French Empire and the German Reich, by means of colonial exploitation and foreign investments, often waging wars for commercial profit. Most precious metal, over which they waged wars, was gold, as it was needed to back up British pound and sustain Gold Standard.
The rising competition between the British Empire and German Reich led to the First World in 1914. When the conflict reached stalemate, the Jewish bankers in the City of London and Washington D.C. were instrumental in shifting the balance in favour of Britain and France having been promised Palestine by the British government, for the Jewish settlement, and the possibility of the exploitation of the oil-rich Middle East.
At the same time, the same Jewish elites were financing communist revolutionaries to abolish tsardom and take control of the Russian government and ultimately Russia’s vast natural resources.
When the bankrupt and defeated Germans realised they were outwitted, they started their anti-Jewish retoric, agitating for the revision of the Versailles Treaty and for the fight against communist ideology and its Jewish agents in Europe.
The Jewish banking elites in the City of London and Washington D.C. saw an opportunity for themselves in financing both regimes, Nazi-Germany and Soviet Russia, although they had different agendas. The Rothschilds were primarily focused on building Soviet Russia, as new model of classless society that would be their subordinate business partner. Meanwhile, the elites in Washington D.C. were determined to create a major military conflict that would allow the corporate elites of the United States to make money and to step into the war at the crucial moment and emerge as a new balancing power in the world. Both, the elites of the City of London and Washington D.C. were equally determined to use anti-Jewish retoric of Nazi-Germany to force German educated Jews to emigrate to Palestine.
Bank of International Settlements (BIS) with a base in Basle, Switzerland, was created officially to administer the remaining German reparations payments but with undercover purpose to channel more funds to rebuild Germany's military-industrial complex. BIS's founding members were the central banks of Britain, Germany, France, Italy, Belgium, a consortium of Japanese banks and consortium of American commercial banks: J.P. Morgan, Morgan-affiliated First National Bank of New York, and the First National Bank of Chicago. The bank’s key architects were Montagu Norman, the governor of the Bank of England and Hjalmar Schacht, the president of the Reichsbank. The BIS's first president was the old Rockefeller's banker, Gates W. McGarrah, formerly chairman of the Chase National Bank and New York Federal Reserve.
Switzerland as major tax haven
The banking fraternity, the institution of TRUST and the country of Switzerland were crucial in chanelling money and gold from German-occupied states in Europe during the Second World War.
The money and gold stolen from European countries by the Nazi-German criminal enterprise was laundered mainly through Swiss-based Bank of International Settlement and Swiss-based banks.
Although declared a neutral country, Switzerland co-operated with Nazi Germany on multiple levels. This cooperation dated back to the 1920s, when Germany began to outsource its armament production to circumvent the terms of the Treaty of Versailles. Consequently, Krupp operated in Sweden, Fokker in the Netherlands whilst Siemens, and other German companies established plants in Switzerland. In this period numerous finance and holding companies sprang up in Switzerland. A classic example was IG Chemie which was set up in Basel by the IG Farben Group in 1928/29 as a finance and holding company for German chemical giant's international possessions. Shortly before the invasion on Poland the executives of I.G. Farben provided special advise in terms of camouflaging German foreign holdings. In March, 1939 the chairman of I.G. Farben's legal committee, August von Knierem, circulated a report advising to camouflage Farben's foreign holdings by transfer of shares or similar interest to Germans residing in neutral countries or other trustworthy persons. The camouflaged German branches helped the Nazi-Germans to maintain access to American markets despite British dominance in the Atlantic. Thus, the institution of TRUST was an essential element in the hiding of German capital.
BIS had played a fundamental role in laundering gold that was looted by the Nazi-Germans from the occupied countries which BIS accepted as payments on loans Germany had obtained from BIS prior to the war. The British and German directors served together on the board of BIS throughout the war. The recipient banks of Nazi gold were also: Swiss National Bank in Bern, BIS, Union Bank of Switzerland and Swiss Bank Corporation (present-day UBS Group AG), which worked closely with Dresdner Bank, as well as Crédit Suisse, which worked closely with Deutsche Bank. The Swiss banks also granted loans to German corporations, such as I.G. Farben, and facilitated German trade in securities such as shares in Royal Dutch Shell. The gold that had been deposited at Swiss banks then flowed to other central banks, whose countries sold strategic resources that the Nazi Germany needed for its war machine. Major net purchasers were Portugal and Spain, Romania, and to the lesser extent Hungary, Slovakia and Turkey.
Vatican as tax haven
The Swiss banks often acted as an intermediary whilst the escape route led via the Vatican bank.
