PA News 19/04/2016

When it comes to global wealth inequality, we know how bad it’s getting, but what do we know about who is responsible? When Oxfam reports that 1% of the world population owns more than the other 99% put together, the question arises: who or what is making the rich so much richer, and the poor so much poorer? It turns out we know surprisingly little about the key actors behind this momentous change. This creates a problem for policy makers who want to stop or reverse the growth of wealth inequality. The trend cannot be arrested without understanding its sources. The research I’ve conducted over the past eight years suggests that some of the most important players have been overlooked: wealth managers. They are an elite group of lawyers, accountants, bankers and others who protect the fortunes of their high-net-worth clients from tax authorities and creditors, among others. To achieve these ends, wealth managers design complex, often multi-national structures composed of trusts, foundations and offshore corporations—the building blocks of tax avoidance, and law avoidance more generally. There are at least 20 000 wealth managers spread across 95 countries, and their control of billions in private capital flows plays a […]

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