While most companies are created and operated for legitimate economic activity, there is a small percentage that aren’t. Entities involved in corruption, money laundering, fraud and tax evasion frequently use such companies as vehicles for their criminal activity. “The Idiot’s Guide to Money Laundering from Global Witness” shows how easy it is to use layer after layer of shell companies to hide the identity of the person who controls and benefits from the activities of the network. The World Bank’s “Puppet Masters” report found that over 70% of grand corruption cases, in fact, involved the use of offshore vehicles.
For years, OpenCorporates has advocated for company information to be in the public domain as open data, so it is usable and comparable. It was the public reaction to Panama Papers, however, that made it clear that due diligence requires global data sets and beneficial registries are key for integrity and progress.