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THREAD on the Paradise Papers. /1
This week you will hear it said that there are 'good' reasons why people might put money into tax havens. /2
What are those reasons? I can only think of four - and they often or usually apply in combination. /3
For secrecy: to put assets where (usually) states or (less frequently) private parties can't see them. /4
For tax: to improve your tax position. Either lawfully or unlawfully. /5
For regulatory avoidance: to dodge laws other than tax laws which would otherwise apply. /6
For asset protection: to put money where those you owe it to can't reach it. /7
Unpacking the reality of which applies is usually (for journalists) complex or impossible. /8
It's very hard to reverse engineer from a picture of part of someone's affairs their reason for doing it. /9
This means you won't see journalists firmly pointing the finger at wrongdoers. In practical terms they can't. /10
But my basic point is, none of those reasons are laudable. They're generally all 'bad', the real question is 'how' bad. /11
You will hear it said in response that the behaviour in question is 'lawful'. /12
The truth is, journalists have no way of knowing if this is so. They don't have sufficient visibility of what the individual has done. /13
So the fact journalists report without demur that an individual says something is lawful doesn't mean it is actually lawful. /14
But the key point is, it's not enough to say something is 'lawful'. That's an answer to the wrong question. /15
If you're accused of doing something morally wrong, it's no response to say the law permits it. /16
The present allegations of sexual misconduct concern behaviour that is 'lawful'. But that's not a sufficient answer to the allegations. /17
Behaviour can be lawful and still wrong. That statement is as true of financial affairs as any other type of affair. /18
So what should you do if your name appears in the Paradise Papers and you want a clean bill of moral health? /19
You should work with journalists to help them understand your reasons for doing what you did. /20
If you're not prepared to do that you'll need to swallow the moral criticisms that come your way. /ENDS
