1312 points by pseudolus 1611 days ago | 594 comments on HN
| Mild positive
Contested
Editorial · v3.7· 2026-02-28 07:48:25 0
Summary Transparency & Accountability Advocates
The Guardian's Pandora Papers investigation employs investigative journalism (19 journalists) to expose offshore financial schemes used by billionaires, world leaders, and officials to conceal wealth globally. Content strongly engages Article 7 (equality before law), Article 19 (free expression/information), and Article 21 (participatory governance) by publishing documented evidence enabling public and regulatory accountability. Coverage is undermined by tension with Article 12 (privacy) — publishing leaked private financial data — though editors justify this through public interest in corruption/tax evasion exposure. Overall framing advocates for transparency, fair international financial order, and accountability of the powerful.
For those wondering how this compares to Panama and Paradise Papers, those were leaks from mostly one company. This one includes 14 spread across many jurisdictions.
Some of the people who defend the ultra-rich are also the ones who claim to be in favour of free markets. A small bit of economic orthodoxy is that for free markets to work, parties need to be informed (and externalities priced in, but that's another story). This is not just in terms of "this is the price of bananas" but also in terms of knowing eg what various salaries are, which businesses are profitable, etc.
How can we have free markets when we don't even know who owns what?
As for taxation, there needs to be an overhaul. Things need to be simpler, and I say this as someone who has used international tax advisors. There's no reason the tax guy's diagram of your business should be more complicated than your own diagram. Moving profits to other countries shouldn't be possible, or rather, it should be more fixed by the nature of the business than by the desires of the CFO. We simply hear too much about "selling IP rights" to subsidiaries and similar schemes that are clearly meant to lower tax rather than increase revenue. Granted some things will be legitimate, but it's important that some vague concept of fairness is adhered to. This again goes back to transparency. We invented corporations to help improve society, so we ought to know what kinds of things people are doing with them.
Edit:
Perhaps the way to see it is, if you say "we make money by selling coffees in the UK" you would expect that entity to report a tax structure that contains a bunch of coffee and UK related entries. Reporting to investors ought to mirror reporting to the taxman.
I guess just like the Panama papers, leading journalists will be killed, investigations stop being reported in mainstream media, and the world goes quiet again with nothing changing.
On superficial reading, this story conflates tax minimization with cases of corruption.
Corruption means a politician becoming wealthy in an inappropriate way from their position of power. Even if they were to pay taxes this is still a huge negative for society. Wherhers it's the president of Azerbaijan or Nancy Pelosi, it's should rise to the level of criminal enrichment if properly investigated.
On the flip side are people who made their money legitimately and employ legal strategies available to them to minimize their tax bill. I have a hard time moralizing this because we all do it. Be it writing off donations, using tax loss harvesting, holding on to investments just long enough to not trigger capital gains taxes, etc - we all use strategies available to us to pay no more tax that we have to. I would expect nothing else from a more wealthy person. I would be totally fine if society made moves to close loopholes but I can't blame people for leveraging loopholes that exist because we should all do that.
What I see here is tax evasion. But done in a roundabout legal loopholish kind of way.
1. Establish profitable company in your home country.
2. Establish 2nd company in a tax haven country.
3. Give 2nd company some kind of ownership, and then pay rental fees, licensing fees, or simply set up a high interest loan that the 2nd company loaned the first.
4. Once you set up a way to make it look like you owe the 2nd company tons of money, now your 1st company no longer is "profitable" and actually in debt losing money, which means it doesn't need to pay taxes on the massive profit it's making.
While I believe it's legal it hinges on bad ethical practice. But many large companies do this, such as cruise ships and I think Apple.
In Canada, shell companies -- run by the owner's lawyers -- can hold property and there is no way to trace the property back to the original owners. The courts have found that the lawyers cannot be compelled to divulge the property ownership under lawyer-client confidentiality.
It is kind of insane that this is even allowed. How do you plan to tackle money laundering, corruption, and transparency when you cannot even figure out who owns the property in the first place?
Another leak that will have people "outraged" by aggressively upvoting and commenting on articles for two weeks. The news cycle will move on, the leakers will be car bombed [0], and these papers will be memoryholed.
