Pandora papers: Offshore banking is not illegal but why offshore?

By ZAIDI ISHAM ISMAIL
editor@dagangnews.com

KUALA LUMPUR Oct 8 - For the past few days, the whole world got an eyeful on the wealth and assets of the rich and famous.

These include money purportedly owned by leaders, politicians and corporate captains from the US, Europe and even Malaysia.

The expose was called the Pandora papers after the Greek word "chests of treasure" troves which is buried somewhere away from the prying eyes of the average people.

The Pandora papers were revealed for the world to see on the hidden wealth of the rich.

The expose was supposedly carried out by a multitude of investigative journalists from some of the world's top media organisations.

In the papers, several prominent Malaysians were inextricably linked with the papers.

The papers gave away information that some rich Malaysian have stashed away massive amounts of cash and other wealth in foreign offshore accounts.

These include in the British Virgin Islands and the Cayman Islands which are known for their strict fiscal policies.

Meaning - open an account with offshore finance companies and no court in the world can compel it to disclose information of the account holder.

What are the main reasons of these tycoons for doing so?

Why can't they keep their money in local banks?

Obviously, Malaysia's richest do so to avoid government tax and to amass wealth without other people knowing.

Some of the monies are derived through ill-gotten gains such as money laundering.

This confirms what economists suspected all along: the rich keep their money in bank contributing a paltry amount to the domestic economy.

It is the normal folk who spends and stimulate the economy.

This give rise to another question, why do they resort to such measures?

Why can't they accumulate their wealth in the country and build the domestic economy?

Datuk Seri Anwar Ibrahim has already called for the matter to be debated in Parliament.

This is to discuss the implications for the national economy as the rich are able to repatriate their wealth overseas and escape scrutiny.

In a letter to the New Straits Times, MAPIM president Azmi Abdul Hamid said the money taken out of the country worth trillions of ringgit cannot be ignored. 

"Transparency should be the priority principle if there is an attempt to evade taxes or there is an element of money laundering.

If the money is found to be transferred through illegal means, then action must be taken," said Azmi.

While it is possible to invest and keep money abroad by using another name is not wrong but the accumulated wealth evading from government tax where the individual originates, is not justified.

The Pandora Papers apparently exposed the country to the issue of transparency and integrity of the rich who take out money and keep wealth abroad.

Building and strengthening the domestic economy must be a priority and the outflow of money from the country must be controlled.

Azmi said it aptly: Why should they be secretive in amassing wealth abroad? –  DagangNews.com