Gareth Vaughan argues PM John Key is failing in his role as promoter and custodian of NZ's international standing and reputation over the Panama Papers

By Gareth Vaughan

One of the key (no pun intended) roles of this country's Prime Minister, in my opinion, is to act as a promoter and custodian of New Zealand's international standing and reputation.

After all, we are a small country at the bottom of the world with no real enemies, and a country most people you meet when overseas have a positive view of. Assuming they've heard of us of course.

However, New Zealand's role in the Panama Papers is putting the spotlight on the dark side of our good international reputation, highlighting that it's ripe for exploitation by overseas tax dodgers, asset hiders and straight up criminals. Previously I suggested Key's attitude towards NZ offshore trusts was stuck in a time warp. Additionally I now believe his "nothing to see here, move along" attitude towards the Panama Papers risks bringing the office of Prime Minister into disrepute.

Because why would a Prime Minister with New Zealand's best interests at heart not: 1) Acknowledge there is a problem, 2) Condemn unethical, immoral and illegal activity exposed through the Panama Papers, and 3) Fully commit to wide sweeping action to shore up the flawed laws that allow our reputation to be dragged through the mud?

Granted, Key and his government have appointed former PwC chairman John Shewan to review foreign trust disclosure rules. But they were reluctant to do so and still give the impression they don't believe there's much to fix. And the terms of reference, as highlighted last week by Transparency International NZ, are narrow.

The tip of an iceberg

It's important to put the Panama Papers in context.

Mossack Fonseca, the Panamanian law firm the Panama Papers were obtained from, is merely one of dozens of entities selling NZ's flawed trust laws and legal loopholes to the world. In 2012 Cabinet was told the Companies Office monitored 77 trust and company service providers who had created many of the 1,200 companies categorised as “high risk” by the Companies Office. Mossack Fonseca may well have been among the 77, although its local offshoot, Mossack Fonseca & Co. (New Zealand) Ltd, wasn't incorporated until December 2013. 

The key points are that Mossack Fonseca's activities are just the tip of an iceberg, and its apparent vehicle of choice, the NZ foreign trust, is but one method of doing what it does.

Other NZ tools to achieve secretive or nefarious ends include the look through company, which has also been sighted in the Panama Papers and enables non-resident shareholders to avoid paying tax in NZ so long as their income is derived offshore. These companies can trade and open bank accounts all around the world. 

And there's our financial service providers register through which NZ registered companies can operate overseas as NZ companies, but face no regulatory oversight here. With NZ registered but offshore operating financial service providers we are effectively issuing drivers licences for anywhere in the world except NZ.

A series of well documented international embarrassments caused by NZ registered companies, kicked off by SP Trading Ltd chartering a plane to carry North Korean arms and explosives to Iran in 2009, woke the Government up to the fact NZ's good international reputation was under threat. Key planks of this reputation include consistently being ranked one of the least corrupt countries in the world in Transparency International's Corruptions Perception Index, and being regarded as one of the easiest places in the world to do business by the World Bank.

With this reputation in mind note that in 2011 then-Commerce Minister Simon Power pointed out over four years 143 NZ registered companies were implicated in criminal activities overseas such as smuggling, money laundering and tax fraud with New Zealand Police and the Customs Service receiving 134 enquiries about them. And risks were again clearly spelt out to Cabinet in 2012 when the Government was in the process of introducing a law making all local companies have a NZ or Australian resident director:

"Since 2010, the New Zealand Police Financial Intelligence Unit and Interpol have received 171 requests for assistance regarding 248 companies allegedly facilitating crimes. This averages at more than eight companies a month, a significant increase from the rate of less than three companies a month between 2006 and 2010. In almost all cases, limited information is able to be provided concerning the activities of the companies concerned, or who ultimately controls them."

"There is evidence that individuals and groups (particularly offshore interests) are misusing the New Zealand company incorporation regime and consequently threatening the international reputation of New Zealand. High profile or repeated instances of foreign controlled New Zealand companies engaging in criminal activities overseas are likely to seriously impact New Zealand’s international standing." 

