Leaks reveal giant foundations in tax havens
Several hidden, private foundations in tax havens with access to staggering sums are uncovered in the Paradise Papers leak.
The funds are the largest of their kind and provide insight into how a part of the wealth of the extremely rich is managed.
One of the funds belongs to Richard Simons, founder of the hedge fund Renaissance Technologies. He is also the United States’ 25th richest man, a famous philanthropist and one of the largest contributors to the Democratic Party in the United States.
In 2010, he had collected about 58 billion dollars in until now unknown ‘Lord Jim Trust Foundation’ in the tax haven of Bermuda.
Documents from 2010 which are now leaked show that the fund was expected to grow to approximately NOK 117 billion this year and NOK 273 billion in 2030.
Law firm central
The law firm Appleby, which the bulk of the leakage stems from, has handled the wealth of Simons and other extremely wealthy people in various tax havens.
The documents give a unique insight into how foundations can be powerful tools for rich people who want to hide their values and make them grow in secret.
A foundation can add layers upon layers that eventually become a chain of ownership. And some foundations, like Simons’, are considered to be taxable abroad even though they manage the assets of an American citizen.
Foundations in tax havens constitute one third of Appleby’s business, according to an analysis of the leakages that ICIJI’s journal network has made. ICIJ has coordinated the review that over 90 media companies have made of the leaked material. The documents were first leaked to the German newspaper Süddeutsche Zeitung.
According to the leaked documents, it is especially popular to have foundations in Bermuda. Appleby has a customer with three foundations, two in Bermuda and one in the Bahamas, at a total of NOK 58 billion. It is not known who this customer is.
Claims he pays tax
In a written comment, Richard Simons says he does not try to avoid tax. Payments from Lord Jim Trust to him and his family are reported on tax returns and taxed in the United States, he points out.
From the leaks, it appears that 120 politicians from 50 countries have moved money to tax havens. A total of 25,000 people are mentioned in the leaks. 1,000 of them are supposedly Norwegian.
© NTB Scanpix / Norway Today