What’s the story?
The accounting of the super-rich – including the Queen – has been thrust under the public spotlight thanks to a huge leak from inside an offshore accounting firm. The so-called “Paradise Papers”, released to a consortium of global investigative journalists, reveal a number of potentially dubious investments from high-profile figures.
It’s never been a secret that the ultra-wealthy invest their money in offshore tax havens. Many rich people have always sought to find ways around tax laws by employing clever accounting practices; so-called ‘tax avoidance’ rather than tax evasion. Yet until now the scale of this was unknown.
This all changed however with the release to the world’s media of “The Paradise Papers”: a leak containing some 13.4 million documents detailing the financial affairs of the super-rich. As investigative journalists frantically scour these dense pages, several high-profile names have already been linked with unethical or even potentially illegal investment behaviour. While the vast majority of the documents imply no legal wrongdoing, questions of integrity are already being raised about the financial behaviours of several high-profile figures.
The most notable of these is HM The Queen, who makes no decisions about the nature of her investments, but whose private estate has had a relatively small stake in funds held in the Cayman Islands. As a result of this, she also had an interest in BrightHouse, the high-interest rent-to-buy high street store which is accused of exploiting the poor, and Threshers, the off licence chain which went bust owing £17.5 million of tax in the UK.
Also implicated is Donald Trump’s commerce secretary Wilbur Ross, who has investment links with two high-profile Russian businessmen who are currently under US sanctions. And the ownership of Premier League football club Everton, in which a major shareholding was purchased by a Russian businessman in 2016, is now under investigation. The leak suggests that another Russian investor – who already has a controlling stake in Arsenal – may be secretly involved, which would contravene strict football ownership rules.
The leak came from an unnamed source within a Bermuda-based legal services provider called Appleby, which helps clients set up investments in countries with low or zero-rate tax levels. It was announced by BBC’s Panorama programme and the Guardian newspaper in the UK, and over 100 other journalists and news sources are involved in reporting the story worldwide. While many of those implicated have committed no crime, there will now be waves of investigations into the affairs of the super-rich.
The total amount held in offshore investment funds is thought to total at least $10 trillion – all of which is held outside of the tax-recouping mechanisms which enable the global economy to function. There are also a number of historic examples of illegal activity in the offshore accounting sector, and this leak is expected to reveal many more. Meg Hillier, a Labour MP who chairs the Public Accounts Committee, told Panorama: "We need to see what's going offshore; if offshore was not secret then some of this stuff just couldn't happen... we need transparency and we need sunlight shone on this."
What have others been saying?
Mark Woods wrote brilliantly for Christian Today on how the story evokes Jesus’ words around hiding a lamp, and how nothing will remain hidden for ever... (see connection #2 below)
#1 – MONEY AND GREED
The often-misquoted words of Paul on our relationship with money is so familiar that we either misunderstand him, or lose a sense of the gravity of what he’s saying. In 1 Timothy 6 v 10 he writes: “for the love of money is a root of all kinds of evil” – or in some translations, “the root of every kind of evil”. It’s not money itself which is bad – currency in itself is neutral. The problems come when we prioritise and even ‘love’ money. Jesus often addresses rich men and their finances directly; greed and the love of wealth accumulation are nothing new. Yet often in the church we’ve excused this grave area of sin (and, yes, even evil) because it is tied up with our comfort, sense of personal achievement and our future ‘security’. Our relationship with money is actually revealed in the way that we use and spend it, whether we’re rich or relatively poor; both Jesus and Paul warn that it’s one of the most important lifestyle issues for us to surrender to God.
#2 – INTEGRITY
In the Old Testament in 1 Samuel 12, the prophet and leader of Israel Samuel addresses the people in a kind of ‘leaving speech’ before he hands over power to a line of kings. His words are extraordinary because he offers anyone who knows anything he has done wrong in secret to the chance to reveal it in front of the whole of the assembled people. And yet so great is his integrity, that no-one can say a word against him. On the other side of this subject, in Luke 8, Jesus has some very serious words for those who do not live with integrity, and who try to hide their secret ‘sins’. “Nothing is hidden that will not become evident, nor anything secret that will not be known and come to light (v17)”, he says. The Paradise Papers leak is proof positive of this verse – the men (and a few women) who used these secret measures to hide and redirect their wealth may have assumed they would always simply get away with it in the dark.
Points for prayer
- Pray that light would be shone into the murkiest corners of tax avoidance schemes and the financial sector as a whole.
- Pray that where crimes have been committed, justice would be done.
- Pray against bitterness from those who do not share this kind of wealth.
- Pray for wisdom from law-makers that ensure that those who have great wealth are not allowed to be exempt from paying their share to society.
- Pray for safety for journalists around the world as they continue to investigate this story.
- Pray for repentance in the hearts of those who have tried to hide their shady financial dealings.
Martin Saunders is Youthscape’s Deputy Chief Executive. A former editor of Youthwork magazine and the founding Editor of sister-title Childrenswork, Martin is a popular speaker and the author of various books including ‘Youth Work From Scratch’. He lives in Reigate, Surrey with his wife Jo and their four children.