"The primary causes of this increase in misuse of New Zealand’s company registration system are:
a. The unprecedented promotion of New Zealand incorporated companies to wholly overseas interests by trust and company service providers (TCSPs);
b. The lack of information required about the beneficial ownership and control of New Zealand companies in comparison to similar well regulated jurisdictions such as Australia; and
c. The ability of persons based overseas to register a company in New Zealand via the internet or a TCSP, with no substantive link to, or apparent intention of operating in, New Zealand.

Flawed comments

Several of Key's comments yesterday are frankly flawed. For one, describing NZ as nothing more than a footnote in the Panama Papers. Given NZ apparently receives 61,000 mentions that's a pretty long footnote. It's also a lot more mentions than numerous other countries get.

And saying NZ was hardly mentioned in global news reports about the Panama Papers is also flawed. The Australian Financial Review, whose reporter Neil Chenoweth had access to the Panama Papers ahead of any NZ journalists, has - in articles - described NZ as a "quiet tax haven achiever", and detailed a reference provided by Key's personal lawyer Ken Whitney to Mossack Fonseca. (That's the same Whitney who seemingly helped convince Revenue Minister Todd McClay to block IRD's plans to review NZ's foreign trust regime a couple of years ago).

Now, last I checked the AFR is a serious publication, and Australia is NZ's key international ally and, alongside China, our key trade partner. Hence the image of NZ within Australia carries significant importance for New Zealanders.

Over the weekend Key also gained the dubious distinction of being the only politician directly named in the first public statement made by the Panama Papers "whistleblower." It would be fair to say that statement received a reasonable amount of international media coverage.

Key and his ministers have also been at pains to argue that NZ is not a tax haven despite this country being named as one of 21 global tax havens Mossack Fonseca operates in. NZ may not be a tax haven for kiwis, but it clearly is for foreigners given through our foreign trusts local lawyers and accountants (for a fee) will help foreigners hide money and assets from their domestic tax authorities. (Here's the scant foreign trust disclosure currently required by IRD).

The reality is that by being named among 21 tax havens, if anything, we are punching above our weight in this arena.

'A material impact on the future of NZ's standing in the world'

Transparency International NZ issued a strongly worded statement last week saying the Shewan Inquiry will have a material impact on the future of NZ's standing in the world. It also argued the terms of reference mean the inquiry will merely investigate foreign trusts rather than tackle the broader spectrum of financial crime risks associated with NZ companies and trusts arguing "the transparency of all corporate vehicles, including foreign trusts, is essential to prevent and detect serious crime potentially involving billions of dollars such as money laundering and ill-gotten asset transfers and other forms of international corruption."

Transparency International recommends the Anti-Money Laundering and Countering Financing of Terrorism Act (AML-CFT Act) be extended to cover all professionals including lawyers and accountants engaged in establishing and managing NZ corporate vehicles. To this I'd add real estate agents.

There is some hope that the so-called phase 2 of the AML-CFT Act, that would extend it in this manner, may finally actually happen. In his post cabinet press conference yesterday Key said the Government would "accelerate it." This has, however, been a real slow burner. As long ago as October 2014 the Ministry of Justice said policy work for phase 2 was underway. And in July last year Justice Minister Amy Adams said the Ministry had begun preliminary policy work. So although an acceleration would be welcome, it's out of a very slow lane.

Transparency International's also calling for a corporate registry that includes beneficial ownership of relevant business structures to enable review and audit by law enforcement and compliance bodies. And it went on to say: "The Shewan Inquiry will have a material impact on the future of New Zealand's standing in the world and on our collective prosperity."

After years of tinkering around the fringes of the problem, the Ministry of Business, Innovation & Employment (MBIE) is currently undertaking a review of misuse of NZ's Financial Service Providers Register. See all our stories on this here. Wouldn't it make sense to broaden this out to include a detailed probe of foreign trusts, look through companies, rogue building societies and any other corporate structures deemed likely to be exploited in the way foreign trusts clearly can be? Let's also look at why it is that the likes of Mossack Fonseca's local arm can operate without having to comply with the AML-CFT Act.