On December 13, 1941, U.S. President Franklin D. Roosevelt granted a general licence to the U.S. Treasury run by two American-Jews, Henry Morgenthau and Harry Dexter White, to issue a licence that would permit trading that was generally prohibited by the Trading With The Enemy Act. One of the U.S. Treasury's actions was to issue a general trading and business licence to 'The Roman Curia of the Vatican City State’. To keep Church financial transactions secret, Vatican’s Jewish banker Bernardino Nogara came up with a concept of the Vatican’s own bank, which he created in 1942 and named Istitutio per le Opere di Religione, in short IOR – otherwise known as the Vatican Bank. The Vatican Bank could operate anywhere worldwide and did not pay taxes and was only accountable to the pope. Like Bank of International Settlements in Switzerland, it had no accountability to any national government and became a conduit for German Nazi capital that fled Italy and other European countries, including Germany, into a dozen of countries on several continents, under the cover of the church property. Large part of money looted in Europe ended up in the U.S. Federal Reserve and Bank of England.
Back to London
More than a decade after the Second World War, in the 1960s, the Rothschilds and the Warburgs supported European Union project by issuing Eurobonds. Siegmund Warburg and his colleagues had to defang the taxes and controls designed to prevent hot money flowing across borders and find ways to pick and choose different aspects of different countries’ regulations for the various elements of their creation. The cumulative effect of this jurisdictional game was creation of a bond paying a good rate of interest, on which no one had to pay tax of any kind, and which could be turned back into cash anywhere. The main buyers of these bonds were individuals, usually from eastern Europe but often also from Latin America, who wanted to have part of their fortune in mobile form so that if they had to leave they could leave quickly with their bonds in a small suitcase. Through these operations the City of London had started to recover its role as a financial centre of the world, at the same time pioneering the modern concept of tax havens.
Singapore - South-East Asian’s tax haven
Whilst the elites of the City of London lost their colonies in South-East Asia, they attempted to retain foothold in the area, often training elites who then became key political leaders of these nations. Among them was Lee Kuan Yew, a Singaporean of Chinese ancestry, who read law at Cambridge University, attended London School of Economics and became barrister of the Middle Temple. In Singapore he set up his own legal practice, Lee & Lee and his own pro-independence political party, People's Action Party (PAP) joining forces with Chinese students and unionists with communist sympathies. In 1958, Lee Kuan Yew helped to negotiate in London for an independent Singapore state with London retaining influence over foreign policy and defense. When a short-lived union between Singapore and Malaysia collapsed in 1965, President Lee Kuan Yew tapped his colleague Edmund Barker from his law firm, Lee & Lee, to join his cabinet. Edmund Barker, a barrister of the Inner Temple, became Minister of Law and drafted the Proclamation of Singapore in 1965 announcing Singapore's separation from Malaysia. In order to attract investors and boost Singapore's economy, Lee Kuan Yew agreed to turn Singapore into a South-East Asian’s tax haven, adding it onto the list of countries that specialised in financial services, thus facilitating money-laundering on a global scale.
Panama – tax paradise for the American corporate giants
Singapore was followed by Panama. In the 1970s, the elites of Washington D.C. came to the conclusion that turning the canal over to Panama was essential if the United States was to maintain a climate to continued American investments in Latin America. After series of negotiations, the leader of Panama, general Omar Torrijos, agreed to reorganize Panama's new banking laws on condition that Panama gains control of Panama Canal after 1999. Consequently the American largest banks, including those which made money on financing Nazi-Germany such as Rockefeller's Chase Manhattan, brought with them to Panama over $8 billion of assets and promises of money to general Torrijos who needed to consolidate his power.
In the following years a string of islands in the Caribbean, mostly under jurisdiction of the City of London elites, joined the growing list of tax havens around the globe, becoming refuge for money obtained through criminal activity.
International trustees in bankruptcy of Russia
In the 1990-ties, the money obtained fraudulently in post-Soviet Russia and other former Soviet states, as well as post-communist countries in Central and Eastern Europe was subsequently located in the City of London, in the United States and in various off shore bank accounts which provided anonymity. Contrary to the European countries, the United Kingdom and the United States permitted anonymous acquisition of properties, facilitating mass money-laundering.
The Russian oligarchs and other corrupted politicians from Europe and elsewhere often chose the City of London or its satellites: the Isle of Man, the island of Jersey, and the Island of Guernsey, to hide their money that came from criminal activity. There were also the Queen's overseas territories which were tax havens, including the British Virgin Island (BVI), the Cayman Island, Gibraltar and the sovereign territories of Antigua and Barbuda, the Bahamas, Barbados and Belize.
