Panama Papers: The fallout from the data leak has only just begun

 
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Several firms set up operations in offshore locations like the BVI for legitimate reasons (Source: Getty)

The Tory MP for Earlingford, James Conwyn, gave a lot of people what they were looking for yesterday morning when he tweeted his apparent ambivalence towards the leak of the so-called Panama Papers.

The gist of his statement was that the story amounts to nothing more than a voyeuristic peak into the bank accounts of rich people. For many Twitter users, this was the proof that Tories, tax evasion and the shadowy world of the mega-rich go hand in hand.

The problem was that Earlingford isn’t a real place and James Conwyn doesn’t exist. It’s a spoof account, but in the febrile atmosphere that follows a data-dump of this kind (think Wikileaks and previous tax-dodging leaks) reactions are not always rational.

To be sure, the Panama Papers (which add up to 11m files covering 40 years of commercial and financial activity) almost certainly include evidence of international corruption and criminality. Indeed, one trail appears to lead to the door of Vladimir Putin’s office and the scandal-hit governing body of world football, FIFA, crops up more than a few times.

Whistleblowing has long been used to hold the corrupt to account, and long may it continue to do so. However, among the parade of despots and crooks (against many of whom investigations have already been launched) there will be plenty of companies and individuals who have chosen to manage their money offshore for legitimate reasons – and they are well within their legal rights to do so.

The publication of the files was coordinated by the International Consortium of Investigative Journalists, who concede in their own disclaimer that “there are legitimate uses for offshore companies, foundations and trusts”, adding that those identified may not have “broken the law or otherwise acted improperly”.

Try telling that to the Twitter mob, for whom the distinction between illegal tax evasion and legitimate financial planning is seemingly non-existent. The fallout from the leak of the Panama Papers has barely even begun.

As we report, tax authorities around the world have requested access to the files. Doors will be kicked in. Meanwhile, lawful offshore operations – often vital to international commerce – should not be thrown out with the bath water.

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