Take the initiative

In the future it's likely that the OECD’s automatic exchange of information (AEOI) tax initiative will enforce greater disclosure on NZ foreign trusts such as who owns the assets held within them. And we'll have to share more such information with other countries proactively.

But wouldn't it be preferable for NZ to be taking the initiative with the Government acknowledging we actually have a problem and proactively looking to resolve it?

Who knows, our inclusion in the Panama Papers as one of Mossack Fonseca's 21 tax havens may, in some quarters, even count against Helen Clark's push for the top job at the United Nations, something Key's government is rightly supporting in a bipartisan manner. 

Unfortunately it seems unless his polling's telling him to worry, Key simply doesn't care, as noted in a Newshub article about Key's relationship with Whitney last week.

 Mr Key's weathered a number of controversies the past few years without losing the public's support in the polls. He has a simple explanation why. "They don't worry about this stuff." 

Thus I urge anyone who has the ear of any National Party MPs, or is quizzed by anyone polling for the party, to tell them you do care about NZ's role in the Panama Papers. That may just help drag the Government kicking and screaming towards making meaningful change. Otherwise it may become a case of rebuilding our reputation rather than protecting it.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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80 Comments

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The major Australian newspapers and other media there have no difficulty in identifying New Zealand as a Tax Haven. Our Prime Minister should stop trying to deny this reality and get on with repairing some of the damage done to this country's reputation.

Really they undoubtedly have the same quality of so called journalists as we have here "useless"

It's natural they want to deflect; big Aussie companies like BHP, Amcor and ANZ are on the list.

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Spot on he has tarnished brand NZ and it showed up in the corruption index where nz dropped several places well before these papers were released.

It will take a long time to gain back the position we once held. All for how much ? 25m a year of fees? Was it worth it ? Also can't see why the government stopped the IRD review.

Yes I wouldn't be surprised if we dropped down to the same level as our major trade partners from 4th place to 83rd place when this all comes out in the wash.

https://www.transparency.org/cpi2015/#results-table

It would be very interesting to see how much of that 25m ends up in government coffers, versus how much it costs the IRD to police and maintain the system. Is there even a net benefit to the country in financial terms?

Where's the real money trail, how's it hidden, and who's it going to? All this lobbying and pressure for a few million a year? I doubt it.

@mfd The income tax on that amount earned by the lawyers and accountants. And being overseas supply I guess no GST.

I assume the $25 million is revenue rather than profit, so tax not collected on the full amount. Given their profession, I expect the tax paid is comfortably under 33% of that total.

Brand NZ,Clean Green image names made up by advertising guru's who no doubt have Trusts to avoid paying their fair share of tax.

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its like Mr Key is more active helping foreigners prosper than kiwis or am i seeing this from the wrong angle...

No you're not, that's exactly what is happening.

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Firstly, congratulations Gareth on being the journalist who has been on this issue for ages when no one else was. Along with Bernard leading the debate around housing and taxation issues, IMHO Interest.co is fast becoming the place where important debate is led.

I couldn't agree more with the sentiments expressed regarding the cavalier disregard for New Zealand's international reputation. The problem with Key and his poll driven obsession is that his first instinct is to spin the messaging which stops him actually constructively leading. It also clouds the opposition because they have become so obsessed with getting a hit on Key to dent those same polls that they often lose the opportunity to highlight the bigger picture in their haste to discredit him.The losers are New Zealanders who are robbed of considered public debate.

Why Key has been so defensive on this particular issue stems from him having actually championed the particular industry as highlighted by MortgageBelt yesterday in this revealing link.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1069...

When you think about it apart from cycleways, becoming a' financial hub' has been Key's only real unique vision for this country.

A financial hub is his only vision and it's one that generates very little work or financial benefit for the nation.

Is it that someones post-retirement commercial visions being seized upon?
In a Tony Blair sort of way.
Who is down to play the Gordon Brown role, is she there in the wings.

