“Wealthy people have always tried to keep their money out of the hands of government.” - Bullough's book is a fascinating account of the myriad ways that rich people attempt to do this. It is a trip through the world of tax havens, shell companies, and other tricksy financial shenanigans.

Serves as an interesting complement (and breezier read) to Jane Meyer's "Dark Money".
Well-written, and engaging, this is definitely recommended.

This is an easy book to describe but unbelievably difficult to detail. Moneyland is that place(s) where the rich have been hiding their money from their home countries so as to protect it from taxes. We think of these places as tax shelters, but what they really are is an unseen organization that exist in many places (some of them virtual) to help the Kleptocrats (think of Russian Oligarchs and African Strongmen) clean up their ill gotten gains and be able to become respectable.

No longer happy with just hiding their money away, other money managers looked for ways to hid the stolen money in plain sight. What could be more reasonable than to buy property in a reasonably safe country that you could retire to in later life or if things got too hot at home. Bullough states that much of the expensive real estate in the City of London, and New York City is owned by trusts that hide the origin of the money used for purchase but also ownership.

By using multiple trusts and holding companies, it gets to the point of almost altediluvian in trying to find the way through the multiple trusts that are made in different countries and jurisdictions so as to be impossible to trace. Just to muddle the waters even more, trusts are created that hold only a minor part of a property and therefore can't be considered the primary owner.

The book is a real eye opener, especially, when it gets to the mini-states who sell passports to the rich and then (for a reasonable donation) give them 'government' jobs, that protect the owners under 'diplomatic immunity'. It's a really interesting read.

In Moneyland: Why Thieves And Crooks Now Rule The World And How To Take It Back, Oliver Bullough sets out to illuminate the means and methods First World tax dodgers and Third World kleptocrats use to hide their businesses and wealth from the rest of us.

Moneyland is a place, he argues, where those with assets can buy passports wherever they like, and apply the laws where they are most advantageous to their businesses, a virtual space with “American privacy, Panamanian shell companies, Jersey trusts, Liechtenstein foundations.” The wealthy can jurisdiction-shop for any country that meets their needs at the moment - and if a country changes the laws, the Moneylanders, as he calls them, can simply move their money to a country with better laws or persuade a country to change theirs. Beyond that, this global infrastructure allows Moneylanders to be shielded from journalists and prevents stolen wealth from being recovered by those to whom the wealth belonged.

Small countries with not a lot of comparative advantages within a global capitalist system have found their market niche by facilitating business anonymity; think Jersey, Monaco, the Bahamas, Nevis, and the Original Moneyland, Switzerland. Bullough makes a fantastic example out of Nevis, an island of 11,000 people in the Caribbean where American lawyers crafted an entire set of banking and privacy legislation initially based on Delaware law to register and protect businesses and hide their assets. Some examples of Nevis connected shady-doings include a hiding place for Viktor Yanukovich, the former president of Ukraine (for whom Paul Manafort worked); a corruption scandal involving the former president of Taiwan; money stolen from Russia by corrupt policemen; members of the ruling family of Azerbaijan, whose gold mining companies and mobile phone companies were registered in Nevis; Britain’s biggest ever tax fraud, an operation run through Nevis; the British trader who caused the “Flash Crash” of the stock market in 2010; and people in the US convicted of securities fraud, day trading scams, and pay day lending schemes. It has also been the location where a number of high-net-worth men have obscured their assets to prevent their soon-to-be-ex-wives from getting their hands on any money in divorce settlements.

The unholy alliance between the wealthy who don’t want to pay taxes in advanced countries and those who rob their governments clean in developing countries poses a serious threat to societies everywhere. As Bullough notes, an estimated 20 billion to 1 trillion dollars per year is stolen in developing countries is stashed away in Moneyland, rendering developing country governments unable to provide basic services and raise general living standards - leaving poor countries poorer despite any revenues they may accrue. In developed countries a declining tax base means deteriorating infrastructure and underfunded public services in education, health, and elsewhere. The result, he writes is “that whole countries are unable to tax their wealthiest residents, meaning that only those least able to afford it are forced to support the government” - and angry populists are on the rise.

Moneyland is a problem that stems from a broken global system, where capital is free to flow between borders with no regulation while people are not. But it is not a conspiracy, Bullough insists, which is what makes it all the more nefarious and difficult to crush. It is instead the work of “well-paid, imaginative and highly-intelligent people” responding in a predictable way to the global conditions that allow money and citizenship to be shopped around in this way. As he writes, “if you squash one ant, or arrest one crooked lawyer, the activities of the rest will continue unaffected. It is the whole system that must be changed, and this is hard.“

This book is great for all of the examples of the truly outrageous criminal activity obscured by the offshoring money and hiding of wealth. But it also makes a strong case for the less criminal but still-very-damaging effects of a shadow system operating for the benefit of the rich and at the expense of us all.

