In October, the multinational law firm known as Appleby was hacked by unknown assailants. Last week, classified information became public and was dubbed the “Paradise Papers.” The Paradise Papers reveal the list of billionaires and celebrities who have put their money in an offshore fund to avoid taxes. The number of names is staggering, and it raises the question, what is Appleby and how were they able to do this on such a massive scale?
Appleby is a law firm of nearly 500 lawyers that specialize in offshore banking. For those who don’t know, offshore banking is the act of having a bank account in another country that has low taxes compared to the country of origin. Surprisingly, this type of banking is legal if one knows what they are doing, like the lawyers at Appleby. Appleby prides itself on its user confidentiality and was angered by the hack.
Appleby expressed their frustration in a statement to the press saying they were “not the subject of a leak, but of a serious criminal act.”
So how does this affect people at large? By having extremely large amounts of money in offshore accounts that are nontaxable by their government of origin, billionaires are able to avoid taxes. Taxes are extremely important to a country’s government, as they pay for schools, emergency services, national defense and so much more. The Paradise Papers revealed that nearly $190 billion was lost in taxes globally. This is approximately 80 billion more than the entire GDP of Puerto Rico, to put it in perspective. World leaders, celebrities and large corporations like Apple were found to have millions in these accounts to avoid taxes. Many people are angered that so much in taxes were avoided. “Honestly, I don’t think offshore accounts should be a thing. Accounts need to be in the country of that person’s citizenship,” says Melissa Weinert, who is in favor of government programs.
This is just the first week of the Paradise Papers being released, and there are thousands of documents to sift through. For the rest of 2017, there will likely be more reports made on who used the offshore accounts, and how much harm that did to their country of origin.