The City of London offered unrivalled tax avoidance system that dated back to Britain's colonial times. Since 1799, the British government permitted their colonial elites to claim they were 'domiciled' abroad, so that they could avoid payment of taxes on their overseas property. That rule survived into the twenty century when the UK foreigners or even British citizens who were born in the UK, could claim they were 'domiciled' abroad, thus avoiding the payment of taxes on their overseas income unless it was remitted to the UK. Furthermore, British government provided further concessions for wealthy individuals. By purchasing a property through offshore TRUSTS, foreign buyers could avoid both capital gains tax when they sell the property and most of the stamp duty usually paid at initial purchase. Also, a company that operated in the UK but was registered in an off-shore TRUST avoided payment of income tax on its dividends.
In 1996, the Conservative government of John Major had introduced a new 'investor visa' for those wanting to make Britain their main home and able to invest at least £1 million in the country. The looted money were located in real estate, bars, restaurants, galleries, nigh-clubs and casinos across London. Those investing in this way were, after five years, allowed to apply for permanent residency and eventually UK citizenship. During this period, many British lawyers like Stephen Courtis made huge fortunes on assisting Russian-Jewish oligarchs like Boris Berezovsky and Mikhail Khodorkovsky, in money laundering through off shore accounts.
Significant amount of money channeled from Russia and former Soviet states had been invested in the real estate in the United States. The process was facilitated by the Soviet Jews who emigrated from Soviet Russia and Ukraine to the United States in the aftermath of Jackson-Vanik amendment, in late 1970-ties. They had regular contacts with KGB and engaged in money-laundering and other illegal activities, primarily in New York City.
Apart from the United Kingdom and the United States, the countries that were particularly accommodating of the criminal money were Switzerland, Lichtenstein, Luxembourg, Monaco, Netherlands and Israel. Cyprus, a former British colony, was also very welcoming, giving the Russians EU passports in return for investments. For example, Mikhail Cherney, a Russian Jewish businessman who held majority stakes in Russia's aluminium smelters (before he was forced to sell them) and who was accused of links with serious organised crime, used Cyprus bank to send money to associates of Avigdor Lieberman, future Israeli Minister of Foreign Affairs, Israeli Deputy Prime Minister and Israeli Minister of Defence.
In 2011, thousands of people occupied the front of St Paul's Cathedral in the City of London to protest against tax avoidance on part of various businessmen and corporations. One of the City’s businessmen accused of tax avoidance was Philip Green, key advisor to Prime Minister, David Cameron. In 2000, he purchased the British Home Stores (Bhs), Britain's fifth largest retail chain, from struggling Storehouse Plc for £200m. He re-organized the company and in May 2001, announced that profits had increased to £31.5 million, which he called 'The steal of the century'. A year later, the profits had risen threefold, the highest level in the company's history. The three of the four shareholders in Bhs were based in offshore tax havens, the British Virgin Islands and Jersey, thus escaping income tax on dividends. Then in 2002, Philip Green took over Arcadia, which owned Top Shop, Burton and Dorothy Perkins, using a company based in Jersey. Within 24 hours from purchase, the company was transferred into his wife's name, who was a resident of Monaco.
The protesters at St Paul’s Cathedral were eventually evicted by the Court of Appeal presided over by Lord Neuberger, an honorary Fellow of the Royal Society and former merchant banker at N.M. Rothschild & Sons. The Guardian Newspaper wrote at the time:
“...The City has exploited this remarkable position to establish itself as a kind of offshore state, a secrecy jurisdiction which controls the network of tax havens housed in the UK's crown dependencies and overseas territories. This autonomous state within our borders is in a position to launder the ill-gotten cash of oligarchs, kleptocrats, gangsters and drug barons.(...) No wonder priests are resigning over the plans to evict the campers. The Church of England is not just working with Mammon; it's colluding with Babylon.”
(George Monbiot, “The medieval, unaccountable Corporation of London is ripe for protest”, The Guardian, 31 October 2011)
First leaks - Panama Papers and again the City of London
In the early 2015, few months before the next British parliamentary elections, there was a massive leak of files, obtained through an international collaboration of news outlets, which showed that HSBC's Swiss branch, HSBC Private Banking Holdings (Suisse) SA, was helping more than 100,000 clients from over 200 countries to evade tax. The leak showed that HSBC (which made money on trading opium in China) provided bank accounts to international criminals, corrupt businessmen and politicians, people connected to African corruption scandals (including blood diamond trading), arms industry figures and many others. It had, for example, laundered hundreds of millions of dollars for the world’s biggest crime syndicate based in Mexico, Sinaloa Cartel, which was responsible for the death of at least 100,000 people.