The world is far more corrupt than anyone imagines. The ruling classes feel entitled to steal tax money at will, stash it in overseas accounts, and spend it like it was legitimate through shell companies and trusts. The “country” that enables this is one Oliver Bullough calls Moneyland. It has no borders, no government, and no taxes, but gets it power and support from all of those. Its citizens are welcomed worldwide, no questions asked. The richer they are, the wider the doors swing open.

It used to be that local officials were limited in their greed, because there was only so much they could spend locally. But thanks to globalization and the internet, they can buy condos and buildings, yachts and whole companies right from their laptops, and no one will know. Bullough says “It’s the financial equivalent of never feeling full, no matter how much you eat.” The result is a hollowing out of major cities all over the world, as “corporate” buyers snap up apartments and townhouses, which remain empty. They are simply laundering money for some unnamed “investor”. Meanwhile, their real countries are impoverished as money disappears from them.

They create companies by the boatload. Tens of thousands are created and have their head offices in a townhouse on Harley Street in London, for example. They are sold on the internet for $250-$1000 apiece. Attached to a bank account, they can receive bribes and kickbacks, and purchase condos and yachts. The companies are owned by other companies, which are owned by other companies. Eventually, a real person is named, with no apparent connection to the real owner. (Vladimir Putin’s shell company is in the name of a cellist who was a friend and neighbor of his growing up. It reportedly has a billion dollars in it. Not bad for a cellist.)

The poster child Bullough explores is Ukraine, where “Corruption had so hollowed out the state that it had all but ceased to exist except as means of illegal enrichment.” From the president on down, everyone seems to be on the take, having budgets diverted to their own accounts, or getting kickbacks direct deposited when they pay outrageous prices for equipment or services. Hospitals have no supplies because management has diverted all funds. Doctors get paid $200 a month and must beg patients for money, even though healthcare is guaranteed free. The police are not there to serve and protect, but to be avoided. The courts toe the line of the ruling class. If a company won’t pay bribes, it will find itself unable to operate, and suing will not help.

This is the way of the world, where all the aid money from foreign sources disappears before it reaches anyone in need. Politicians sport $300,000 watches while most of the population has no access to clean water. Their countries are money machines for the ruling classes, and no one else matters. Bullough quotes US Marine Corps General John Allen on his time in Afghanistan: “They (Taliban) are an annoyance compared to the scope and magnitude of corruption with which you must contend.”

It is so entrenched that Bullough cites a local Ukrainian politician: “The choice isn’t between taking a bribe and being honest: it’s between taking a bribe or your children being killed. Of course, you take the bribe.” It consumes even the most naïve and fair. The result is 52% of Russian wealth is held offshore, 57% of Gulf wealth and 30% of African wealth. That doesn’t leave much for the 99%. Or the country.

While the internet has enabled the thieves to open accounts, companies and trusts, countries have enabled them to protect themselves by selling them passports. St. Lucia in the Caribbean alone has issued nearly 13,000. The US sells green cards to anyone willing to invest at least $400,000 in a house or condo. It has issued tens of thousands of these cards.

A new fashion has been added to the sale of passports. Now, thieves can also purchase diplomatic immunity through any kind of ambassadorship. It could be to a country, or just a committee of the UN. It’s a get out of jail free card that dreams are made of.

As corrupt as so many countries are, it seems to pale beside the western countries like the USA and the UK, which provide endless pools of lawyers, bankers and advisors to enable the corruption. Citibank comes up repeatedly as glorying in the fat fees it obtains for laundering millions for corrupt African politicians. If you need your stash structured and hidden, if you need to attack an enemy or defend yourself against government calls for information, it’s the USA that will rush to your side. States like Nevada and Delaware are famous in the rest of the world for their Swiss-like protection of fraudulently-obtained wealth. The hypocrisy of the US whining about tax havens while providing the biggest haven of all is just too clear. While it fines Swiss bank UBS, it lauds the American financial sector on its impressive growth, laundering stolen money by the billions.

One thing missing from Moneyland is the attitudes of the corrupt. Because the revenue stream is endless, money means absolutely nothing to them. Overpaying for cars, parties, or wedding gowns is all trivial. Tipping with hundred dollar bills too. The money is so plentiful it actually has no meaning in their world.

What makes Moneyland so strong is that Bullough has done all his own, original research, onsite. He digs, pesters and perseveres. If a lead goes nowhere, he finds a different angle, on his own. Not once, for example, does he refer to the Panama Papers, which exposed the phony corporate shell business two years ago. The scandal is so deep, he has been able to fill yet another hard-hitting book with its virus.

David Wineberg