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WHISTLEBLOWING AND THE PANAMA PAPERS: EXPLORING THE CONNECTIONS
Described as potentially the largest whistleblowing document disclosure in history, the release of 11.5 million records in the Panama Papers will inherently force societies globally to make basic choices about the conflict between secrecy and accountability. That is because they expose the secret financial lives of the wealthy and powerful in some 200 countries from all continents and ideologies, including Russian and Chinese leaders. Below are some preliminary conclusions, lessons learned and challenges.
WHY IT MATTERS
The public’s right to know: It is too early to know the extent of illegality that the evidence will prove. But that’s not the point, as Iceland’s angry citizens demonstrated by forcing their Prime Minister’s resignation. Citizens have a right to know when national leaders betray the public’s trust.
Vulnerability to corruption: It is not too early to conclude that this vast, secret world creates vulnerability to covering up massive fraud such as the Swiss banking schemes exposed by whistleblower Bradley Birkenfeld. Initial stories only have scratched the surface for what could potentially be history’s largest evidentiary treasure chest.
The opportunity and test for global accountability institutions: As is typical in all whistleblowing cases, the real test is whether the information is properly acted upon. Whether law enforcement and other accountability institutions take advantage of this unprecedented opportunity from all the evidence in this disclosure will be a test of their legitimacy. The media’s investigative journalists have done their share. Will government?
Threats from an underground economy that shields criminals, terrorists and the power structure: Whistleblowers reveal the facts that allow the public to hold power to account. The most fundamental contribution of this disclosure is exposing a global, trans-ideological secret underground economy. This disclosure alone exposed some 214,000 offshore entities. This secret economy is not only available to cover-up financial fraud, but it can also hide the proceeds of crime, and be used to financed organized criminal or terrorists groups, or virtually any activity unable to withstand scrutiny from the law or the public.
WHAT’S AT STAKE
Time to end the cheap shots against transparency: Transparency has been under attack by powerful interests because it makes life messier for them. Yet transparency is the true test of good governance and democratic accountability. The type of ignorance whistleblowers keep exposing, from widespread fraud to an underground economy of offshore entities, isn’t bliss.
The repressive backlash is certain to get ugly: The first principle of retaliation is that the more significant the threat posed by dissent, the more certain and ugly the reprisal. While whistleblowers are making more of a difference than any time in history, the fact they are suffering so much as individuals for protecting the public interest is increasingly seen as unacceptable.
Solidarity is essential because repression works: Martyrs are the exception, rather than the rule. Edward Snowden’s disclosures sparked passage of the USA Freedom Act to ban mass government surveillance. But he is facing indefinite exile in Russia from the nation whose freedoms he successfully defended from government.
Defending our right to know: We’ll have to if we want the flow of information to continue. Those threatened will stop at nothing to suppress exposure of truths they cannot defend. Retaliation will intensify against all whistleblowers, including those who work through institutional channels rather than anonymous media leaks.
WHAT NEEDS TO BE DONE
The first step: extend whistleblower rights to where they’re needed most: The first step is a legal right for whistleblowers to defend themselves against any retaliation by those whose abuses of power they expose. In 2013, a global coalition adopted the Tshwane Principles to resolve the conflict between national security and the right to information. A primary recommendation was a public interest defense against criminal and civil liability for whistleblowing. That principle should be extended to all freedom of expression.
Pioneering U.S. whistleblower laws are AWOL when needed most: 13 other nations have a whistleblower defense against civil and criminal liability, from Australia and New Zealand to Ghana and Malaysia. U.S. whistleblower laws only ban employment retaliation. Anything else is open season, with no rights against the ugliest reprisals like prosecution or multi-million dollar slap suits.
Mandate to strengthen international financial transparency laws: The Organization for Economic Cooperation and Development has proposed an international commitment for tougher financial disclosure requirements. The United States should stop opposing this reform, which is a no brainer for all except those who have something to hide.
THE BOTTOM LINE
For those enforcing the rule of law, the Panama Papers will force the answer to every society’s most basic questions about each government’s real agenda. It should also be remembered that more than any other time in history, whistleblowers are creating extraordinary opportunities for accountability and reforms. We have arrived at a moment of truth for the role of transparency in society. When the wealthy and powerful evade the rule of law routinely and with impunity, do governments want to know? And will they act? The jury is out.