What the Paradise Papers Tell Us About Global Business and Political Elites

Yves here. For some perspective, consider this Quartz article (hat tip resilc), If you think the Paradise and Panama papers are bad, wait until you hear about Delaware. Key sections:

In fact, the US is one of the largest recipients of illicit financial flows from developing countries—money often smuggled out by corrupt politicians, drug dealers, or everyday criminals…

Just as small countries tend to breed the political culture that allows corporate secrecy, sparsely populated US states have competed in a race to the bottom to attract corporate investment through lax disclosure requirements. The tiny state of Delaware, called an “on-shore tax haven” by critics, garners more than a quarter of its public revenue—just over a $1 billion—from its business registry.

This probably factors into the World Bank’s assessment of the US as one of the worst offenders (pdf) when it comes to corporate secrecy. In fact, a 2012 academic study reports that it is easier to form a shell company(pdf) in the US than it is in Panama—or indeed, anywhere else but Kenya. At the top of their list? Delaware and Nevada.

Also note that this story talks about “tax avoidance” which is legal, and not “tax evasion,” which is not.

By Ronen Palan, Professor of International Politics, City, University of London. Originally published at The Conversation; cross posted from MacroBusiness

The so-called Paradise Papers may sound familiar – leaked documents from a law firm that specialises in offshore services reveal how the global elite avoids paying taxes. Even the name has the same ring to it as last year’s Panama Papers expose. But the Paradise Papers are different, reflecting the complexity of the global offshore tax system.

Panama is generally considered among tax haven experts as one of the least reformed corners of the offshore world. International rules regarding tax evasion and avoidance are intended to help national governments to pursue their own offenders, but the Panama Papers revealed that the country was being used primarily by the business and political elites of countries like Russia, China and many more in Latin America and Asia; countries where the governments are closely linked to business and which are less likely to use tools provided by new international rules to pursue offenders. Hence, relatively few Americans or Europeans were caught in the Panama story. And Mossack Fonseca, the law firm at the centre of the leak has since been discredited.

The Paradise Papers reveal the goings on of the elites of the offshore world – this time in the supposedly highly-regulated havens of the Cayman Islands, Bermuda, Singapore and the like. All places that received a fairly clean bill of health during the OECD peer review process only a few years ago. The law firm at the centre of this new leak, Appleby, insists there is “no evidence of wrongdoing” in any of the revelations.

Nonetheless, the Paradise Papers will tell us a lot about the activities of business and political elites of well-regulated countries like the US and UK – implicating big multinationals such as Nike and Apple, and individuals including the British Queen.

The Queen’s private estate invested millions offshore. The Commonwealth, CC BY-NC-ND

Tax Avoidance is a Booming Industry

Clearly, jurisdictions such as the Caymans Islands and Bermuda that levy no income tax, capital gains tax, VAT, sales, wealth or corporate tax, still attract a great deal of businesses. Why, for instance, has the Duchy of Lancaster, the Queen’s private portfolio, invested in two offshore funds, in Cayman and Bermuda? After all, the Queen pays tax only voluntarily.

A more charitable interpretation is that any big investor who is seeking to diversify their portfolio would inevitably end up using offshore funds. The papers show that about £10m (US$13m) of the Queen’s private money was invested offshore – a very small percentage of her wealth. There is nothing illegal about this but the ethics of it have been questioned.

Practically, the entire wealth investment industry – the industry that invests for the rich and the wealthy of our world – operates through the offshore world. And the reason why is simple. Each fund or transaction, or aeroplane or yacht, or whatever that one cares to register in the Caymans or Bermuda, is not subject to tax. And it’s hidden from public view.

Secrecy Prevails Through Trusts

Despite a spate of new regulations, the Paradise Papers show that anyone who wishes to conceal their affairs from competitors, allies, governments or the public can still do so with great ease. And they can do so through the facilities of a “trust”, an archaic Anglo-Saxon instrument that serves as a foolproof shield from scrutiny.

We have learned, for instance, that Wilbur Ross, the US secretary of commerce, had commercial links to Vladimir Putin’s family, which operated through a system of linked trusts located in various offshore jurisdictions. I do not think that even the Mueller inquiry in the US into the Trump administration’s links with Russia could have pierced the veil of secrecy offered by offshore trusts.

But the leaked documents from law firm Appleby reveal that any complex business deals that would involve concealment and subterfuge would work their way through trusts. It is high time we do something about these trusts.

