'Panama Papers' Also Expose the Banks, Particularly HSBC

April 7, 2016

Amid the international furor over the April 4 announcement of a vast collection of "shell company" creation documents somehow obtained from a Panama law firm, Bloomberg News on April 5 and 6 carried two interesting reports. They contribute to the judgment of one of EIR's veteran intelligence sources, that the huge exposure of means of hiding money over the last 40 years, will hit the British financial empire offshore banks including its Hong Kong and Swiss elements.

Initially, worldwide coverage promised that "Putin" or "Chinese President Xi" were at the center of tax evasion networks. This is clearly not substantiated, has been ignored by those Presidents, and has already been dropped in many media accounts.

One of the Bloomberg reports, was that the United States, UK, Panama are among very few countries which have not accepted the OECD regulations on reporting of foreigners assets held in, for example, the United States. Thus America, with its very large banking system, is the largest tax haven in the world. This despite the United States' own FATCA regulations, which require other countries to report U.S. citizens' holdings abroad, and are very strongly enforced by U.S. sanctions.

"'The U.S. doesn't follow a lot of the international standards, and because of its political power, it's able to continue,' said Bruce Zagaris, an attorney at Berliner Corcoran & Rowe LLP who specializes in international tax and money-laundering regulations. 'Its basically the only country that can continue to do that.'"

"The latest reporting 'underscores the secrecy in Panama,' said Stefanie Ostfeld, the acting head of the U.S. office of the anti-corruption group Global Witness. 'What's lesser known, is the U.S. is just as big a secrecy jurisdiction as so many of these Caribbean countries and Panama. We should not want to be the playground for the world's dirty money, which is what we are right now.'"

The second report was that HSBC, London and Hong Kong's flagship bank since the opium wars and the biggest bank in Europe, is clearly the drug, tax-evasion, money-laundering bank of the world. "A trove of leaked documents casts HSBC Holdings Plc into a harsh light, as a consortium of investigative journalists said it found the bank was among the most active in registering shell companies that move money around the world on behalf of rich and politically connected clients. HSBC and its affiliates accounted for more than 3,300 of the 15,600 shell companies that Mossack Fonseca, a Panama law firm, helped form for clients of hundreds of international banks."

Nonetheless, the news service also reported from sources that "The U.S. plans to search the millions of documents leaked from a Panamanian law firm for information about people who may have helped companies or individuals evade sanctions related to Russia's role in destabilizing Ukraine." But here again, the sword is two-edged: Ukrainian coup-President Poroshenko hid money through the Mossack Fonseca law firm in Panama, while Ukrainian conscript solders were trapped and being killed just before the ceasefire in Eastern Ukraine.