In the winter of October 2021, the Pandora Papers were revealed to the world. This was a leak of almost 12 million documents that reveal how the world’s richest people siphon off wealth (often obtained illegally) and hide it in various ways. Some of the questionable tactics include tax avoidance and money laundering with collaboration from every level of influence including some of the world’s top CEO’s and powerful political figures.
The uncovering of these shady economic practices that amount to serious corruption in some cases was a result of 600 journalists in 117 countries investigating files from 14 sources over many months. The data was obtained by the International Consortium of Investigative Journalists (ICIJ) in Washington DC, which has been working with more than 140 media organisation on its biggest ever global investigation. BBC Panorama and the Guardian have led the investigation in the UK
The files expose how some of the most powerful people in the world – including more than 330 politicians from 90 countries – use secret offshore companies to hide their wealth.
Lakshmi Kumar from US think-tank Global Financial Integrity explained that these people “are able to funnel and siphon money away and hide it,” often through the use of anonymous companies.
Why do the super wealthy choose these methods to conceal their wealth using offshore accounts and what are they?
Offshore countries or territories that exist outside of the person’s usual place of living and they offer the following benefits:
• It’s easy to set up companies
• There are laws that make it difficult to identify owners of companies
• There is low or no corporation tax
The destinations are often called tax havens or secrecy jurisdictions. There is no definitive list of tax havens, but the most well-known destinations include British Overseas Territories, such as the Cayman Islands and the British Virgin Islands, as well as countries such as Switzerland and Singapore.
This system is presented as “secret” but in actual fact, it is a well-known tool used by the super wealthy to hoard huge amounts of assets that are often not supposed to be in their possession.
In their defense, some have argued that there is nothing illegal in using these means to exploit “loopholes” in the law. The idea of it being an unethical practice at worst is a narrative spun by cohorts in this financial debacle. What should be of concern to the Muslims of the world is the fact that the list of the many hundreds of officials caught in this web of deceit include many rulers and leaders of the Muslim world.
With the mass suffering and poverty being experienced globally from Afghanistan, Syria, Lebanon, Africa and Asia to name a few, the affront to humanity that our leaders have been so selfish and cruel should not go unquestioned.
There is no exact figure available to understand exactly how much money is hidden in offshore accounts but the ICIJ concluded that it could be up to $32 trillion.
Why is this a problem? The International Monetary Fund has said the use of tax havens costs governments worldwide up to $600 billion in lost taxes each year. Ms. Kumar said it is detrimental to the rest of society: “The ability to hide money has a direct impact on your life… it affects your child’s access to education, access to health, access to a home.”
Some of the sordid dealings revealed include;
The Qatari ruling family avoided £18.5m tax on a London super-mansion purchase.
The family of Kenyan president Uhuru Kenyatta has secretly owned a network of offshore companies for decades.
The King of Jordan’s £70m spending spree The Pandora paper trail revealed that the King of Jordan went on a 70 million pound spending spree buying property in the UK and US through secretly-owned companies.
Azerbaijan’s leading family’s hidden involvement in property deals in the UK worth more than £400m.
With clear examples of how the rulers of the Muslim world absorb huge amounts of undisclosed wealth into their own fortunes, we can only guess as to why they are so keen to keep their economic matters secret.
The Pandora papers show that this behavior is supported globally by the world’s elite who help each other in their crimes.
The continuous suffering and social injustice that is the permanent situation of the most of the world’s citizens is one that is strategically designed.
Narratives about overpopulation and ecological imbalance are the least of the causes of world’s poverty and deprivation.
Allah (swt) ordained that with every life the provision is given and that we should not fear that there is a lack of abundance.
[وَاللّهُ فَضَّلَ بَعْضَكُمْ عَلَى بَعْضٍ فِي الْرِّزْقِ فَمَا الَّذِينَ فُضِّلُواْ بِرَآدِّي رِزْقِهِمْ عَلَى مَا مَلَكَتْ أَيْمَانُهُمْ فَهُمْ فِيهِ سَوَاء أَفَبِنِعْمَةِ اللّهِ يَجْحَدُونَ]
“And Allah has favored some of you over others in provision. But those who were favored would not hand over their provision to those whom their right hands possess so they would be equal to them therein. Then is it the favor of Allah they reject?” [An Nahl: 71]
The Muslim Ummah must expose the real cause of the corruption in all of our countries, all done with the support of the external Western nations benefiting from the puppet rulers.
Mismanagement and a controlled block of the return of the Khilafah (Caliphate) are all actively employed to cover the trail of destruction that is unleashed upon the world under liberal capitalist democratic policies.
The concept of the Islamic economic system and its strict regulations defining public and private wealth are real solutions to the disease of greed that infects all those in power.
Under the authority of Umar Ibn Khattab, the natural resources and the productivity of land were key areas of economic management. Land, like other natural resources was never allowed to be hoarded or monopolized by a few powerful people, was a means of production. Land won from regions opened were left in the hands of the original owners who were more capable than the Arabs of cultivating it. Furthermore, in imposing specific land taxes (Kharaj) directed people to increase and spread wealth and increased the utility of the land as a means of production. The current lack of organizing the Zakat means millions of eligible Ummah never take their annual right to wealth distribution and we are aware of the widespread abuse of the charity label being used for Zakat.
Only under the Khilafah can true accountability be restored, that is why there is such an active campaign to stop political work and spread lies that Islam is not political and has no specific ruling system.
When the Ummah sees the light of correct policies, they would never imagine to sustain any fake option or substitute for what Allah (swt) has designed in just comprehensive systems.
The Pandora Papers are not a closed book. Corruption and abuse of power will continue after names have been circulated. The people who have used the rules to serve their own interests will more than likely never be punished for their wrong doing. The Khilafah would make such acts a public matter that carries such heavy consequences that leaders at every level will fear to engage in or cover up those despicable deeds.
Member of the Central Media Office of Hizb ut Tahrir