You can wait around for four years til a new set of old rich people get voted into power (maybe they'll be blue/red this time!!!!) and hope they get rid of the loopholes they all use. Maybe a couple more """revolutionary""" politicians will be elected who VERBALLY DISMANTLE AND DESTROY a couple billionaires in a senate hearing (OMG SO AWESOME!!!). Decide for yourself if you think anything will change.
There does exist a great equalizer, but I won't mention it. I like staying unb&.
I was very excited when Panama papers came out. Intrigued when Paradise papers leaked. But now? Damning evidence of outright crimes came out and nothing happened. In the UK IIRC it was found that David Cameron evaded some taxes via offshore funds, and? He said he’s very sorry and didn’t mean to, and that was it.
Everyone knew before and after the rich don’t pay taxes. We don’t need more evidence, we need action.
I've wondered a lot about this with the Snowden and Wikileaks stuff, and I wonder about it with this topic too: the most salient part of this story, and about Panama Papers etc. before it, is how small a dent it seems to make in the discourse, and in the world as a result. At best, these stories get a good chunk of the airwaves for a couple of weeks, and then it's on to the next thing.
In history books, you get a sense sometimes that there were eras in which stuff like this sent people into the streets in rages. In which governments were voted out or overthrown, in which meaningful legislative responses were made. Or, you know, riots.
But I look around after reading those books and wonder what makes us so different. It's weird to live in this era. I read a Guardian article like this and look at the staggering sums, this entire "shadow financial system" devoted solely to one notion: I'm going to take as much as I can, in whatever way that I can, regardless of legality, and I'm going to give nothing back because I sincerely don't believe I owe anything back -- oh, and I'm going to keep it all a secret.
And I look around and not only don't see any riots; I sometimes get the feeling that people are actually envious, sometimes even respectful of the ingenuity it takes to manufacture these schemes. It's tough.
The only silver lining I can think of is what all the secrecy says: we're not just doing this in the open because we're still afraid we'll end up like the Romanovs if too many of you get angry. I think that while they're still afraid, there's still some hope.
EDIT: Reading some replies. It's weird to have to say this to such a smart crowd, but I'm not advocating riots as such; I'm advocating a substantive response. Of course riots are "bad" in some sense, but my observation is really about the odd contrast between the huge size of the "stimulus" (theft of wealth, much of it yours, on a staggering scale) and the tiny size of the "response" (newspaper articles and web forum discussions), especially when contrasted with other historical periods. So while I wouldn't "want a riot", seeing one would make me go "well, that makes sense".
The thing with all of these is that the rich people are probably just as surprised as you are to show up in these leaks in most cases.
When you get barely rich, like single digit millions, the banks will start to offer you "family office" services. They basically just take care of everything for you. You send them all your money and all your debts (even your phone bills and stuff), and they promise to make sure there is more at the end of the year than the start. They invest for you, they do accounting and file taxes for you. You give them limited power of attorney so you don't even see the tax forms.
If you ask how it all works, they tell you it's really complicated and you should just focus on doing whatever it is that made you rich and let them worry about managing the money for you. Sometimes they do ethical stuff, sometimes not, depending on which bank and which consultant you hire.
I'm not excusing the people who are here, just explaining how some people who you thought were good people end up in these leaks.
A lot of negative comments that this is yet another leak and nothing is going to change.
I see a lot of positives,
Panama and paradise leaks were from one firm, this is from 14 different ones and by far the largest one in terms of number of documents, that's progress.
More transparency is always good , as an immediate impact asset owners like the British crown are now going to be lot more careful who they are buying from, the optics of enabling laundring is quite important for such buyers.
Removing such buyers from the market for dictators will limit who they can deal with making it more difficult and likely less lucrative for them in dealing with property
> For a few hundred or a few thousand dollars, offshore providers can help clients…
Heh this is totally affordable for regular jack offs like me. Perhaps someone will create a public benefit corporation (benefit for the irony), democratize access to these schemes for everyone, draw the ire of government when tax revenue plummets and lead to new laws enacted.
Two conclusions that are leaking about the "rich", like pus from an abscess:
* their abysmal greed and asocial psyche: When you already have billions, what does it matter if you pay any percentage in taxes? How does it have any material or imaterial impact on your quality of life if you contribute back to society a fraction of what it gifted you with?
