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Millions of leaked files shine light on where the elite hide their money

It is called the Paradise Papers: the latest in a series of leaks made public by the International Consortium of Investigative Journalists shedding light on the trillions of dollars that move through offshore tax havens.

The core of the leak, totaling more than 13.4 million documents, focuses on the Bermudan law firm Appleby, which caters to blue chip corporations and very wealthy people. Appleby helps clients reduce their tax burden; obscure their ownership of assets like companies, private aircraft, real estate and yachts; and set up huge offshore trusts that in some cases hold billions of dollars.

Like with the Panama Papers, the Paradise Papers leak came through a duo of reporters at the German newspaper Suddeutsche Zeitung and was then shared with ICIJ, a Washington-based group that won the Pulitzer Prize for reporting on the millions of records of a Panamanian law firm. The release of that trove of documents led to the resignation of one prime minister last year and to the unmasking of the wealth of people close to President Vladimir Putin of Russia.

Americans — companies and people — dominate the list of Appleby's clients. Past disclosures, such as the 2013 "Offshore Leaks" from two offshore incorporators in Singapore and the British Virgin Islands, the 2015 "Swiss Leaks" from a private Swiss bank owned by the British bank HSBC and another leak in 2016 from the Bahamas were dominated by clients not from the United States.

The documents come not only from Appleby, but also from the Singaporean company Asiaciti Trust and official business registries in places such as Bermuda, the Cayman Islands, Lebanon and Malta.

Among the more prominent names contained in the newly leaked papers is Britain's Queen Elizabeth II, whose investment managers placed roughly $13 million in offshore portfolios in the Cayman Islands and Bermuda.

The investments were made by the Duchy of Lancaster, which handles the queen's finances. There is no suggestion the investments are illegal.

Setting up companies offshore is generally legal, and corporations routinely do so to facilitate cross-border transactions such as mergers and acquisitions. Appleby, in a public statement on Oct. 24, after inquiries from ICIJ, said that it was "subject to frequent regulatory checks" in "highly regulated jurisdictions."

"Appleby has thoroughly and vigorously investigated the allegations and we are satisfied that there is no evidence of any wrongdoing" the company said.

But with this latest leak, some wealthy individuals and multinational corporations may think twice about using offshore ownership structures, said Jack Blum, a lawyer who worked for decades on congressional committees investigating money transfers overseas.

"The danger of being found out has increased exponentially," Blum said.

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