Saturday, the 11th of November
Last year, a press leak tore the scab off a vast and complex shadow banking system; one set up with the express purpose of allowing individuals and companies to commit fraud and tax evasion. The contents of 11.5 million confidential documents implicated captains of industry, prime ministers and royals alike in the dark arts of shell corporations, legal maneuvering and offshore tax havens.

The documents, hacked from the Panamanian law firm Mossack Fonseca, had been passed to the International Consortium of Investigative Journalists (ICIJ). 107 news organisations across the globe had worked in secret to curate and vet the hoard of information. And at the head of that operation was a feted Munich newspaper, the Süddeutsche Zeitung.

This week the Süddeutsche Zeitung and ICIJ struck again. These are the Paradise Papers.
Trouble in paradise.
It is the largest document dump in history. Some 13.4 million documents that have been scoured by hundreds of journalists working in tandem across the globe. They were prised from the servers of Appleby Group Services, an offshore law firm based in the Caribbean tax haven of Bermuda. Appleby has offices across the idyllic islands, but the space where it does most of its work is in the grey area of aggressive tax minimisation strategies. Appleby's expertise allows individuals and multinational corporations alike to game tax codes, avoid oversight and shift billions of dollars offshore each year.

Why is this trove such a big deal? For starters, there are many recognisable names mentioned in it, including Queen Elizabeth II, Prince Charles, the Duke of Westminster, the billionaire tech investor Yuri Milner, singers Madonna and Justin Timberlake, Formula One champion Lewis Hamilton and about half of Donald Trump's cabinet. The Papers also reveal the aggressive exploitation of regulatory loopholes by several major corporations including Walmart, Disney, Uber, Nike, and Apple.

But while the practices documented in these records may be considered embarrassing they remain, for the most part, legal. And therein lies the rub. So as with the Panama Papers that came before, the Paradise Papers aren't simply an exercise in naming and shaming; the goal is to spur efforts to reduce tax avoidance. This week, for instance, there have been suggestions that tax havens should be blacklisted, something that would probably be far easier said than done. But even if it could be done, a comprehensive European Union blacklist of tax havens would at best only have a reputational impact; that's hardly a powerful deterrent when billions of dollars are at stake.

Offshoring is accelerating the collapse of many developing countries' tax bases. It deprives Germany of a sum that would equal roughly 30% of its total corporate tax revenue, money that should be spent on government services and programs. Across Europe in 2014 it is estimated that some €78b was lost in tax revenue. The UK's Opposition leader Jeremy Corbyn pointedly asked the Queen to apologise and recognise the damage that these practices inflict.

At the heart of the problem is the fact that many governments are complicit in this behaviour. Dutch authorities are now investigating a decision - made without the supervision of tax specialists - to allow US giant Proctor and Gamble to move more than €500m offshore, saving the latter nearly €150m in taxes. The situation is further complicated by the fact that some of those who push the limits of tax minimisation occupy senior government roles themselves. Just days after the document dump British representatives sought to water down EU blacklist efforts. And in the US Commerce Secretary Wilbur Ross uses a labyrinthine tangle of shell companies to disguise his stake in a shipping giant, Navigator Holdings, which has contracts with Russian companies linked to the Kremlin.

It remains to be seen whether these leaks can become the catalyst for genuine regulatory change.
A jobless Priti Patel departs 10 Downing Street.
Secrets and misrepresentations - Back-to-back scandals claimed two of Theresa May's cabinet ministers in the space of a week. The ink had not yet dried on Defence Secretary Michael Fallon's sexual-misconduct-related resignation letter when attention shifted to Priti Patel. Early in the week it was revealed that the international development secretary had broken ministerial conduct by meeting in secret with Israeli politicians and diplomats (including Netanyahu) on 12 separate occasions. All of which occurred without the knowledge, guidance or blessings of the UK's Foreign Office or cabinet.

The perception of Patel's partiality to her hosts became unshakeable particularly after it was alleged that she was planning to divert developmental aid funds to the Israeli Defence Force for a project in the illegally occupied Golan Heights.