In spring of 2016, there has been another leak of information from the database of the world’s fourth biggest offshore law firm, Panama-based Mossack Fonseca. The leak disclosed for the first time the hidden network of offshore tax havens which operated in great part under British jurisdiction that helped thousands of politicians, celebrities, businessman, bankers and criminals from across the world hide and multiple their profits. The leak also reminded of the story of a secret co-operation between Nazi-Germany and the elites of the City of London and Washington D.C., for the company that was at the centre of the affair, Mossack Fonseca, was co-founded by Jürgen Mossack, son of a former Nazi-German, Erhard Mossack, who served as a senior corporal in the Waffen SS during the Second World War. After the war, Erhard Mossack moved to Panama, where he offered to spy for the CIA on the communist activity in Cuba. His son Jürgen earned a law degree in Panama and practiced law in London before returning to Panama in 1977.
The leak had showed that half of all companies that were set up by firms like Mossack Fonseca were registered in British-administered tax havens, as well as in the United Kingdom itself. British Virgin Islands were most popular holding more than 100,000 companies. Mossack Fonseca acted on instructions from intermediaries usually accountants, lawyers, banks and trust companies that were concentrated in Switzerland, Jersey, Luxembourg and the United Kingdom.
Most importantly, the banks who were involved in registering shell companies offshore were exactly the same banks or their successors in title, that were money-laundering Nazi-German gold or had other criminal record such as Credit Suisse, Swiss UBS, and Deutsche Bank. Rothschild Trust Guernsey Limited had also taken part in incorporation of offshore trusts. Many of the companies registered offshore dealt with mining, oil and gas, arm deals, human and drug trafficking, in other words these banks were facilitating criminal activity. Mossack Fonseca’s files revealed offshore companies dealing with petroleum and gas in 44 of Africa’s 54 countries siphoning off billions of dollars each year, leaving people in poverty and destitute.
In the United Kingdom members of the House of Lords, former Conservative MPs and dozens of donors to British political parties have had offshore assets.
The largest donor of UK Independent Party, Arron Banks, was also on the list as shareholder of a company registered in the British Virgin Islands called PRI Holdings Limited, which was a sole shareholder of African Strategic Resources Limited, a BVI firm managed in Gibraltar. Even the British Prime Minister David Cameron and the British Royal Family featured in the Panama Papers leak. David Cameron's father, Ian and “his company Blairmore Holdings avoided UK tax by hiring Bahamas residents – including a bishop – to sign paperwork.” Furthermore, British Prime Minister David Cameron, who benefited from these operations, appointed chair of HSBC, Stephen Green, trade secretary in 2011. Seven Tory donors had bank accounts in HSBC Swiss subsidiary.
When in 2013 the EU authorities announced the implementation of laws which aimed to strengthen the fight against tax fraud and tax evasion, the interests of many Conservative donors were under threat. Consequently, some members of the Conservative Party started to support the rhetoric of the UK Independent Party that United Kingdom should leave the European Union.
Britain’s allied colonial power, the Netherlands, had also served as facilitator of tax avoidance. Multinational corporations such as Google, Netflix or Ebay, were using Dutch subsidiaries to drastically lower their tax payments. 59 of British Petroleum’s subsidiaries were based in the Netherlands. Subsequent research conducted by the University of Amsterdam confirmed that two former colonial powers, the Netherlands and the United Kingdom, were “conduits for 37% of money heading to tax havens, most of which have strong links to Britain”.
All roads lead to the City of London
After the Panama Papers leak, some clients of Mossack Fonseca simply transferred their companies to another global trust and corporate administrator with a major office in London. In other words, the system remained intact.
As the information became hot subject in the media, the European elites, who, also happened to be on these lists as beneficiaries of the system, announced that they would introduce more transparency and regulation over the tax avoidance and tax havens, but after a period of time, the affair was swept under the red carpet.
In 2021, there was a further leak – Pandora Papers – that, confirmed, in the words of a Guardian journalist ‘...the central coordinating role London plays in the murky offshore world.’
Thus, the banking elites of the City of London, who had been the source of wars and revolutions in in the last three centuries, creating poverty, destitute and misery on a global scale, are also the godfathers of modern tax avoidance, weaving the invisible web of legal, financial, intelligence and political network that spans the entire globe.
The richest individuals and corporations, whose fortune sprang up thanks to the system set up by the banking elites of the City of London and Washington D.C., exploit estate tax loopholes, shell corporations, trusts, and other sophisticated methods to shield their accumulated fortunes from taxation, thus multiplying their fortunes on an enormous scale, at the same time shifting the tax obligations onto lower classes of society and putting a strain on the national budget. At present time, America’s 20 richest people own more wealth than the bottom half of the rest of the population combined, and their wealth is rapidly increasing every year thanks to the use of the tax haven global web...