The country’s loose defences by design against money laundering and tax avoidance have made it a destination of choice for mega money criminals. The country is home to a sophisticated ecosystem of businesses with devilishly creative wealth management firms and high-end lawyers. A 2019 analysis by Transparency International had found that this country was home to around 87,000 properties that were owned by anonymous companies with no trace of their owner. Bringing here all the stolen money from anywhere in the world is a walk in the park. For decades, the country has intentionally acted as a home to attract money for tax avoidance and money laundering purposes. Transparency International has urged the government to strengthen its defences against “dirty money”.
You could be forgiven for mistaking the above country with Pakistan but it is actually the UK. The Pandora Papers have shown how the UK is a hub for money laundering. Whether Russian oligarchs or runaway politicians from Pakistan, the country is home to some of the dirtiest cash on earth. Half of the entire Russian money laundering is estimated to occur in England. The total value of properties anonymously owned in London alone was likely over 100 billion pounds.
I can’t help but think of the FATF regime. Pakistan is pushed against the wall regarding the issue of money laundering and terror financing. The country is still bending backwards to convince the FATF authorities of its performance in tightening the noose around money laundering and terror financing. But the FATF remains unconvinced despite years of Pakistan’s efforts. Somehow, the FATF loses its senses of detecting money laundering when it comes to England, which is literally home to money laundering. The saddest part is that Pakistan’s supposedly loose money laundering system has not affected the British economy negatively. It has rather injected billions into its economy through supermodels and calibri fonts. On the other hand, Britain’s fertile money laundering system has taken billions away from Pakistan, negatively impacting Pakistan’s economy and society.
Duncan Hames, policy director at the campaign group Transparency International UK, said, “Once again, Britain’s role as an enabler of global corruption and money laundering has been exposed with the same loopholes exploited to funnel suspect wealth into the country.” Is FATF listening or their WhatsApp is still down from yesterday’s global outage? Duncan also said, “These leaks show that there is one system for corrupt elites who can buy access to prime property and enjoy luxury lifestyles and another for honest, hardworking people.” While he is talking about the UK only, the statement can be better applied to global politics.
The universal tale of the emperor Alexander the Great goes that his soldiers caught a pirate terrorising people in the open seas. There is an audience between the emperor and the pirate. The emperor demands how dare the pirate molests the sea. The pirate says he molests the sea with his tiny little boat while the emperor molests the whole world with his large fleet. Yet, it is the pirate who, being a smaller criminal, is called a robber and the emperor, being a bigger criminal, is called an emperor.
The Pandora revelations, when compared with the FATF, is just another example of the ever-existing mindset and system in place, which could be best labeled as Pirates and Emperors. Both are criminals but the pirate is a much smaller criminal. The emperor commits a much larger crime by the rules of the game he himself put in place. The pirate only breaks some rules on a much tiny scale. Yet, only the pirate is labeled as the criminal and is punished. The emperor gets a clean chit. Nothing can be more abhorrent than this.
Importantly, while the Pandora Papers have shone light on the crimes of the big and powerful around the world, the discussion remains focused on the crimes of those people only. Having a system in place that facilitates money laundering in the first place is the real crime here. But again, who is going to speak truth to the emperor?