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Summary

  1. The leak, dubbed the Paradise Papers, contains 13 million documents
  2. Prince Charles' offshore financial interests revealed in latest wave of stories
  3. Tax affairs of British island territories under the spotlight
  4. US tech firm Apple has secret tax bolthole in Jersey, papers reveal
  5. EU finance ministers call for a blacklist of tax havens
  6. Trump's commerce secretary selling shares in firm with links to Russia

Live Reporting

By Dan Macadam, Ian Westbrook, Bill Wilson and Mary-Ann Russon

All times stated are UK

Paradise Papers live coverage: evening summary

Prince Charles
BBC

We are going to finish our coverage at the end of day three of the Paradise Papers revelations.

The huge trove of leaked documents has made headlines around the world on the offshore financial affairs of hundreds of politicians, multinationals, celebrities and high-net-worth individuals.

Here are today's top stories so far:

They came after a wave of stories on Monday, including:

And the stories on day one revealed:

Britain's offshore secrets exposed

The revelations from the Paradise Papers, a leak of more than 13 million documents combed over by nearly 100 media groups, has stunned the world and shone a light on the financial affairs of the wealthy and powerful.

If you missed the two special BBC Panorama episodes which laid bare many of the biggest stories from the leak, you can still catch it on iPlayer.

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Prince's climate-change views 'well known'

Prince Charles
Getty Images

A bit more on the revelation from the Paradise Papers that Prince Charles campaigned to alter climate-change agreements without disclosing his private estate had an offshore financial interest in what he was promoting.

On Tuesday, a spokesman for the Prince denied that Charles had spoken out on the climate-change deals in order to benefit financially.

"The Prince has never chosen to speak out on a topic simply because of a company that The Duchy may have invested in," he said. "In the case of climate change his views are well-known, indeed he has been warning of the threat of global warming to our environment for over 30 years."

The spokesman added that carbon markets were just one of many strategies Charles had championed since the 1990s to try and slow the pace of climate change.

Oil firm uses tax haven 'shell' company

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Ithaca Energy set up a shell company on Bermuda in 2012 to buy its share in a $50m (£38m) North Sea oil production platform.

In the leaked papers, Ithaca stated it was "important" to its tax position the company was controlled from Bermuda.

Les Thomas, the chief executive of Ithaca, spoke to BBC reporter Mark Daly about the arrangement outside the firm's Aberdeen office.

The problems facing an EU tax blacklist

BBC News Channel

Estonian Finance minister Toomas Toniste
Getty Images
Estonian Finance minister Toomas Toniste says there's "strong support" for a tax blacklist

BBC correspondent Kevin Connolly says that if European finance ministers are going to pull together a list of tax havens and companies who are avoiding tax (see our post at 17.03), they must be prepared to act on it.

He told the BBC News Channel: "There are obvious targets - the usual suspects sometimes referred to in this sort of debate like those small Caribbean islands, like Panama and like other countries like that where large amount of financial business are transacted, which are not related to the local economy.

"It is one thing to produce a blacklist - pretty much anyone can do that - there is a huge question then about what you do to those blacklisted companies and of course for the EU in particular, there are also issues over the tax arrangements that some member states have made."

Prince Charles’s offshore investments revealed

Paradise Papers: Prince Charles’s offshore investments revealed

Prince Charles’s private estate secretly invested in an offshore company which lobbied to change climate agreements.

Isle of Man 'responsible for own fiscal matters'

House of Commons

Parliament

Mel Stride
HoC

Financial Secretary to the Treasury Mel Stride responds to the concerns outlined by Dame Margaret Hodge, paying tribute to her as a "determined campaigner".

He says the government takes all allegations of tax avoidance and evasion "very seriously". He points out that the Isle of Man has "separate democratic institutions responsible for their own fiscal matters".

Mr Stride notes that the British Crown Dependency is conducting a review of VAT and the importation of aircraft, which he welcomes.