Highly Complex Tools Are Used

The Paradise Papers show how complex financial innovations such as the use of derivatives and financial swaps arrangements, can be used for tax avoidance. This is an area of avoidance that is normally not well understood and scantily studied.

New research colleagues and I are conducting, however, has found that cross-currency interest rate swaps are used pervasively in tax minimisation mechanisms. It is difficult to detect and involves a parent and subsidiary companies swapping a loan in one currency to another. This swaps the risks and the interest rate of the original currency for the subsidiary’s – a legitimate risk minimisation instrument. At the same time, this facilitates moving funds offshore to low tax jurisdictions.

4. The Law Needs to Change

Many professional service firms operate through offshore jurisdictions. They all claim to be highly professional, following not only the letter, but also the spirit of the law.

But if these firms are not directly liable for the activities of their clients, the offshore world will continue to thrive. These firms take advantage of regulatory loopholes to arbitrate between different rules and jurisdictions in order to minimise taxation. The question is for how long such practices are going to be considered legitimate.

The Paradise Papers reveal how little the world really knows about the level of tax avoidance that takes place. UK citizens, for instance, can legally invest in offshore funds and set up companies in those havens. But they must reveal these holdings to the tax man. We do not know whether those named in the papers did, and we do not know whether the tax authorities will do something about those who did not. We only know that a lot is going through offshore. The Paradise Papers show that, despite promises of the opposite, opacity is still pervasive in the offshore world.

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  1. Pavel

    As I type the top story on Hacker News is called “Paradise Papers: Dear Tim Cook” and links to An open letter to Apple’s CEO from the Süddeutsche Zeitung‘s editor-in-chief, Wolfgang Krach. It is deservedly scathing. After noting that he is a devoted fan and user of Apple products, he writes:

    My colleagues and I have long followed the debates in the United States and Europe over the taxation of Apple. You, yourself, have often taken a stance on the issue, like you did before the U.S. Senate in 2013. You said at the time that Apple did not “depend on tax gimmicks.” In the Paradise Papers, however, we uncovered information that tarnishes the image of Apple that you try to convey. Questions posed by the Süddeutsche Zeitung and our aforementioned colleagues have gone either unanswered or been met with, at best, tight-lipped platitudes. Why?


    In Germany, Apple is estimated (you don’t publish the exact figures) to have generated revenues in the billions last year – of which it paid 25 million euros in taxes. In other words, only 0.2 percent of the taxes that Apple paid worldwide ended up here. This does not even remotely stand in relation to the percentage of global sales and profits Apple logged in Germany. I’m sure you can appreciate the difficulty we have explaining this to our readers.

    As an ex-Apple fanboi myself (when Steve Jobs was around, although he wasn’t known for paying taxes or always behaving ethically), I still follow the main Mac blogs and I can hear the defence in my head:

    They all do it!

    They have a duty to their shareholders to maximise profits!

    They don’t do anything illegal!

    Etc, etc… The reason why these actions aren’t “illegal” is because the governments involved have been bought lock stock and barrel by the multinational corporations. And at the very least Tim Cook was being economical with the truth in his testimony before congress.

    Bah bloody humbug.

    1. Tim Mason

      Apple – le hold-up mondial https://france.attac.org/nos-publications/notes-et-rapports/article/apple-le-hold-up-mondial

      The French anti-neolib militant group Attac has been going after Apple’s non-payment of taxes for some time now, carrying out guerilla strikes on their stores – https://france.attac.org/actus-et-medias/les-videos/article/230-kg-de-pommes-pourries-pour-les-230-milliards-de-profits-accumules-par-apple for example. If you can read French, the first link is quite informative.

  2. Northeaster

    They are not “loopholes”, the law was intentionally changed by politicians to meet wealthy folks needs, The People continue to vote the very same back into office every year who do/did this.

    As someone who worked at a firm featured in The Panama Papers, my state legislature was lobbied in the mid-2000’s to change the law that allows businesses (i.e. LLC’s) to be named beneficiaries in Nominee Trusts. The companies were bogus of course, but there was no mechanism at the SoS levels to verify anything, especially in Nevada and Delaware (and used to be Wyoming, but they changed), as they don’t ask any questions. In my case, our off-shore of choice was The Cook Islands, but mileage varied for other folks as was presented in The Panama Papers.

    The media completely buried the story here, I even contacted the two major outlets and never heard back. State Reps. have no intention of changing the status quo (I’m in a super-majority Democrat state). In our case, we dealt with old-school legacy money, all completely “legal”.

