Pandora Papers: Major World Leaders—King Abdullah II, Tony Blair, Andrej Babis—Accused Of Secretive Offshore Financial Dealings

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Siladitya Ray   Forbes U.S. Staff

Pandora Papers: Major World Leaders—King Abdullah II, Tony Blair, Andrej Babis—Accused Of Secretive Offshore Financial Dealings

Photo: Giorgio Trovato/ Unsplash

Hundreds of world leaders, politicians, billionaires and celebrities have used secretive offshore bank accounts and shell companies to hide billions of dollars from tax authorities in their countries, according to leaked documents called the “Pandora Papers” that were analyzed in an investigation carried out by 150 media outlets across 117 countries, a finding that follows up on the similar 2016 investigation know as the “Panama Papers.”

KEY FACTS

- The investigation reportedly found advisers helped Jordan’s King Abdullah II set up at least three dozen shell companies between 1995 and 2017—enabling the Middle Eastern monarch to buy 14 homes worth more than $106 million in the U.S. and the U.K.

- Czech Prime Minister Andrej Babiš reportedly used shell companies to secretly purchase a $22 million chateau in a hilltop village near Cannes, France, the investigation found.

- The revelation comes just days before the billionaire politician—who has cast himself as a populist rival to Europe’s elite—faced a national parliamentary election.

- According to the investigation, former British prime minister Tony Blair and his wife Cherie Blair avoided paying property taxes on an $8.8 million London office building they acquired in 2017 by buying shares in a British Virgin Islands company—owned by the family of Bahrain’s industry and tourism minister Zayed bin Rashid Alzayani—that held the property.

- The investigation named several members of Pakistan Prime Minister Imran Khan’s cabinet and inner circle who have reportedly stashed away millions of dollars of hidden wealth in an array of offshore companies and trusts.

- The revelation could turn out to be a major embarrassment for Khan, who had campaigned for office as the head of a reformist party leaning on a strong anti-corruption agenda.

- The uncovered documents also show that Azerbaijan’s ruling Aliyev family in recent years had traded U.K. property worth close to $540 million including a nearly $91 million London property sold to the Queen’s crown estate, a revelation that has prompted an investigation by the British monarch’s estate

SURPRISING FACT

While many of the alleged shell companies and offshore accounts are located in places like the British Virgin Islands, Seychelles, Hong Kong and Belize, the Washington Post—one of the papers involved in the investigation—noted that the most “troubling revelations for the United States” centered around the complicity of some U.S. states in the offshore economy. The Post notes that South Dakota, Nevada and others have adopted financial secrecy laws that rival those of several infamous tax-havens. The papers show that a former vice president of the Dominican Republic finalized several trusts in South Dakota to store his personal wealth and shares of one of the country's largest sugar producers.

TANGENT

The papers also revealed that Svetlana Krivonogikh—who’s alleged to be a former mistress of Russian President Vladimir Putin and the mother of his 18-year-old daughter—purchased a $4.1 million apartment in Monaco just weeks after she gave birth in 2003. According to the investigation, Krivonogikh owns a shell company in the British Virgin Island and she used a Monaco financial services firm that simultaneously worked for one of Putin’s billionaire friends. Putin’s alleged relationship with the former cleaner was first reported by the Russian outlet Proekt last year, which found that she had amassed a large portfolio of assets in Russia. Krivonogikh’s daughter has fanned speculation that Putin is her father in interviews and capitalized on her growing notoriety on social media. According to investigations carried out by Proekt, no father is named in Rozova’s official Russian documents but they do mention her middle name as  “Vladimirovna”—which means “daughter of Vladimir.”

CRUCIAL QUOTE

Reacting to the Pandora Papers’ revelations, Oxfam International, a British consortium of charities, said: “This is where our missing hospitals are. This is where the pay-packets sit of all the extra teachers and firefighters and public servants we need. Whenever a politician or business leader claims there is ‘no money’ to pay for climate damage and innovation, for more and better jobs, for a fair post-COVID recovery, for more overseas aid, they know where to look.” Oxfam also noted that tax havens cost governments around the world $427 billion each year.

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Siladitya Ray   Forbes U.S. Staff

I am a Breaking News Reporter at Forbes, with a focus on covering important tech policy and business news. Graduated from Columbia University with an MA in Business and Economics Journalism in 2019. Worked as a journalist in New Delhi, India from 2014 to 2018.