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How Low Can You Go?

The role of corruption in the lives of the ultra-rich

Seven years ago, during the heart of the last global financial crisis, I wrote a book called Conspiracy of the Rich. The book was an examination of the events that led up to the Great Recession and an exposé on the ultra-rich who manipulated the global markets to gain great wealth while devastating world markets and wiping out much of the retirement savings of the middle class.

At the time when I wrote the book, many people dismissed it as a conspiracy theory—the ramblings of a known financial provocateur. I admit that I’ve always been a contrarian when it comes to money. But I’ve never been one for its own sake. Rather, I’ve always shared what I truly believe about the world of money.

To me, it was maddening and appalling that the world’s richest bankers, traders, and politicians got away with so much. And it was a tragedy that so many lives were ruined in the process. That is why I wrote Conspiracy of the Rich, to help people avoid being victims of such corruption again by helping them see the world as it really is.

As of this last weekend, those who railed against the book seven years ago might be singing a different tune today.

Why? Because of the Panama Papers.

What are the Panama Papers?

According to The International Consortium of Investigative Journalists:

The Panama Papers is a global investigation into the sprawling, secretive industry of offshore that the world’s rich and powerful use to hide assets and skirt rules by setting up front companies in far-flung jurisdictions.

Based on a trove of more than 11 million leaked files, the investigation exposes a cast of characters who use offshore companies to facilitate bribery, arms deals, tax evasion, financial fraud and drug trafficking.

This is the biggest leak of confidential papers in the history of the world, with over 2.6 terabytes of information on the secretive dealings of many ultra-rich with ties to governments and shell companies around the world.

At the center of the Panama Papers is a law firm called Mossack Fonesca, which is reported to have helped the ultra-rich hide money in these offshore companies in order to avoid taxes and grease wheels.

As Vox reports :

As you would imagine, there is quite a lot in the 2.6 terabytes. Here are a few of the highlights that the team found, with links to the full stories where you can read the details:

- Vladimir Putin's inner circle appears to control about $2 billion worth of offshore assets.

- The Prime Minister of Iceland secretly owned the debt of failed Icelandic banks while he was involved in political negotiations over their fate.

- The family of Pakistan's prime minister owns millions of dollars worth of real estate via offshore accounts.

- Ukrainian President Petro Poroshenko pledged to sell his Ukrainian business interests during his campaign, but appears instead to have transferred them to an offshore company he controls.

Why does this matter?

That the ultra-rich use tax havens to shield themselves is not really news. Indeed, as most news agencies point out, owning an offshore company in and of itself isn’t even illegal. But the Panama Papers are the first massive look into how far reaching this practice is, the abuses of the rules, and that it happens at the highest levels of our governments and corporations.

And the amount of money is massive—to the tune of $7.6 trillion, according to Vox.

For the first time, the world is waking up to what I preached in Conspiracy of the Rich. The game of money is rigged, and living by the old rules of money—go to a good school, get a good job, buy a house, save money, and invest in a diversified portfolio of stocks bonds and mutual funds, is no longer an option for succeeding in today’s financial world.

Everything is manipulated

I haven’t personally reviewed the documents in the Panama Papers—there are millions of them—but a team of more than 370 journalists from 76 countries have . And you can be sure more stories of corruption and rule bending will break from this leak.

More than anything, this should open your eyes to the fact that all markets are manipulated by the ultra-rich and powerful politicians. It’s always happened, and it always will. Because of this, you must continually be educated on what is happening in the financial markets. In a world of increasing financial corruption, it’s imperative to continually increase your financial IQ.

For some, the Panama Papers will be a wake up call. The wise ones understand that they must take control of their financial future, and not rely on corrupt governments and leaders to do it for them. Unfortunately, not everyone will do this. Many will ignore the news or resign themselves to the fact that there is nothing they can do.

The question is, which one will you be? Today is the day to start owning your financial future.