    Wake me when voters actually care, especially those within their own Party that do this.

    1. Marco

      This +1000. The image our masters like to put forth is a bunch of hapless lawmakers creating tax laws and it’s like

      “oops..darn…dang it…look at all those silly loopholes!! How could that have happened?”

      The laws are written to allow this behavior. There is nothing “accidental” about it. Also I wonder if being the senator from Delaware allowed Biden (and his spawn) to climb near the top of Team Blue.

      1. Off The Street

        In simpler times, it was sufficient for Upton Sinclair to say “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”

        Now in these modern, sophisticated days, your humble servant (surely not the only one, also include Downton Sinclair) proposes the following:

        “It is difficult to get a man to understand something when his re-election depends upon his not understanding it.”

      2. Northeaster

        The other benefit of filing in Delaware is that they have the shortest statute of limitations when it comes to suing. Of course this may become moot as companies start (if they haven’t already) to incorporate arbitration language in regard to use of their products and/or Agreements.

    2. diptherio

      Wake me when the will of voters actually has any statistically significant effect on the actions of law-makers (see Gilens and Page, 2014).

      1. tongorad

        “Never be deceived that the rich will permit you to vote away their wealth.”
        -Lucy Parsons

        Then again, don’t mourn, organize!

        1. John

          The “normal” people I talk with (those not obsessed with politics) don’t really care about who is paying taxes anymore. Sure, they know and complain that “the rich don’t pay”, and “the corporations don’t pay”, but – in the end – they also suspect it doesn’t matter all that much.

          The government keeps spending, life goes on (and has for generations now). Maybe IF taxes actually mattered to spending, and maybe IF – as a result – it was EITHER perpetual war OR your social-security payment then people might care, but as it is now; there’s no feedback left (which is brilliant on the part of the elite).

    3. mpalomar

      “The media completely buried the story here, I even contacted the two major outlets and never heard back…wake me when voters actually care…”

      I believe there is a connection.
      The voters care but are uninformed and that, as with the loopholes, is not an accident.
      Thanks for your insights on how it works, as someone without accounting or legal acumen the actual sleight of hand is still unclear to me. It seems creating a chain of innocuous trusts and LLCs helps cover tracks. The interest rate swaps and currency exchanges are clearly mechanisms but the grift remains mostly a mystery. It is obvious why the average voter though angry about the swamp, still doesn’t understand the ecosystem where the swamp creatures operate. There is a lack of media focus and commitment.

      1. jrs

        it is difficult to understand and as mentioned by diptherio the voters have little reason to think their choice matters anyway no matter how much they go to the trouble of trying to understand. It is a strong incentive to apathy those two.

    4. Anon

      Speaking of Nevada, (a state where I worked and lived with some of the aforementioned “crooks”), one of those Secretary of State (SoS) responsible for overseeing stealth business incorporation was my genial neighbor, Dean Heller. He’s now the junior Senator for Nevada in Congress and one of the dupes who supported the TrumpCare plan. Don’t think that he knows all the methods of these scams. Nevada has incorporated the “trust” that holds Apple, Inc. “offshore funds”. (There is no shore in Nevada.)

      1. John Elliott

        Don’t let the term ‘offshore’ confuse you. It refers to any transaction that takes place in state A but is booked for accounting / tax purposes in state B. There doesn’t need to be a stretch of blue water between these states. Thus when I buy a book viw Amazon UK for delivery here in London, the transaction is booked in Luxembourg even though the Amazon warehouse is just fifty kilometres north of where I’m sitting. For tax purposes the contract is offshore. This might provide a hint of why globalisation has caused inequality to sky-rocket

  3. Thuto

    Glencore, one of the companies fingered in the Paradise Papers, “stripped” the Zambian government of its entire copper mining assets (the IMF conveniently backed the Zambians into a corner by asking them to liquidate the assets, ostensibly to avoid a default). For the government, direct revenue into its coffers was now replaced by hoped for tax revenue, which as the readership can surely imagine, Glencore masterfully avoided using the usual shenanigans (Copper worth billions in world markets was extracted, with the Zambians receiving less than 1% of that in tax revenue.)