* their deep fear of the societies they plunder: most people do accept some spread in wealth distribution if it is somehow "legitimate" and "kosher". Hidding their tracks and actions in complex constructions is how to engineer top-heavy, artificial, pyramids of wealth and power that exceed what would be acceptable under the cleansing light of transparency
> We invented corporations to help improve society
I think it's easy to say this, but I'm not sure the history of corporations bears this out. Technically, the first corporations were colonial expeditionary forces (like the Dutch VOC) that were sent to Africa and the Caribbean to control various types of precious resources and we all know what happened there.
I guess it all depends on who "society" is in your statement, because someone has always has to lose in a corporate structure.
> I would be totally fine if society made moves to close loopholes but I can't blame people for leveraging loopholes..
The first step in the right direction, then, is for people to become aware of these highly unsavory (but legal) practices. It's not going to be an easy fight. The kind of people that setup multiple shell companies to obfuscate the ownership of their assets have worked deliberately to extract wealth and game the system to a level that is unimaginable (at least for me before I heard about the related Panama Papers story that broke a couple years ago).
Ultimately, as we approach a global society with insane levels of wealth inequality and where public infrastructure and social safety nets have started to come apart at the seams, it's imperative that these "loopholes" get closed. Otherwise, we're going to be revisiting Feudalism in 21st century western democracies. Sadly some people seem to want that. They see it as a kind of gilded age lords and their servants.
How could you cut off City of London Corp from international financial circuits. Or the Netherlands, which is one big tax paradise even though it may seem it is not. Luxembourg? Don't think that tax heavens are some remote, distant islands governed by some petty lord.
Taxation is really hard to enforce in the modern World. The biggest problem is that small, local companies cannot compete with big ones because they don't have resources to overcome taxation.
For me it make sense more sense to abandon corporate tax at all and make sure that all the resources, public services that company uses in a given country are paid by the company. If company uses trucks, it should pay for roads, etc.
I don't think that Facebook that operates from US and uses US resources and services should pay CIT tax in, say, France. If it uses internet infrastructure, just make Facebook to pay for it fair amount and that's all.
"Free" and "market" are contradictions. Markets exist when individuals can amass capital irrespective of wider social needs, and this necessarily requires armed force, or the threat of armed force, to prevent people from collectively deciding about resource allocation. That's the state. Naturally the state also enforces many things besides ownership of capital, some of them better (like minimum wage and health and safety codes) and some worse. But the point is that even if you had the fantastical and anti-realistic "perfect information", markets wouldn't be "free".
At the same time, markets do "work". That is, the results of market interactions are what you might expect from market interactions: Accumulation of capital in fewer hands, economic cycles of various kinds, some motivation for innovation and lots of innovation for exploitation, war, scams and such...
You call it "economic orthodoxy" but it's really nothing of the sort. There's not even really a technical definition of "free markets" so I don't know where you're getting your assertions.
I think you're kind of gesturing at the concept of "perfect competition", which is rigorously defined and does have technical requirements [0], one of which is perfect information. But it actually doesn't really apply to the tax situation of the owner.
In other words, for political and ethical reasons, there's a lot of reform that can and should be done, but I wouldn't dress up the argument in the form of "economic orthodoxy", unless you're talking about actual economic orthodoxies like lowering corporate income tax and preferring VAT to personal income tax.
edit: I should soften my confidence here, it's been a while since I did economics. At least, I've never heard of transparency extending beyond the good or service being a requirement for perfect competition... do you have a source for that, or can you clarify how it would affect things?
> Once you set up a way to make it look like you owe the 2nd company tons of money, now your 1st company no longer is "profitable" and actually in debt losing money, which means it doesn't need to pay taxes on the massive profit it's making.
Short of a revenue (as opposed to income) corporate tax or VAT, it’s a very tricky problem to address. Maybe an excise tax on foreign remittances to match the highest corporate bracket.
Or you just scrap corporate tax entirely because it’s a terrible idea anyway.
As others on this thread have pointed out, tax laws generally outlaw sham loans, licensing arrangements, etc. When that kind of cleverness works, it usually needs a boost from corruption since the tax laws already exclude it.
What I never understood is, (how) does the money get transferred to the home country eventually? Doesn't it need to do that to have some utility? Otherwise, what's the point of just accumulating money offshore that you can't eventually use where you actually are?