He further observes that journalists have not turned over details of the Paradise Papers requested by HM Revenue and Customs.

UK 'subsidising tax haven'

House of Commons

Parliament

Dame Margaret Hodge
HoC

The Isle of Man's low-tax system has come under intense scrutiny following revelations in the Paradise Papers documents.

Dame Margaret Hodge calls on the government to publish details of a formula which sees the UK government paying the island for the VAT it should generate, even if that's not the amount that's collected.

She tells parliament that the payments of about £300m a year "support and subsidise it as a tax haven".

How money is diverted from poor countries

There's a special File on 4 episode on the Paradise Papers in 10 minutes on BBC Radio 4. It's looking at how money is transferred out of the developing world and into the pockets of the rich.

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'Poor oversight tarnished Queen's reputation'

House of Commons

Parliament

Queen Elizabeth II
BBC

Dame Margaret Hodge says she's in "no doubt the Queen was as appalled as the rest of us" at discovering her money was invested offshore.

The Paradise Papers showed that the Duchy of Lancaster, which provides the Queen with an income, held about £10m in the Cayman Islands and Bermuda.

"With proper transparency of the Duchy of Lancaster's affairs this would never have happened.

"If Treasury had properly monitored the financial affairs of the Duchy, the Queen's reputation would not have been tarnished," Dame Margaret says in the House of Commons.

She adds: "The fact that the Queen's financial advisers saw nothing wrong with investing offshore in dodgy companies shows how deeply entrenched and acceptable the practices of hiding wealth offshore and avoiding tax have become."

Newsnight has more on Paradise Papers...

'No knighthood for Lewis Hamilton'

House of Commons

Parliament

Lewis Hamilton
AFP

Labour's Dame Margaret Hodge opens her parliamentary debate on the Paradise Papers by saying they reveal a "completely toxic mixture" of wrongdoing involving money.

She goes on to say: "It must be completely obvious to us all that anybody who is found to have used artificial financial structures offshore simply to hide their wealth and avoid tax should not be awarded with an honour from the Queen.

"Lewis Hamilton should not receive a knighthood."

It recently emerged via the Paradise Papers documents that the Formula 1 champion avoided tax on his £16.5m luxury jet by importing it to the Isle of Man in 2013.

MPs discuss Paradise Papers

A debate on tax avoidance is underway in the House of Commons

‘There's a serious conflict of interest’

A former chairman of the Committee on Standards in Public Life has said Prince Charles' actions amounted to a serious conflict of interest.

Sir Alistair Graham says Prince Charles should be accountable to public scrutiny. The committee, which he chaired from 2003 to 2007, advises the prime minister on ethical standards across public life in England.

BBC Panorama has found that the Prince of Wales campaigned to alter climate-change agreements without disclosing his private estate had an offshore financial interest in what he was promoting

His private estate says the prince had no direct involvement in its investments. A Clarence House spokesman said the prince had "certainly never chosen to speak out on a topic simply because of a company that it may have invested in".

Paradise Papers: All you need to know

Paradise Papers graphic
BBC

The investments of Prince Charles' private estate are the latest to be revealed in the data leak dubbed the Paradise Papers.

The financial affairs of hundreds of politicians, multinationals, celebrities and high-net-worth individuals, some of them household names, have been revealed.

For a full recap on what's been uncovered so far, click here.

Tycoon made $41m from Angolan 'people's fund'

Jean-Claude Bastos
Shutterstock

The stories from the Paradise Papers are coming thick and fast.

The leaked documents also reveal that an entrepreneur charged with managing the oil wealth of the struggling African state of Angola was paid more than $41m in just 20 months.

The payments were made via a complex web of companies set up in the offshore jurisdiction of Mauritius.

Jean-Claude Bastos also used his position to help set up large investment deals he stands to further profit from, the Paradise Papers show.

All sides deny any wrongdoing.

Read our full story here.

