Panama papers

Analysis: The security implications of the Panama Papers

Equally importantly, however, the leaked documents reveal that Mossack Fonseca’s clients appear to include at least 33 individuals and companies that are involved in organized crime or have close contacts with terrorist organizations. This sheds light on the increasingly disappearing line that once separated illicit activities such as tax avoidance and tax evasion, from money laundering, organized crime and terrorism. This phenomenon is assisted by unscrupulous companies like Mossack Fonseca, which act as anonymizing platforms for wealthy celebrities, criminals and terrorists alike.

The leak also shows the extent to which national governments have been unable to stem the tide of unfettered finance-capitalism, which today threatens the stability and cohesion of developed and developing economies alike. Moreover, the sheer scale of offshore capital funds, which, according to one expert, amount to as much as $32 trillion, threaten the economic security of nation states and must be viewed as an existential threat to the ability of states to fund public expenditures though taxation. The political arrangement that led to the creation of the postwar welfare state is today being directly threatened by the inability or unwillingness of organized states to monitor the largely unregulated flow of capital to offshore tax havens.