They usually do. Even money parked in remote islands in companies end up as investment in their home countries. Except now with another layer to hide their identity and ability to dodge taxes.
I like the way you view it. A lot of non-rich people do not feel responsible at all for their wealth management. Some get lucky, and are very happy using their extra money to pay people to keep not thinking about this.
> We simply hear too much about "selling IP rights" to subsidiaries and similar schemes that are clearly meant to lower tax rather than increase revenue.
Huh. Made me wonder if advocates of IP reform could claim improved tax sanity as a benefit.
Happily, not an original thought.
Here's the first hit via ddg:
Intellectual Property Law Solutions to Tax Avoidance [2015]
"Multinational corporations use intellectual property (IP) to avoid taxes on a massive scale, by transferring their IP to tax havens for artificially low prices. Economists estimate that this abuse costs the U.S. Treasury as much as $90 billion each year. Yet tax policymakers and scholars have been unable to devise feasible tax-law solutions to this problem.
This Article introduces an entirely new solution: change IP law rather than tax law. Multinationals’ tax-avoidance strategies rely on undervaluing their IP. This Article proposes extending existing IP law so that these low valuations make it harder for multinationals to subsequently litigate or to license their IP. For example, transferring a patent for a low price to a tax-haven subsidiary should make it harder for the multinational to demonstrate the patent’s validity, a competitor’s infringement, or entitlement to any injunctions. The low transfer price should also weigh toward lower patent damages and potentially even a finding of patent misuse. Extending IP law in such ways would thus deter multinationals from using IP to avoid taxes. Both case law and IP’s policy justifications support this approach."
Also...
> How can we have free markets when we don't even know who owns what?
Yup. Open markets require symmetrical information.
"At best, these stories get a good chunk of the airwaves for a couple of weeks, and then it's on to the next thing."
This is the true power of the media. It isn't whatever lies or truths they may tell, though those are impactful in their own way... it is the way they decide what we think about at all. The true power of the media is to inflate some tiny incident that happened to one person to a national-scale, multi-week crisis... and to be able to take national-scale, multi-decade crises and bury them to the point that it's right down there with "conspiracy theories" to think about them.
If you pay attention, you can see this sometimes in action. They'll push a story expecting a certain reaction, but if they don't get the reaction they expect, poof, it's gone. There's always a huge pool of stories to draw from, far larger than they need to send any message they want without having to necessarily lie at any point. They just have to control the spotlight of attention to get the results they want.
Sometimes HN denizens talk about breaking out of the filter bubble. This might be a better way of thinking about it... instead think of it as breaking away from the attention spotlight being pushed on you by the media. Almost the entire world is taking place outside that spotlight.
Step 4 glosses over a ton of details but is sufficiently correct in Apple's case, which pioneered the Double Irish. That was supposed to stop in 2020, but unless you keep up with the world of corporate finance and global tax law, things keep shifting.
Apple's easy to pick on, they're one of the richest companies in the world and should pay more taxes. But for companies that are less successful, it's entirely possible that the second company is actually losing money. Without an appropriately sized army to track through the 200th company (tracking transactions between two companies is simplified to make the tax evasion easy to understand. Real world tax evasion is dramatically more complicated.)
>On superficial reading, this story conflates tax minimization with cases of corruption.
Yes but many of the tax loopholes are just the result of the corruption of power (legal or not). It's only obvious to the people who benefit from it, so no one bats an eye.
E.g. In Denmark, the country’s tax minister cited the Panama Papers to justify hiring hundreds of new employees to bolster the fight against tax fraud.
It was high news and had consequences. There is much work to be done, but 'nothing changing' is not the case.
You do not like that they move money offshore, and that is for a good reason, the super rich have so much resources that they can unilaterally distort the economy. The more concentrated the wealth the more fragile is the economy and the more is dependent on the mood of a few lucky people.
I hear what you're saying, but I don't think anyone is surprised anymore that the rich and powerful are manipulating the financial system. There's also a sort of unreal, weird aspect to these leaks. I get the feeling reading the article that there's either a lot they're leaving out (possibly just because it's too soon for them to have combed through all of the information) or that these leaks are orchistrated in some way to make certain political opponents look bad while other prominent politicians remain un-named and unscathed. I just get a distinct feeling that while yes, this stuff is likely quite true, it's purposely not complete (not blaming The Guardian here, I'm thinking the leakers are maybe leaking selectively).