Thanks for the link Sheep Shagger. Fascinating, back then it seemed the only real issue was if making it tax free for foreigners would not affect our tax base, then it's all on. Little wonder the Aussies told us to carve their citizens out from this institutionalised tax rort. It would be interesting to see IRD advice at that time. They tend to say things straight. Maybe something like "it will not affect our tax base, but it will undermine the tax base of every other country in the world (except Australia) whose citizens use it to evade taxes."

I agree wholeheartedly.
Why do we even have the Herald or Dominion, anymore. Their headlines only ever prove to be tabloid centric, anymore. God only knows how they are going to fill the void of the Bachelor, now that that finally come to an end.

All the true financial and business headlines are being pushed further down the order, if they are even picked up on at all.
No one pulls JK and his incompetent cronies up for their almost weekly about-turns on washed over but important topics.

The Key method is almost always 'once over lightly'
Then when the soft ground under him shifts, he provides us with another 'in my view'
However do not ever expect much and you will not be disappointed.

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JK is of the mindset that you do whatever you can in business to make a buck. Good business in his eyes in not paying tax, that is what his core beliefs and values are, selfish and greedy

If I was an aid and abetting man, I would be locked up and the key thrown away.

If you are the administer of all ye survey, a free pass, if ye make the rules and others bend em to your will, your trust, your agenda, your south seas view of things.

Seems fair.

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Nice piece Gareth. Sad that you even had to write it. I can't fathom why the PM is steadfast ignoring simple facts.

To say we are not a tax haven is right, for kiwis. But for foreigners using kiwi offshore trusts, its perfectly suited to evade their taxes. For then, we are a tax haven. Simple fact. Saying it isn't so doesn't change the fact that we just are. 

Likewise that the OECD hasn't labelled us a tax haven. Perhaps only because until now they didn't know how NZ offshore trusts were being used. Do we need to wait until the OECD review their current data and then label us one? Far better, it seems to me, to fix it (one such solution already canvassed here and in Listener in detail), so that they don't list us, than trying to claw back, and never lose the tag.

Likewise, IRD looked around and not many countries are bad-mouthing us, so our reputation is fine. Really? Most countries are completely focused on their own people involved, so other countries don't get a look in. Even so, we are getting mentioned. In Spanish TV news, NZ was treated as a joke. In Malta, NZ's reputation is completely trashed, in month-long wall-to-wall coverage of politicians using NZ trusts. As you say, the only world leader named in the whistleblower's manifesto. That's been published nearly everywhere in the world, with John Key and New Zealand in lights. So too the map showing 21 tax havens, with a big dot on NZ. That has been plastered everywhere too. So it's very perplexing how it can be said, IRD looked, not many mentions, our reputation is fine. It just isn't. Clearly. And it can only get worse the longer we don't address the actual issue.

Moreover, the real issue is what's not visible, and the future. Those who support other candidates for the UN top job won't announce anything publicly, they'll just quietly do their best to trash Helen Clark's prospects behind closed doors. John Key knows this is how it works, so it is all the more perplexing.  And it is the future that matters, when the map of tax havens becomes part of the international fabric.Far better to stop the rot decisively and quickly than trying to resurrent a reputation afterwards.

Excellent comments today Ron and the guy from down south. (Joke)

hmm... I suspect you refer to me Joe. I have had cause to reflect on the wisdom of that particular moniker for which I would like to point out was conceived around the time of the popular Hilux ads. But yes I do live down South!

What, lost in popular culture. We'd thought you'd looked to The Book of Revelations lamb like. Buggar.

Thanks Joe Public. Just trying as best I can (like Gareth, Bernard, and a good many insightful commentators on this site) to keep facts and real issues at the fore for genuine debate. Also completely apolitical.

Although the former feels rather like quietly explaining to a tsunami why it might prefer a different course.

And after my 'equal opportunity' piece in the Listener, casting equally across all political parties, I fear the latter rather seems to be focused on Key over the past few days. It's certainly not intended that way, it's just that's where the vast majority of misinformation seems currently to be centred. I do rather hope the others start spouting rubbish again soon, so that my own perception of apoltical fairness can resume.