Blackstone avoided UK taxes on property deals

St Enoch shopping centre in Glasgow
BBC

Private equity firm Blackstone avoided tens of millions of pounds in UK taxes on property deals in Glasgow and London, the Paradise Papers show.

The documents reveal it used offshore companies to purchase and operate the St Enoch Shopping Centre in Glasgow (pictured) and Chiswick Business Park in London.

The papers show how accountancy firms mapped out strategies to minimise or avoid every significant tax.

Blackstone said its investments were "wholly compliant with UK tax laws".

Read the full story here.

Prince Charles' offshore investments

Paradise Papers reveal details of the prince's private estate

Graphic of Prince Charles' investments
BBC

BreakingPrince Charles lobbied on policy after shares buy

Prince Charles
Getty Images

Prince Charles campaigned to alter climate-change agreements without disclosing his private estate had an offshore financial interest in what he was promoting, BBC Panorama has found.

The Paradise Papers show the Duchy of Cornwall in 2007 secretly bought shares worth $113,500 in a Bermuda firm that would benefit from a rule change.

The prince was a friend of a director of Sustainable Forestry Management Ltd. The Duchy of Cornwall says he has no direct involvement in its investments.

Read the full story here.

'Reputation matters a lot' - Jersey tax expert

Ryan Morrison

BBC News Online

John Shenton
BBC

John Shenton, a Jersey tax expert, says the Paradise Papers story could harm the island's reputation. "There is nothing to suggest anybody has done anything wrong, anybody has done anything illegal or Jersey has done anything wrong," he said.

"What you have is a perception - it is hard to change perception - that something isn't right here.

"Reputation matters a lot and it is very difficult if somebody sullies your reputation, it is hard to get it back," he added.

The Paradise Papers contain 13m documents obtained from law firm Appleby and others. Appleby described it as an "illegal data breach" and as a hack.

One document revealed Apple registered as a tax resident of Jersey in 2015 after a law change in Ireland. Apple says they didn't transfer any money out of Ireland in 2015.

India 'to look into Paradise Papers'

Man waves an India flag
AFP

We've focused a lot on the Western celebrities and companies whose tax affairs were uncovered in the Paradise Papers leaks. But there were revelations in other countries too, including India.

The documents shed light on the financial holdings of more than 700 Indian entities and individuals.

India's Finance Minister Arun Jaitley said the government would consider each case on its "individual merit".

"It will be found out... who are those people with totally illegal accounts and who have [a] plausible defence," the Press Trust of India reported Mr Jaitley as saying.

The tax professionals' reponsibility

In the controversy over the Paradise Papers, questions have been raised about the role of professionals in the creation and facilitation of tax avoidance schemes.

There are multiple measures in place already to prevent lawyers and accountants establishing and marketing such schemes.

But are they making an impact?

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Ministers push for tax blacklist

EU flags
Getty Images

European finance ministers have been talking about the fallout from the Paradise Papers at a meeting in Brussels.

Many of them are now calling for a blacklist of tax havens to be drawn up for approval next month, to tackle what they see as tax dodging by the rich and famous.

Underlining the difficulty of such an approach, however, there were questions about how to impose sanctions on countries that help tax avoidance, which is often legal.

"There was strong support for the idea of moving forward quickly," said Estonia's finance minister Toomas Toniste, who holds the EU's rotating presidency.

He added that "most countries" wanted the adoption of the list next month - although it's thought that not all of the EU's 28 countries are equally keen to go that fast.

Would you avoid tax?

Nearly half of Brits would take up an offer to cut their tax bill in a non-illegal way, according to YouGov pollsters.

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Who is a tax dodger?

Paradise Papers artwork
BBC

The Paradise Papers documents have lifted the lid on the tax affairs of the rich and powerful. But many tax experts have been at pains to point out that not all the deals are illegal.

Mark Davies, a chartered tax adviser who offers services in offshore finance, tells the BBC some of the cases involve "tax evasion" and others involve "tax avoidance".

