RPT – Pandora papers leak reveals reputational issue US needs to fix – Advocacy Group

WASHINGTON (UrduPoint News / Sputnik – October 06, 2021) ASHINGTON, October 6 (Sputnik), Ekaterina Chukaeva – Recent Pandora document leaks have revealed a reputation problem for the United States and the United States government must address it, Executive Director of the Financial Transparency Coalition Matti Kohonen told Sputnik.

The Pandora Papers, compiled by the International Consortium of Investigative Journalists and published by several publications, showed that several US states such as South Dakota and Nevada have passed laws protecting trusted customers in the United States and in abroad.

“This is a reputation problem and the United States must tackle it with other global cooperation within the United Nations and the Financial Action Task Force (FATF) to close other tax havens in around the world, ”Kohonen said.

Now that South Dakota’s practices have proven to be as secretive as other global tax havens, the United States appears to face serious money laundering risks in its “own backyard on the Prairies,” a he declared.

“In Washington, it seems inconsistent to have a new, burgeoning tax haven in your own midwest while trying to end tax evasion by large multinational corporations and engaging in anti-corruption legislation to tackle foreign corrupt practices using the US financial system in particular, “Kohonen said.

The adoption of federal legislation and engagement in international cooperation are necessary to close these tax havens, he said.

“The Pandora papers clearly show that state-level reporting on beneficial owners and corporate regulation is susceptible to abuse, as you can attract secret trusts to your territory without doing too much harm to your own territory in terms of loss of income, while obtaining well-paying jobs (which is the typical operating model of a tax haven).

The effect is being felt by other states and countries in terms of lost revenue and increased opportunities for corruption, ”Kohonen said.

Federal legislation should ensure that the owners of all companies, trusts and foundations are declared on this register and that such a register is also made public, he said.

“The Pandora Papers show that such a regulation dissuades, ironically from the Bahamas, which is considering such a registry towards South Dakota, which does not yet have one,” he said.

Kohonen noted that the US government is already working on such legislation called the Corporate Transparency Act.

“The US Treasury is working on a database on the beneficial owners of companies and would seek to implement existing laws requiring companies to report ownership to the federal government,” he added.

The Pandora Papers have revealed a network of offshore banking services among the world’s elite, including 35 world leaders and former world leaders and more than 330 officials around the world involved in tax haven practices to hide vast wealth and property. The investigation was based on more than 11.9 million leaked financial documents.

The Financial Transparency Coalition is a working group of non-governmental organizations and governments working to reduce illicit financial flows.

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