Better still, that they start addressing the real issues, and we can have genuinely informed debate as a populace (thankfully, there are signs, a few, appearing, but so far, as far as I can tell from just two of the smaller parties).

Yes, excellent information and commentary, Ron, Gareth, Bernard, the interest team and others. Immeasurably valuable work.

Hey,
Im an auckland boy, born dominion road, but we moved around a bit..

As David reported in 90@9, the ICIJ has opened up limited public access to some of the Panama Papers this morning it's here https://offshoreleaks.icij.org/search?utf8=%E2%9C%93&q=&c=NZL&j=&e=&commit=Search
As the Herald has reported, Allan Hubbard's name crops up. Other local names there include Hanover Group & Trans Tasman Properties.

Here's the background on why Hanover's there from Matt Nippert - http://www.stuff.co.nz/business/8633328/Hotchin-denies-links-to-BVI-companies

a lot of links now emerging
Panama Papers: New Zealand Elvis impersonator linked to Iraqi oil scandal
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1163...

"It's everyday business for bankrupt Elvis impersonators to be trading Iraqi oil. They need it for their hair." - John Key

Congratulations Gareth. That whole article is a fine piece of work. Entirely reasonable and tough at the same time.

Well that's interesting because I found it the kind of one sided beat up the media produces on slow news days.

Is JK going to put NZ on the list of resistors along with the ... Cayman Islands?

Tax havens have no economic justification, say top economists

"British officials are locked in negotiations with the crown dependencies and overseas territories, trying to persuade them to agree to a form of automatic exchange of information on beneficial ownership of companies. So far the overseas territories have only agreed to allow UK law enforcement agencies access to a privately held register of beneficial ownership, but the automatic exchange agreement would give a wider range of countries access to information on the ownership of shell companies.

Many overseas territories including the Cayman Islands are resisting the idea, and their attendance at the summit is in doubt."

http://www.theguardian.com/world/2016/may/09/tax-havens-have-no-economic...

LOL, you do realise the 'Crown Dependencies' they are talking about are their own UK territories of Guernsey, Jersey and Isle of Man?

I am not sure the UK is the correct country to be holding a candle to anyone else.

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I'm going to say it again, at this point in time, I have more trust and respect for Vladimir Putin than I do for our PM.
And what rank is Russia in the corruption ranking list?

Surely you jest.

Does any know if those Overseas Hidden Trusts in NZ buy property in NZ? Auckland and the like?
The concern being if the locals have been on an un-even playing field, the damage of over commitment.

I don't know about anyone else but if i was an oil or gold man from Bolivia,Venezuela,Colombia,Ecuador or many other countries in that region i know where i would put my money and it wouldn't be one of those corrupt countries or for that matter Russia.Nationalisation not my cup of tea.
NZ gets the lot.

You mean something like this example:

https://offshoreleaks.icij.org/nodes/10209872

Lake View Properties Limited (NZ Jurisdiction) registered in Ecuador and intermediary of Carlos Hanze.

Of course it could be totally legit.............or not.

The money is seldom ever in NZ, we just provide the secrecy and/or evasion vehicle 

Anyone else reckon the dominant narrative will soon shift? Next phase might be along the lines: IRD have scoured it. The journalists have scoured it. No evidence any kiwis have evaded taxes. No proof of any illegality uncovered. It's all a left-wing smear. Nothing to see. Move along.

Overlooking any uncomfortable truths set out here earlier: http://www.interest.co.nz/opinion/81463/ron-pol-compares-nzs-foreign-trusts-criminal-getaway-car-manufacturing-industry-asks

Just a few:

Of course IRD won't find any kiwis misusing NZ foreign trusts, because kiwis can't use them.

Foreigners using NZ offshore trusts haven't breached our tax laws either, because they're exempt from tax, so there's nothing for IRD to prosecute (they may have evaded taxes in other countries, but that's not our problem it seems, nor for creating vehicles designed to undermine other countries' tax bases).