Tax evasion is dodging tax that is due, while tax avoidance involves "taking steps to avoid paying tax so that it isn’t due" - a move that isn't illegal, Mr Davies says.

Some of what BBC Panorama uncovered seems to be illegal tax evasion and needs to be pursued by HMRC, he concludes.

Ireland 'tax-compliant', says PM

Irish Prime Minister Leo Varadkar
Reuters

Irish Prime Minister Leo Varadkar has said the country is an "international leader" in tackling tax avoidance.

Earlier, opposition politicians called for Irish tax officials to come before lawmakers to discuss the fallout from the Paradise Papers. Ireland's corporation tax rate of 12.5% has helped attract major multinationals to set up bases in the country.

Speaking in the Irish Parliament, Mr Varadkar said the OECD had identified Ireland as one of only 22 countries which were entirely tax compliant.

He said Ireland had closed tax loopholes recently, but added: "It is constantly a game of cat and mouse."

Stay tuned

BBC Scotland will have more revelations from the Paradise Papers

EU calls for urgent action on tax havens

Pierre Moscovici talks to UK Treasure Secretary Liz Truss
EPA

Pierre Moscovici, the European Commissioner for financial affairs and taxation, has called for immediate action over tax havens as European finance ministers meet in Brussels.

The ministers have brought forward talks about drawing up a blacklist of tax havens following the release of the Paradise Papers.

And Mr Moscovici (pictured left with UK Treasury Secretary Liz Truss) said: "It's high time that the political authorities act even more. We've done a lot in recent years but we need to do more.

"It is high time that we have a blacklist of tax havens before the end of this year. It must be effective and credible and it must be sorted with sanctions if necessary."

'We're not a tax haven'

Castletown, Isle of Man
Getty Images

Residents of the Isle of Man do not recognise the description of their home as a "tax haven" and want to see more evidence, says BBC North of England correspondent Judith Moritz.

She told the News Channel that although there are nearly 1,000 private jets registered on the island - more than are registered in France, reportedly - the locals say that is because their "jet registry is a world leader".

Isle of Man's financial hub

Isle of Man financial and legal services
BBC

This is the centre of the Isle of Man’s financial district. The island, with its population of less than 85,000, has more than 30,000 registered companies.

Some 17% of the island’s income comes from banking, finance and business services and the same proportion comes from insurance.

The Paradise Papers leak has shone a spotlight on the island - which stresses that it doesn't welcome those "seeking to evade or aggressively avoid taxes".

Jersey requests Paradise Papers for review

Ryan Morrison

BBC News Online

Jersey's chief minister has asked the International Consortium of Investigative Journalists for a copy of any Paradise Papers documents relating to Jersey.

Ian Gorst says he wants financial investigators to find out if any laws have been broken.

He says companies should only have tax residency if they have a "substantive presence", which includes employing staff.

Ian Gorst
PA

If what we have heard in the media proves to be abusive or aggressive avoidance then we will take action. I have asked for a review by the regulator into this. Companies operating in Jersey should show substance."

Seantor Ian GorstJersey Chief Minister

Isle of Man says tax laws 'transparent'

The House of Keys
BBC

The Isle of Man has said it does not welcome those "seeking to evade or aggressively avoid taxes", following the Paradise Papers revelations.

Its tax practices have come under scrutiny after documents showed Formula One champion Lewis Hamilton avoided tax on his £16.5m luxury jet by importing it via the island in 2013.

Chief Minister Howard Quayle said the Isle of Man was "open and transparent".

The UK Treasury is now investigating the importation of jets to the island.

You can read more of this story here.

Paradise Papers revelations span the globe

Michael Hutchence
Getty Images
What happened to Michael Hutchence's reputed millions remains a mystery

The latest release of the Paradise Papers has shed light on the financial hideaways of iconic brands and figures around the world.

In one case, the papers show a deal to cash in on Australian rock star and lead singer of INXS, Michael Hutchence, who killed himself in 1997.

