Why are there no big American names in Pandora Papers?

Laws in Nevada, South Dakota now rival most lax offshore tax havens

The latest release of the Pandora Papers has provided a window into the strategies used by the ultra-wealthy and powerful to hide their assets from tax authorities.

The investigation, undertaken by several major news organisations and spearheaded by the International Consortium of Investigative Journalists, revealed a system of tax evasion that includes states in the US but did not implicate any major US businesses or political figures.

While prominent Americans largely escaped the investigation’s gaze, the United States itself did not, as researchers found that the US now serves as an overseas tax haven for many.

Experts told NPR that the US’ low tax rates (compared to other developed nations) contributed to the findings, which indicated that some Americans simply found no need to stash money abroad; others were found to be likely using companies whose finances were not revealed in the latest batch of documents.

And some Americans still use the same methods to hide assets when under investigation or facing lawsuits, the Washington Post found, though none were named specifically.

“The records also show how a firm in Central America became a one-stop shop for American clients, allowing them to conceal their assets while facing criminal investigations or lawsuits,” the paper reported.

US businesses largely escaped the probe’s critical eye, but the same could not be same for local jurisdictions. State governments, in particular the governments of Nevada and South Dakota, were faulted for allowing their states to become tax havens where foreign nationals used companies based in the state to move money without notice.

South Dakota and Nevada "adopted financial secrecy laws that rival those of offshore jurisdictions”, researchers wrote, according to NPR, which noted the “explosive” growth of such schemes in the US.

One user of the US for tax purposes appeared to be Jordan’s King Abdullah II, who was found by the probe to own valuable properties worth more than $100 million in total in Washington DC and Malibu, California.

Jordan’s government issued a statement to Reuters denying wrongdoing.

It is "no secret that His Majesty owns a number of apartments and residences in the United States and the United Kingdom. This is not unusual nor improper,” stressed a spokesperson for the Jordanian government.

"The cost of these properties and all related expenditures have been personally funded by His Majesty. None of these expenses have been funded by the state budget or treasury,” the spokesperson added.

Russia’s foreign ministry was among the first to ridicule the US over the findings of the investigation, calling it a black eye on the face of US efforts to encourage anticorruption efforts in Europe and elsewhere.

“What catches the eye is which country is the world’s largest lagoon. This, of course, is the US,” said Dimitry Peskov, Russian President Vladimir Putin’s press secretary.

“This does not correlate at all with their declaration about the fight against corruption … We see that the U.S. is the main tax lagoon for the whole world,” Mr Peskov said.