The MossFon files will also seldom spell out instantly reportable criminality, for a range of reasons outlined in that piece. Mostly instead it will expose only a great many threads that need to be followed by serious investigation, and more puzzle pieces to those that the relevant enforcement agencies already have, to start filling in the blanks and follow where the trails lead to detect, investigate and investigate criminality.

Finally, the PP issue is a tiny part of a much wider one - Base Erosion Profit Shifting. http://www.oecd.org/tax/beps.htm

And the way to get traction on That, is concerted international effort. Which sentence, the observant may notice, is a classic oxymoron....

Our humble role in the PP is as a facilitator of BEPS: the mechanism is perfectly straightforward.

  • Company C incorporates in jurisdiction A
  • It pays license or franchise or IP fees to Company X which just happens to be located in a offshore trust instrument which we may alias as PP.
  • The fee paid by C to X, by happy coincidence, reduces C's taxable profit in jurisdiction A to a smallish sum, with consequential effects on A's tax take.
  • PP is located in (what else) a Reputable Jurisdiction which we may deem NZ, which happens to have a double-taxation agreement with A
  • For offshore entities such as PP, NZ has a tax rate of zero.
  • PP's license fee income is duly taxed in NZ at zero, if declared at all, and this information, if collected at all, will be transmitted to anyone in jurisdiction A, if questions arise from Following the Munny, as 'NZ tax has been paid'
  • Wash, rinse and repeat for PP01, PP02 until someone notices.....

But as international bodies such as the UN (motto: "Let's hold Committee Meetings until They're All Dead") are notoriously unable to agree, let alone act, on much that is substantive, I wouldn't bet the farm on action on BEPS within this electoral cycle....or, indeed, within decades....

Thanks waymad, as a crime prevention/money laundering type my grasp of tax issues is mostly limited to the core elements of evasion as another form of criminality, with avoidance just beyond the edge, so this is really useful.

You mechanism loosely describes every sizeable international IT company I know. In Asia Pacific the head office is usually Singapore and the intellectual property licensing all ends up in places like Ireland and Switzerland.

But it has been that way for almost my entire working life.

I see Barry Soper in the Herald has had a crack at defending the indefensible on this subject, but the whole article was a bit limp and half-hearted.

Hamish Fletcher in the Herald saying it like it is (though I would say that), that advancing extension of AML to lawyers as a 'solution' to the foreign trusts issue is completely misplaced:

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11636674

Transparency - making something clear......It is clear to me that everyone wants to know everyone's business or there would be no calls for a register.

Trusts are wicked little entities people protect assets from prying greedy people......it just happens that they can also be used by crooks......using the concept that a register is in someway going to make positive change is silly......and there are hundreds of examples of where we have registers for other things but still have the issues we started with. So it is corrupting to suggest that a register is going to solve the problems highlighted.

At the moment these offshore trusts do not have to pay taxes in NZ so they are not paying anything towards the system here which offers them protection. We all end up subsidising that protection and you want to put our costs up by creating a register!!

so why did they allow them to purchase
Overseas Investment Office unsure who owns Onetai Station
The 1317 hectare farm was sold in 2014, on the advice of the Overseas Investment Office (OIO), to Ceol & Muir, a company established with the help of Panamanian law firm Mossack Fonseca
http://www.stuff.co.nz/business/industries/79802634/overseas-investment-...

An interesting take on the left's obsession with John Key, and trusts, from Chris Trotter here http://bowalleyroad.blogspot.co.nz/2016/05/the-number-of-beast-new-zealand-lefts.html

Perhaps a little perspective might go a long way.

For example if we accept inclusion in the Panama papers as all that is needed as proof of being that ill defined phrase 'tax haven', then we conclude the UK, USA and Canada are as guilty as we are.

Sorry that's just another version of " labour did it too".

Remember the good old days when New Zealand proudly set the standard as the least corupt nation in the world?

I submit to you that the level at which any given society is willing to practice and accept corruption has roots that are deeper than a simple political spectrum.

