William Roper: So, now you give the Devil the benefit of law!
Sir Thomas More: Yes! What would you do? Cut a great road through the law to get after the Devil?
William Roper: Yes, I’d cut down every law in England to do that!
Sir Thomas More: Oh? And when the last law was down, and the Devil turned ’round on you, where would you hide, Roper, the laws all being flat? This country is planted thick with laws, from coast to coast, Man’s laws, not God’s! And if you cut them down, and you’re just the man to do it, do you really think you could stand upright in the winds that would blow then? Yes, I’d give the Devil benefit of law, for my own safety’s sake!
– Sir Thomas More from “A Man for All Seasons”
By Catherine Austin Fitts
I discussed the Panama Papers at length in this week’s Money & Market audio – I will not repeat here. Rather, I want to emphasize one overarching point.
An unknown criminal describing themselves as “John Doe” broke into the digital systems of a private law firm, stole a great deal of their data and then transferred these stolen goods to a news outlet. The news outlet felt entitled to not only receive and keep the stolen items but to then share them broadly with other news outlets and journalists throughout the world. They are now proceeding to use the stolen items to get headlines and enhance their private business and reputation.
The idea, somehow, is because the law firm served rich people that they and their clients have no rights to privacy and confidentiality regarding data about their business and finances. Indeed, if some of them engaged in illegal or unethical activities, all clients of the law firm should have no right to privacy and confidentiality.
Let’s pretend for a second that instead of stealing databases, “John Doe” had broken into a depository and stolen gold, silver and cash belonging to a series of private people and companies, transferred it to a group of news services who then shared it with other services, and announced that even though it was stolen, they had the right to use it to enhance and enrich their sales and reputation.
Moreover, such a “citizens seizure” and selective disclosure of others people’s goods was possible before any of the victims had a right to address any allegations of wrongdoing in a court of law. Honest players and productive businesses will be harmed or destroyed as a result. That fact will be lost in the rush to condemn the offshore system in a manner that will serve the very people who created and grew the offshore system.
It will also help generate lots more business for the largest tax haven in the world – The United States.
After years of lambasting other countries for helping rich Americans hide their money offshore, the U.S. is emerging as a leading tax and secrecy haven for rich foreigners. By resisting new global disclosure standards, the U.S. is creating a hot new market, becoming the go-to place to stash foreign wealth. Everyone from London lawyers to Swiss trust companies is getting in on the act, helping the world’s rich move accounts from places like the Bahamas and the British Virgin Islands to Nevada, Wyoming, and South Dakota.
“How ironic—no, how perverse—that the USA, which has been so sanctimonious in its condemnation of Swiss banks, has become the banking secrecy jurisdiction du jour,” wrote Peter A. Cotorceanu, a lawyer at Anaford AG, a Zurich law firm, in a recent legal journal. “That ‘giant sucking sound’ you hear? It is the sound of money rushing to the USA.” ~ Jesse Drucker, The World’s Favorite New Tax Haven is the United States, Bloomberg
John Doe is not a whistleblower. He is a criminal. He stole and transferred private property. And he is now at liberty to blackmail thousands of other people concerned about privacy (for perfectly legal or illegal reasons) not to mention terrorizing law firms globally to do his bidding – which I highly doubt is “whistleblowing.”
The more the media outlets are able to make this out to be a juicy and entertaining story, the more John Doe and his colleagues can terrorize for power and profit. They can dictate who wins the Presidential campaign. They can dictate who gets what deals. They can shift trillions from the offshore havens to Nevada, Wyoming and South Dakota. The possibilities are endless. Their cybersecurity startups will make a fortune offering to “protect us” from this new, ever present danger. When the companies are plump enough, they will IPO their stock into our pension funds and retirement accounts.
We have now created a popular meme that lawlessness in the digital space is quite all right – indeed it is even fashionable. It is fine and dandy if social media firms engage in “surveillance capitalism.” It is fine if entrainment technology determines market outcomes and elections. It is ok if hackers steal and blackmail under the guise of calling themselves “whistleblowers.”
If it is ok to hack into a Panama law firm and steal their data and then transmit stolen goods and then use those stolen goods to enhance the business and personal interests of the people who have stolen those goods and the media that pays the game with them, then there is no law. There is racketeering on the grand scale.
What can be done to one, can be done to all.
Before you support these shenanigans, please understand the precedent that you are setting. You are supporting the notion that the law is whatever the people who are good at cyberwarfare say it is or whatever the people who promote the best smears imply.
The rule of the mob. Run by the most powerful players in the world. Who want to make sure you put your money where it works for them. Or else.
Without privacy, there is no freedom. Before you think it fashionable to illegally invade another man’s privacy, you need to understand the ramifications to your freedoms and future and exactly who and what you are really supporting.
Not to mention the implications to market liquidity. And why is the Fed meeting behind closed doors today before Chairman Yellen meets with President Obama?