They mention King Abdullah II of Jordan, but how likely do you think it is that there could or would be any consequences for him? It seems highly unlikely.
Also, they mention that Putin is not named directly in these papers, but we can be pretty certain that he's been involved in all sorts of financial skullduggery. Yes, they say that some of his close associates are mentioned, but even if it can be tied directly to Putin with 100% certainty it would have little to no effect in removing him from power as his power over Russia at this point is too strong for such allegations to have any effect.
And Who benefits from making Zelinskiy look bad?
EDIT: Maybe we're not more shocked because we suspect that if we knew the whole story it would actually be much worse than this?
"Representative democracies" train people to be apathetic.
Since birth they are made to believe that the miraculous democratic republic they live in gives them agency, and that the reason they actually don't have agency is because their fellow citizens are stupid and can't vote for the right things.
The result is a feeling of justified helplessness. There's no feeling of outrage at the greedy tyrannical ruling class, because after all either you or your neighors "chose" them.
And if taxation laws are unjust, it's your neighbors' fault. They voted for red while blue would obviously have your best interests in mind. Nevermind the fact that both red and blue are part of the same wealth and social class, who benefit from the same laws.
> “how small a dent it seems to make in the discourse, and in the world as a result”
I used to think this. But now I think: maybe the ‘dent’ I’ve been looking for is essentially just excitement and hype, which isn’t change. The narrative that change happens through the mass public getting angry, forcing politicians to respond, is overblown at best. I think the boring truth is that nearly all progress in this area (and there is progress) happens through countless bureaucrats diligently working for years on court cases and regulation changes to make it harder for people to get away with this stuff. For such bureaucrats, a leak like this is going to be relevant and valuable for years, long after the media has moved on. The people implicated in the leak didn’t want the leak to happen, and there’s a reason. Sure, most are probably too powerful to get prosecuted and put in jail, but it does curb their options for future shenanigans, and they will probably lose some money. Sanctions do work. I think it’s probably always been this way too – the exciting, romantic parts of history (marches, revolutions) are the exception, we just pay more attention to them.
Core exercise of freedom of expression: investigative journalism reporting on matter of significant public interest (financial corruption, tax evasion, governmental misconduct). 19 named journalists collaborate to publish findings. Exemplifies free press function.
FW Ratio: 57%
Observable Facts
19 named journalists bylined (Simon Goodley, Harry Davies, Luke Harding, Juliette Garside, David Conn, David Pegg, Paul Lewis, Caelainn Barr, Rowena Mason, Pamela Duncan, Ben Butler, Anne Davies, Dominic Rushe, Andrew Roth, Helena Smith, Michael Safi, Robert Tait, Joseph Smith, Luke Hoyland)
Article classified as NewsArticle in JSON-LD with public interest investigation
Headline emphasizes 'biggest ever leak' and public disclosure of 'financial secrets'
isAccessibleForFree=true in metadata indicates public access without paywall barrier
Inferences
Coordinated international investigation by major news organization demonstrates institutional commitment to free press
Publication of documented investigation on government officials and billionaires' misconduct exemplifies free expression serving public interest
Free access model enables broad information distribution to general public
Core engagement: article explicitly exposes wealthy/powerful using legal structures (offshore companies) to hide assets, demonstrating systemic inequality in law application. Advocates implicitly for equal accountability and transparency.
Blair example: 'bought a £6.5m office in Marylebone by acquiring a British Virgin Islands offshore company' — demonstrates use of legal mechanism to obscure property acquisition
All named figures are wealthy/powerful, suggesting systemic pattern of privilege enabling different legal treatment
Inferences
The article's framing of these structures as noteworthy implies they represent unequal access to legal avoidance mechanisms unavailable to ordinary citizens
Publication of documented examples enables policy responses to address unequal law application
Article exemplifies preamble's call for justice, freedom, and human dignity through investigative exposé of systemic concealment by powerful; advances rule of law through transparency.