Gareth Chris Trotter has become an apologist for this administration.

He is used by MSM when they want to trot out a left wing view that will not scare the horses.

Chris Trotter's personal view of the tax haven issue is not that this will damage NZ's reputation because it shows NZ as lacking in morals. Which is pretty much the point every leftie makes (and many from the right too as apolitical Ron Pol points out). No Chris Trotter's view of NZ being a tax haven is 'meh'.

See for yourself here. http://www.newshub.co.nz/politics/panama-papers-reveal-not-a-critical-bl...

Thanks Brendon, I see at that link that he bases it on beliefs such as "It's got the disclosure rules in there, it's got the anti-money laundering rules in there."

The short answer is that neither is right.

The slightly more complicated one is that the normal disclosure rules don't apply to foreign trusts (except for Australians). And AML is not as relevant here (except as to heightening sensitivity, CDD). Lawyers are AML/CFT exempt, but company incorporation firms are already under AML/CFT, and either can set up such vehicles. The real issue is the design of the foreign trusts regime itself, which require very limited info. So, in a practical sense that or a bit beyond may be as far as many go, and if more is obtained than required to set it up, it's corralled behind privilege and in any event as MossFon says they have no idea what happens to it or what it does afterwards. So, AML is good and useful, but a bandaid isn't the answer when half a dozen strong sutures are needed to close it up.

Thinking about the legality of it all

Think about this as a comparison - I think it was in Bangladesh

A block of land was purchased - perfectly legal
A 10 story building was built - nothing wrong with that
A consortium of rag-traders purchased the building - perfectly legal
The rag traders employed 1000 slaves - perfectly legal
The for the duration of the work day the slaves could not leave
Then one day the building caught fire - nothing illegal about that
The slaves could not escape the fire
The building collapsed
1000 slaves died in the fire and subsequent building collapse
All the major western brand clients (temporarily) distanced themselves from any responsibility

new article on CNBC points out new zealand and trusts
New Zealand is among the countries already coming under pressure following Monday's revelations.
"The offshore system is a global worldwide system, and that means New Zealand, Australia, Cook Islands, Costa Rica, Panama and the U.S. are all part of this system in some way or another, they're feeding clients to it and they are attracting clients."
http://www.cnbc.com/2016/05/09/panama-papers-sequel-reveals-details-of-o...

To quote one of the all time greats and one of my personal heroes:

"The world is a dangerous place to live; not because of the people who are evil, but because of the people who don't do anything about it." Albert Einstein

is JK's answer no I did not or no I can not remember or no you cant prove that
Andrew Little: Did he personally push through the zero rating of tax on foreign funds in 2010 over the objection of officials from the Ministry of Economic Development or, put another way, does he recall saying: “I have told Gerry to deliver me a paper that has zero rating of funds”?

Rt Hon JOHN KEY: No.

Trouble is: Google says Yes.
Try Googling "“I have told Gerry to deliver me a paper that has zero rating of funds”?"

Yes there's plenty of evidence there that he personally pushed his ministers into taking the tax rate down on foreign trusts from about 28% to 0%, he was the biggest reason NZ turned into a tax haven, but only in good ole NZ would that be completely ignored by mainstream media, and apparently about 95% of the population, there's no accountability at all here, lies on top of lies.

Enough NZers only care about what is in their wallets that any external damage done to our rep is simply moot. So National have sold our "clean and green" image and are now selling our "honesty and anti-corruption" image for 30 pieces of silver. Yet come election time its likely we'll see JK having a forth term.

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We'll never know. I made a point of catching the first part of question time today and Carter is a disaster. At one point James Shaw had asked a question for which Key was giving a long winded non answer which pivoted onto an personal allegation on MoJo Mathers. After the ensuing fracas Carter then asked Key if he would like to finish his answer to which Key replied "not really" and that was it. Question time is actually now a farce as Ministers know they can avoid the question and pivot to attack the opposition with impunity. If challenged Carter says the question is too loose or he couldn't hear.

