Evizda

Panama saw populist protests on Wednesday in response to Panama Papers revelations that the nation’s lax tax laws are providing a haven for the world’s wealthiest to stash their cash. But in the United States, where observers note that corporate greed is surely not lacking, the leak has yet to produce such a grassroots display of outrage.

This may be because U.S. one-percenters have largely escaped the leak unscathed (more Czech nationals were named in the documents than Americans), and also because wealthy Americans already call one of the world’s foremost tax havens their home.

“The U.S. is one of the easiest places to set up an anonymous shell company to move ill-gotten gains around the world. It’s also one of the most popular places to do so for the criminal and corrupt,” writes the UK-based anti-corruption group Global Witness.

“Corporate greed needs to end. They’re taking advantage of the benefits of America, yet refuse to accept their responsibilities as Americans.”
—Bernie Sanders

Mossack Fonseca, the tax advisory firm whose documents were leaked in the Panama Papers, had set up offices in Nevada and Wyoming—two of the most egregious tax havens in the U.S.—so as to better enable the firm to take advantage of those states’ lax laws on behalf of its international clients.

The phenomenon is not a new one. “Already the largest location for managing foreign wealth,” the Economist wrote back in February, the U.S. “has picked up business as regulators have increased information-exchange and scrutiny of banks and trust companies in Europe and the Caribbean. Money is said to be flowing in from the Bahamas and Bermuda, as well as from Switzerland.”

U.S. tax haven states enjoy the benefits of the incorporation fees, and have lobbied fiercely against stricter regulation. Furthermore, the CIA and other spy networks make use of these lax laws in order to secretly funnel aid and weapons to various governments, among other uses, as the Panama Papers made clear—and so such agencies also continue to benefit from the status quo.

“How ironic—no, how perverse—that the USA, which has been so sanctimonious in its condemnation of Swiss banks, has become the banking secrecy jurisdiction du jour,” wrote Peter A. Cotorceanu, a lawyer at a Zurich law firm, in a recent legal journal. “That ‘giant sucking sound’ you hear? It is the sound of money rushing to the U.S.A.”

The Guardian points out, “in 2015, in a ranking of tax havens most attractive for those looking to hide assets, the U.S. came in third—surpassing Caymans and Singapore.”

“What was Panama’s ranking?” the newspaper writes. “It was ten spots behind the U.S., at 13.”

American Public Media’s Marketplace reports on the phenomenon:

And before the Panama Papers put the terms “offshore tax haven” and “shell corporation” in headlines around the globe, reporters have highlighted the egregious tax evasion of the global elite—and how the U.S. has become an international stand-out in permitting it within its borders.

“The secretive business havens of Cyprus and the Cayman Islands face a potent rival,” Reuters reported this past January. “Cheyenne, Wyoming.”

Describing “a little Cayman Island on the Great Plains,” the news service reported on the doings of “Wyoming Corporate Services, a business-incorporation specialist that establishes firms which can be used as ‘shell’ companies, paper entities able to hide assets.”

“A corporation is a legal person created by state statute that can be used as a fall guy, a servant, a good friend or a decoy,” gushes the Wyoming company on its website, according to the Reuters report. “A person you control… yet cannot be held accountable for its actions. Imagine the possibilities!”