Any hopes May had harboured for respite after her bruising week were dashed again on Friday when the legal expert who had written Article 50 of the EU constitution (the Brexit provision) accused her of misrepresenting his work. Lord Kerr said the British government was putting political expediency ahead of the nation's interests and that it could in fact legally and unilaterally stop Brexit at a whim. Given the political capital already spent to get to this point, there is just no easy way out for May's government.

For added effect, EU business councils reiterated their warning that the UK has only a few short weeks to agree to a divorce bill in order to restart negotiations on a two-year transition deal. 
Clearing the deck.
A royal purge - Prior to last weekend Mohammad bin Salman bin Abdulaziz Al Saud was known as the most ambitious member of his family other than the nation-builder Ibn Saud himself. But this week it has become clear that Saudi Arabia's Crown Prince - the man known as MbS - may be operating in a league of his own. In a dramatic purge hundreds of high-ranking businessmen and military figures and 11 princes have been arrested. Riyadh has labelled it an anti-corruption drive. 

This is the culmination of a longstanding plan by King Salman and his favourite son to consolidate control of the Kingdom. Over the past two years, two Crown Princes have been bundled aside to make way for MbS. Both relatives are believed to be under house-arrest, as is Alwaleed bin Talal, one of the world's richest men. Another prince, Mansour bin Muqrin, perished along with much of his retinue when his helicopter crashed in the south of the country. State media reported that he was fleeing the country; naturally there is no shortage of conspiracy theories that his helicopter was shot down.

MbS is diving headlong into his Vision 2030 plan to reduce Saudi Arabia's reliance on fossil fuels, transform the country into a tourism hub, and marginally liberalise the religious and social order. He is also keen to fire up Saudi Arabia's rivalry with Iran. A Houthi missile launched at Riyadh on the night of the purge has been decried as an act of war perpetrated by Tehran. 

To top it all, Lebanon's PM Saad Hariri (a Saudi client) resigned unexpectedly while visiting Riyadh during the week, citing Iranian interference through Hezbollah proxies as his reason for doing so. Some believe that Hariri is now being held against his wishes!

It's an extraordinary state of affairs that just months after the GCC spat the situation in the Gulf has become even more untenable.
What a difference a year makes.
  1. Trump's tone softened in China with a $250b trade deal
  2. Elsewhere in Asia he coaxed and lambasted North Korea
  3. Loyalists celebrated the anniversary of his 2016 victory
  4. As did Democrats who won in Virginia and New Jersey
  5. Another gun massacre claimed 26 lives in Texas
  6. Roy Moore was accused of sex with underage teens
  7. The State Department has thinned out "at dizzying speed"
  8. The US is now the only country not in the Paris Agreement
  9. Republicans plan to push back tax breaks until 2019
  10. Trump tightened Cuba vacation restrictions
Staying true to its name.
Going green - The archipelago nation of Cape Verde sits in the Atlantic, just off the coast of Senegal. Soon it will be known for more than just its beautiful beaches and mountains: the whole country will run on 100% renewable energy by 2025. With a mix of pumped hydro, solar, wind and battery technology this ambitious proposal will soon be a reality. 

Adulthood playtime - Don't poke fun at your colleagues if they turn up with a colouring book. It works. New Zealand researchers have found that regular use of this colourful and simple tool can alleviate the symptoms of anxiety and depression. This is one fad that we will happily endorse and partake in.
A century and counting.
Gender pay gap - A British society has found that the campaign to equalise pay between men and women is going backwards. The slow progress of the previous decade has stalled and is now being reversed amongst some demographics. At this rate, it's believed that the pay gap will take 100 years to be fully eradicated.

Mediterranean sex trade - The human toll of sex-trafficking was laid bare this week when the bodies of 26 girls were bought ashore in Italy. All were Nigerians aged between 14 and 18. It's believed that the boat trafficking them dumped them in duress.
Your weekend long read... Here is a thought-provoking piece from the Financial Times that will upend your idea of just how sustainable 'green' cars are. Get your teeth into it.

Once again, please share this issue of The Wrap with friends and family if you found it interesting.

Thank you.