    And one can, with some merit, opine that export led economies in developing countries are being hurt by currencies being kept artificially strong to enable the rogue elements to hedge their forex risk when repatriating their loot to these offshore havens (something Colonel Smithers alluded to in the case of Mauritius the other day). The political will to tackle all this is atrophied by either: 1. The political and financial elites being the same people, 2. The financial elites having the resources to pick the jockey/s (politicians) to ride their prized horse (government). Either scenario puts paid to the hope of coming up with enforceable mechanisms to eradicate this scourge

    1. Colonel Smithers

      Thank you, Thuto.

      I know Glencore well as they are big client of my current employer, especially the division I support.

      It’s not just Zambia suffering at the pincer the IMF and Glencore have devised, but other states in the SADC, especially in the lusophone country up the road from Cape Town – and making money from and for its reigning dynasty.

      As my former employer, the blue eagle, scales back from Africa, its German twin, even more of a basket case, is moving in and making a lot of money, which is raising eyebrows in the conduct risk control functions in London, but not elsewhere.

      Glencore relied on its British (colonial era) banksters, for whom I used to work directly and indirectly, to lobby around the world for its interests, but can now rely on Germany, too. Just as the Irish and residents of the EU’s Mediterranean periphery saved my employer in 2008 and beyond, it’s now Africa’s turn to help my employer return to health.

      I wonder when Africa will become independent (from colonisation by stealth).

      1. Thuto

        Thank you Colonel Smithers, I know someone who works in the Johannesburg office of the German bank you reference, but I could never have guessed at the nature and scale of their covert activities in Africa, though i’m not surprised by it. Considering that they’re on life support globally (what with massive fines in the US and a leadership that frankly sounds clueless at times), one can imagine the desperate need to hook their tentacles into someone/something to facilitate a return to health, and Africa happens to be a soft target.

        1. Colonel Smithers

          Thank you, Thuto.

          I was surprised to at what’s going on and where.

          The relationships are managed from the capitals of the former colonial masters, but transactions are booked in London, except for trade finance, which is booked in lower tax Amsterdam.

    2. nonclassical

      …”With a convincing, if expected, victory for (DNC? dem) governor of New Jersey, Philip D. Murphy, a former Wall Street banker…”

  4. Steve Ruis

    The game is called civilization. It is a game in which the few (the elite) extract labor, food, wealth, etc. from the many by coercive means (the coercion of the state started with physical force and now is more “subtle”; the religious coercion has always been subtle but also always as a partner of the state). The earliest cities (the dawn of ‘civilization”) were run by religious elites, for the elites, by extracting labor from the many, well before the idea of a “King” was attempted.

    Has there ever been a system that did not involve the few exploiting the many? If so, I am unaware of it. I note that you do not need to be a capitalist, to partake of these tax havens. All that is required is the elite characteristic of greed.

  5. flora

    “wait until you hear about Delaware.”

    Tax avoidance haven. While Delaware Senator Biden voted to make discharging student loan debt in bankruptcy impossible.

    And there’s the austerity in the UK that prompted Brexit, in part. Turns out that auserity would have been unnecessary… if the very wealthy paid their taxes.

    As tax havens grow the 90% see our taxes increase and services cut. In the US now there’s another attempt to cut taxes on the very wealthy and large corporations. They aren’t creating jobs or growing America with these windfalls (as they said they would with the Bush/Obama tax cut.) They’re taking the money and running.

    1. nonclassical

      …”Delaware” (and much more) historical documentation found in Shaxson’s, “Treasure Islands: Tax Havens and the Men who Stole the World”:

      “While the United States experiences recession and economic stagnation and European countries face bankruptcy, experts struggle to make sense of the crisis. Nicholas Shaxson, a former correspondent for the Financial Times and The Economist, argues that tax havens are a central cause of all these disasters.

      In this hard hitting investigation he uncovers how offshore tax evasion, which has cost the U.S. 100 billion dollars in lost revenue each year, is just one item on a long rap sheet outlining the damage that offshoring wreaks on our societies. In a riveting journey from Moscow to London to Switzerland to Delaware, Shaxson dives deep into a vast and secret playground where bankers and multinational corporations operate side by side with nefarious tax evaders, organized criminals and the world’s wealthiest citizens. Tax havens are where all these players get to maximize their own rewards and leave the middle class to pick up the bill..”

      (aka, “Meyer Lansky scheme”..)



      1. Scott

        I’ve said for long we live in a world of Meyer Lansky Financial Engineering & J. Edgar Hoover policing.

    2. jrs

      perhaps we should just seize the real property of the rich or limit the ability to hold it in more than use quantities. I mean property represented by bits and bytes can hide, but land and real estate the like … has nowhere to hide. Maybe taxation as a means of redistribution doesn’t really work, in short liberalism may not really work (though it is better than the fake kind which is all we get recently).

