“The difference between tax avoidance and tax evasion is the thickness of a prison wall.”
Denis Healey, UK Chancellor 1974-79
The leak of over eleven million documents from Panamanian law firm Mossack Fonseca only really scratches the surface. Like all tax havens, there is a long history of corruption and exploitation to which the tale of Panama is no exception.
In 1937, then US Treasury Secretary, Henry Morgenthau, wrote a letter to President Franklin D Roosevelt, singling out the Bahamas, Panama and Newfoundland as places where:
‘stock-holders have resorted to all manners of devices to prevent the acquisition of information regarding their companies. The companies are frequently organised through foreign lawyers with dummy incorporators and dummy directors, so that the names of the real parties in interest do not appear.’