According to ABC, the singer's former lawyer, Colin Diamond, legally set up a company in Mauritius in 2015 with the aim of "commercial exploitation of the sound recordings, images, films and related materials embodying the performance of Michael Hutchence".

Elsewhere, Turkish Prime Minister Binali Yildirim's family members, including his two sons, are alleged to have offshore investments in Malta, according to Turkish opposition newspaper Cumhuriyet.

There have also been revelations in India, Bolivia, Pakistan and Japan, among others.

Appleby 'sets aside payments'

The law firm at the centre of the Paradise Papers leak has earmarked $500,000 to pay a fine to financial regulators in Bermuda, according to press reports on the island. The report says that Appleby and Bermuda regulators haven't yet commented.

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'Everyone wants to get the investment'

Paradise Papers Apple tax avoidance
BBC

The Paradise Papers show that in 2013, Apple avoided a crackdown on its controversial Irish tax practices by moving the firm holding most of its untaxed offshore cash to the Channel Island of Jersey.

Rita de la Feria from the University of Leeds says the leaked documents show the lengths companies will go to in order to avoid paying billions in tax.

"I think this is essentially like written evidence of something that we all kind of know is happening, with essentially a wide tax competition amongst various jurisdictions around the world for investment," she told the BBC.

"Everyone wants to get the investment so basically the multinationals take advantage of that fact and essentially make countries compete for that investment through tax."

Hear Guernsey minister on Wake Up To Money

Wake Up To Money podcast page
BBC

Guernsey chief minister Gavin St Pier spoke out on the Paradise Papers on Tuesday's Wake Up To Money.

You can hear him on the podcast here.

Oxfam proposes five steps 'to end tax scandals'

House of Commons
PA

Charity Oxfam is now urging the UK government to:

  • Use the forthcoming Budget to commit to introduce public country-by-country reporting for all multinational companies operating in the UK
  • Ensure the UK’s overseas territories and crown dependencies introduce public registers of company beneficial ownership
  • Give developing countries access to tax and company data
  • Ensure that UK corporate tax rules do not incentivise companies to avoid tax in developing countries
  • Show international leadership on tackling tax avoidance

Jersey 'doesn't want abusive tax avoidance' says chief minister

Ryan Morrison

BBC News Online

Companies should have a substance in Jersey if they want to claim tax residence says Jersey's chief minister.

Senator Ian Gorst was responding to a Panorama report that claims Apple became tax resident in Jersey after changes to Irish law required them to have a tax residency somewhere.

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Apple used Jersey 'to preserve tax due to US government'

Ryan Morrison

BBC News Online

Apple says it placed money in Jersey to preserve tax revenue it owed to the US government.

In a statement on its website, the world's largest company rejected some of the claims in the Paradise Papers by the International Consortium of Investigative Journalists.

Apple
PA

After the EU announced in 2013 that it was investigating Apple's Irish arrangement, the Irish government decided that firms incorporated there could no longer be stateless for tax purposes.

In order to keep its tax rates low, Apple needed to find an offshore financial centre that would serve as the tax residency for its Irish subsidiaries.

In a statement Apple said: “Apple’s subsidiary, which holds overseas cash, became resident in the UK Crown Dependency of Jersey, specifically to ensure that tax obligations and payments to the US were not reduced.

"Since then Apple has paid billions of dollars in US tax on the investment income of this subsidiary.

"There was no tax benefit for Apple from this change and, importantly, this did not reduce Apple’s tax payments or tax liability in any country."

More revelations on shell companies to come

On Thursday, Transparency International UK will publish new research on British companies that perform legal services similar to Appleby and Mossack Fonseca.

The NGO is calling on the UK Government to:

  • Publish the Anti-Corruption Strategy that was promised in 2016
  • Ensure the Overseas Territories and Crown Dependencies come into line with international good practice
  • Implement the long-delayed register of the owners of overseas companies purchasing UK property
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