      Their bits and bytes are symbols of wealth and power, but not necessarily the thing itself, the thing itself is the shelter we rent or mortgage ourselves for, the food that is grown on real land etc..

  6. Kokuanani

    I wonder if one of the reasons the Queen has not handed over the throne to Charles is that she fears that his “charitable instincts” [which, however small, are certainly greater than hers] would lead him to donate too much of that squirreled away family wealth to “good causes.”

    Just a thought.

  7. Colonel Smithers

    Thank you, Yves.

    A few observations if I may, especially as my current and former employers are involved with this tax efficiency.

    These papers have been doing the rounds for over a year. I know that wading through them and getting stories to publication takes time, but why now?

    It’s interesting that Lewis Hamilton and the British royal family got a lot of exposure, even in France from Sunday evening onwards. Their off-shore arrangements aren’t illegal and aren’t unknown. Apart from Apple, why not go for the really big fish or are they too powerful to take on. The editor of the Bavarian newspaper has written an open letter to Tim Cook, but why does he not write to the magnates who come from “the land of lederhosen and lap tops”, as Bavaria calls itself. Most of them hide their loot across Lake Constance, much nearer than Bermuda to visit.

    You rightly point out Delaware, but what about South Dakota, where the Rothschilds have opened an office, and one of Canada’s maritime provinces, where Arthur Andersen set up many vehicles, including one for a US political dynasty much loved by the NC community.

    The EU27 will get worked up about the UK colonies and firms that facilitate such criminality, but fail to do anything about Ireland, Switzerland and the Benelux trio.

    My former employer, the Home for Scottish Bank Clerks, is a UK HQ’d and listed firm, but the holding company has a series of Dutch holding companies just below. Airbus operates through the Netherlands, too. EEA jurisdictions hide much more and worse than the Blighty’s tropical outposts.

    Last, but not least, Mauritius, which celebrates fifty years of independence from the UK on 12 March 2018, will be surprised to watch the BBC report that it’s a UK crown colony. As Mark Thompson, formerly of the BBC and now at the NYT, said recently, British journalists don’t do fact checking.

  8. Bob Blake

    So far everything I have read about the Paradise Papers is that everything everyone did follows the appropriate laws. If you find offense that someone did not pay more taxes by following the laws, tough. Still offended and maybe outraged? Then get off your complacency and take action to change the laws besides whining about them or embrace the suck. Frankly I would not and do not pay one cent more than I have to because no one who takes my money in taxes gives a single damn thought as to how I want them to be spent. Just call your local government elected representative and experience “I don’t give a damn about you” in action. That’s assuming you are not shuffled off to voice mail hell.

  9. Altandmain

    Basically the rich have abandoned any notion of noblesse oblige. They feel no responsibility for society and are trying like parasites to extract what they can out of the productive parts of society.

    This was not just hapless lawmakers. They was lobbying, campaign contributions, PACs, and all sorts of backroom deals. I am waiting for the next leak to show the extent of the dirt.

    There is a relationship between the fact that the waged austerity, cut basic services, while letting the rich go up until this point. People are dying of economic despair, starvation, and hopelessness while these people are sticking money into tax havens.

    Personally, the way this is going, I feel that tax evasion from rich people should carry severe penalties. That is up to the death penalty. At the very least, the seizure of all wealth and ought to be done.

    1. MichaelSF

      It is mildly surprising that there are so many wealthy people/institutions that appear to have never been told the parable about the goose that laid the golden eggs. Smart parasites will work symbiotically with their hosts and enjoy the benefits for a long time, dumb parasites kill the host and then whine about how hard times have become with no easy sustenance falling readily to hand/proboscis.

  10. Kris Alman

    I live in Niketon (aka Beaverton, but the Oregon legislature granted Nike exemption from “forced annexation” for 35 years a decade ago). Nonetheless, Nike owns the City of Beaverton, Washington County and the State.

    Last night I went to a panel discussion sponsored by SEIU and AFSCME to hear about Initiative Petition 25. This IP would require tax transparency of publicly traded companies. In deference to corporations’ claims that trade secrets could be disclosed, the IP delays the public availability of this information by 3 years.

    The august panel brought up the Paradise Papers in conveying the need for this legislation.