FW Ratio: 67%
Observable Facts
Headline explicitly frames this as 'biggest ever leak of offshore data' exposing 'financial secrets of rich and powerful'
Standfirst describes millions of documents revealing offshore deals for 100+ billionaires, 30 world leaders, 300 public officials
Article published by major international news institution with 19 named investigative journalists
Marked isAccessibleForFree=true in JSON-LD metadata
Inferences
The framing emphasizes hidden power and concealment, aligning with preamble's concern for justice over hierarchy
Coordinated global investigation suggests commitment to universal standards of accountability regardless of subject nationality
Reports on government officials' financial conduct and accountability; names 30 world leaders and 300 public officials in leaked data. Enables citizens to participate in governance through informed knowledge of leaders' financial interests/conduct.
FW Ratio: 67%
Observable Facts
Standfirst explicitly states: 'offshore deals and assets of... 30 world leaders and 300 public officials'
Coverage spans multiple nations' officials, enabling cross-national comparison and accountability
Inferences
Exposure of officials' hidden financial interests enables constituents to assess conflicts and integrity
Critiques systemic inequality in international financial order; offshore schemes represent structural unfairness in global economy. Advocates for reformed, equitable international social and economic order.
FW Ratio: 67%
Observable Facts
Article involves coordinated international investigation across multiple nations and regulatory systems
Coverage spans wealthy/powerful across continents, highlighting global scale of practice
Inferences
Framing of offshore schemes as problematic implies advocacy for fairer international financial order
Exposes inequality: wealthy/powerful using legal structures to hide assets while ordinary citizens pay visible taxes; frames as systemic disparity in freedom and dignity.
FW Ratio: 67%
Observable Facts
Article emphasizes disparity between public officials/billionaires (with hidden wealth) and implicit general population
Image captions name specific wealthy/powerful figures: Aliyev family, Blairs, Zelenskiy, Kenyatta with specific asset amounts
Inferences
Naming specific examples of wealth concealment by powerful individuals demonstrates the inequality being exposed
Exposes opaque property transactions through offshore structures (Blair example: £6.5m property acquired through BVI company); advocates for transparency in property rights/acquisition.
FW Ratio: 50%
Observable Facts
Specific image caption: 'Tony and Cherie Blair bought a £6.5m office in Marylebone by acquiring a British Virgin Islands offshore company' — demonstrates opacity in property rights
Inferences
Documentation of property concealment schemes supports assertion of transparent property rights
Exposes tax evasion by wealthy/powerful; tax evasion undermines social programs (healthcare, education, infrastructure) funded by tax revenue. Indirectly advocates for adequate standard of living through fair taxation.
FW Ratio: 67%
Observable Facts
Article focuses on 'offshore' schemes which commonly facilitate tax avoidance
Naming billionaires and officials suggests systematic wealth concealment affecting public revenue
Inferences
Tax evasion exposure serves right to adequate standard of living by supporting revenue for social programs
Article names individuals but bases reporting on documentary evidence from leaked dataset; presents documented holdings without explicit accusations of wrongdoing, respecting presumption of innocence.
FW Ratio: 67%
Observable Facts
Named individuals (Aliyev, Blair, Zelenskiy, Kenyatta) are identified with documented offshore holdings and specific transaction amounts
No accusations of illegality are explicitly stated in available text; connection to potential wrongdoing is implied by reporting context
Inferences
Journalism carefully documents holdings without overreaching into unproven accusations, maintaining fair standards
Article publishes leaked private financial data; this creates tension with privacy rights. However, subjects are public figures/powerful individuals and reporting is in public interest (tax evasion, corruption exposure). Net: mild negative on privacy dimension despite public interest justification.
FW Ratio: 60%
Observable Facts
Article derives from leaked dataset of millions of private documents
Guardian publishes specific private financial holdings, asset values, and offshore arrangements of named individuals
Named individuals include government leaders, billionaires, and public officials
Inferences
Publication of private data violates privacy rights even when motivated by public interest exposure of potential misconduct
The subjects' status as powerful figures and the public interest justification do not eliminate the privacy intrusion, only provide competing moral/legal claim
Article marked isAccessibleForFree=true; content available to general public without paywall. Multiple authors and institutional backing demonstrate structural commitment to information access.
Public accessibility of investigation enables foundational access to justice information; Guardian as institution provides platform for accountability.