These people have lost sight of who they actually serve and whether you agree with the opposition or not they are fulfilling a pivotal roll in our democracy attempting to hold the govt to account. That they are continually denied a level playing field is an indictment.

NZ has descended during keys reign from a reasonably honest democracy to a dodgy little banana republic.
It's interesting that today one of keys good old mates Cameron Slater gets a discharge without any conviction at all, after he hired and paid someone to hack a left wing website! - but gets nothing but a tiny bit of community service.
This is the guy that cried like a little baby after his website was hacked, even though it revealed very seriously unethical behavior from government ministers that were donkey deep in their involvement with his website, using confidential information to attack opposition members and others.
While Hager had his apartment searched for 12 hours, and he didn't even hack anyone, just did what an investigative reporter is meant to do when in receipt of information from a Whistle blower.
It's interesting that even most companies now have things like whistle blower protection programs, realizing the benefits whistle blowers can have in bringing to light bad practice and corruption that can be damaging.

Our government appears to not be that bothered about corruption, and could be mistaken for having a whistle blower persecution program.
It's one rule for keys mates in nz, and a different rule for his opponents obviously.
NZ appears to be going down the toilet fast.

If not technically / legally corrupt, we have certainly become morally corrupt. The country is full of cronyism. It's bloody awful.

ironic that cam slater the great crusader on no name suppression for criminals fought to keep his suppressed as it would create hardship to himself.
he is what is wrong with NZ politics when someone with his lack of class can get the ear of the PM

Yes I'm surprised he can see who is talking with his blue eye patch on, the greens co leader asked some good question and all JK could do was through insults not answers

Yes, Shaw attempts to ask intelligent questions and impressively keeps his decorum despite the banalities hurled back at him. What value are we the taxpayer getting out of this charade?The suggestion of an independent speaker has merit in my view.

I have been saying that NZ should have an independent speaker for years. We don't run rugby games now-a-days with biased local refs, but we think it is ok to run Parliament like that.....

I think this is one of our biggest constitutional issues, up there with the TPPA. More important than the flag, monarchy, republicanism.....

His time's up.

http://www.nzherald.co.nz/world/news/article.cfm?c_id=2&objectid=11636936

In London tomorrow Police Minister Judith Collins will represent the Prime Minister at the London Anti-Corruption Summit.

Brilliant how ironic !!! Couldn't National find anyone but Judith to go ?

They will close the conference room doors, peel off the 'anti' sticker from the sign, and laugh maniacally.

Thanks, this made me laugh out loud

OMG.

haha brilliant

Let us remind ourselves who National have sent to the London Anti Corruption summit. Let us hope its a direct flight there and back with no stop overs.

With so many National candidates to choose from I guess they picked the one with the most first hand experience.

per wiki

In March 2014, Collins was accused of a conflict of interest after an overseas trip where she 'dropped in' and endorsed the milk produced by Oravida – a New Zealand company which exports to China – of which her husband is a director. After being admonished by the Prime Minister, Collins apologised and stated that she and a Chinese executive were 'very close personal friends'.[48][49][50] Over the following weeks the Labour Party continued asking who the Chinese official was. Collins did not provide his name, which House speaker David Carter described as "very unsatisfactory".[51] Prime Minister John Key stated publicly that Judith Collins was on her final warning over this incident.[52]

This morning david Cameron was overheard saying that many of the people coming are from corrupt countries.
maybe that is the point so they can learn and teach others how to get away with it

My lasting memory of this Panama debacle is of journalists from RNZ,TVNZ and Hagar the Horrible hunching over documents allegedly containing news that will shock us and give something the media hope will mean a room full of gongs next year.
Results so far......LESS THAN SPECTACULAR.

It was always going to be, for reasons including those listed here on Sunday night, before the 'revelations' started on Monday (TVNZ/RNZ/Hager) and Tuesday (ICIJ):

http://www.interest.co.nz/opinion/81463/ron-pol-compares-nzs-foreign-trusts-criminal-getaway-car-manufacturing-industry-asks