    I pointed out that tax avoidance is the trade secret of big corporations like Nike and high-net-worth individuals. Even if we had it, the Oregon legislature simply does not want to joust with the (Phil) Knights of the (Business) Round Table.

    In 2006, the US Treasury deemed Oregon (along with Delaware, Nevada and Wyoming) “attractive to those persons seeking to hide illicit activity within the framework of shell companies.” The Oregon legislature passed a watered down bill to address this problem, stripping out a requirement from the initial bill to disclose beneficial ownership–supposedly due to budgetary constraints.

    Sure, we need to get rid of illicit activity. But who will take on the “lawful” stuff that corporations and high-net-worth individuals get away with (while simultaneously finding tax shelters for their private foundations)?

    HB 2577 (which passed overwhelmingly in the House) died in the Senate Rules Committee this past legislative session in Oregon. The bill would have required lobbyist disclose how they lobbied in favor of or in opposition to bills or amendments and each person or entity that hired lobbyist and what they paid them. Dan Bates, the head of the Capitol Club, an organization which represents lobbyist interests in Salem, testified against the measure when it was before the House Rules Committee.

    The sky is the limit when it comes to campaign contributions in Oregon. Transparency sputters when politicians can be bought and discarded by corporations and high-net-worth individuals. Is it any wonder that the United States is no longer a full democracy?

  11. Adam Eran

    For a little perspective: Harry Truman famously turned down all appointments to corporate boards he was offered when he retired. On the other hand, he did have to sell the family farm to afford his retirement.

    Meanwhile, on our local scene, I just heard from a former mayor / city councilman from Folsom–Robert G. Holderness. He’s promoting the latest scheme from the land speculators–thousands of acres of ag land south of Folsom. That means he’s employed by the same people he used to regulate. He was one of the attorneys fighting a recent initiative to have a public vote on whether land speculation would be approved. But I guess everyone knows democracy is icky.

    If you doubt that land speculation is profitable, it’s the corruption of choice on the local scene, at least in California. The speculators can buy agricultural land for a few thousand dollars an acre, then when they finally get the rights to develop that land from local government, re-sell it to builders for 50 to 100 times more than they paid. This profit–called the “unearned increment”–is completely untaxed if they exchange out of the development land into something that produces income (apartments, shopping centers). Pretty good, no? 5,000% – 10,000% profit…after tax!

    Where do I sign?

    Meanwhile, in Germany, the developers have to sell the land to the local government at the ag land price, then buy it back at the upzoned price. All of the unearned increment stays in the hands of the public.

    For those unfamiliar, Germany has wonderful public services, excellent infrastructure, single-payer health care, and free tuition for even foreign students at its universities. I’m told the City of Berlin has a bigger arts budget than the National Endowment for the Arts for the U.S. of A.

    1. Hiho

      This very same scheme is what speculators in spain used to do during the good old bubble days.

      They would buy ag land, then they would bribe local politicians, who would change the status of this land to allow building, and at last: the killing.

      “Recalificar” as it is said here.

      By the way, the fact that germany managed to avoid this kind of real estate bubbles is the reason why they are still an industrial powerhouse.

  12. RBHoughton

    My interest is history. I imagine that its less the avoidance of tax and more the avoidance of identification that attracts the rich and famous to Cayman, Bermuda, Singapore and others that provide avoidance services.

    When lurking in the forest of rules and regulations awaiting prey, the canny financier can adopt a multitude of identities to perplex and baffle his victim until the options have been bought, the other shareholders brought around, the share price affected and only then does the prey realise he is on the menu. It is the reason highwaymen and bank robbers wear masks but we fragrant chaps in Armani suits don’t catch our lunch in such a violent and offensive way.

    It seems to be the reason national governments cannot avoid the attentions of vulture funds – those people simply incorporate a new mask and no-one knows who they are.

    I believe the nominee company frolic was invented by a British Minister at the request of the shipping industry back in 1860s when Britain carried the world’s international trade and its shipowners were being pursued, their ships arrested in foreign jurisdictions, for cargo claims they preferred to avoid. By disconnecting ship from famous owners they mitigated and sometimes avoided their liability to customers.

    Amusingly the City of London did not recognise the value of this concession which parliament had voluntarily provided without quid pro quo and it was not until the next century that a Mr Solomons litigated in the High Court for an interpretation of the new clause.

    Then the avoidance of liability really took off so its been actively if quietly pursued for a century. I guess it has only become more popular now the availability of paper money has become so accessible. The banks hardly know what to do with it but there’s always some wide boy with a plan.

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