Did Panama Papers Really Surprise World Leaders?

Politicians reacted with mixtures of shock and disdain to their inclusion in the now-famous Panama Papers. Why? They had to have known the revelations were coming.

No Accidents

First, they didn’t accidentally hire Mossack Fonseca to establish offshore entities for their wealth. Their names showed up in the files because they chose to pursue particular asset protection and privacy strategies that are, by definition, unusual.

They also chose not to make their use of these strategies public. When a person decides to keep certain information secret, they are aware it could leak. Public figures know that everyone from political enemies to the paparazzi will try to expose their secrets.

After the Snowden leaks, the Sony hacking, and assorted celebrity sex tapes, anyone who assumes in 2016 that their secrets would stay secret is stupid. And since stupid people rarely become prime ministers and presidents, it stands to reason the Panama Papers didn’t surprise them.

Asked for Comment

A second reason they were not surprised is that the journalists investigating the leaks asked the named figures for comment days or weeks prior to the April 3 publication. Vladimir Putin’s Kremlin staff said so at the time.

From Observer, 3/31/2016:

On Monday [3/28], Vladimir Putin’s Press Secretary, Dmitry Peskov, warned the Russian public that coordinated media attacks to slander his boss were on the way.
“Another sensationalist box-stuffing with claims of ‘objectivity’ is being prepared for the coming days,” Mr. Peskov announced. “We have received some very unkind requests that were prepared in an interrogation-type manner from an organization calling itself the International Consortium of Investigative Journalists — consisting of journalists from various media outlets, but also other organizations and [intelligence] services. In the coming days, they will publish their opuses in Germany, the USA, the United Kingdom, France, Switzerland, Russia and several other countries.”

It is fair to assume that ICIJ and others in the consortium likewise requested reaction from UK Prime Minister David Cameron, Argentine President Mauricio Macri, Iceland’s Prime Minister Sigmundur Davíð Gunnlaugsson, Ukrainian President Petro Poroshenko, Saudi Arabian King Salman and the others. All were aware some kind of damaging news was coming, even if they didn’t know the details.

Keep in mind, also, that we have only seen the first few of what promise to be many revelations. Other figures not yet named have likely received requests for comment. They are right now modifying their words and actions because they know they will soon be swept up in the story.

Intelligence Failure?

A third reason world leaders should not have been surprised is that their intelligence agencies should have warned them. The investigation was a huge undertaking involving hundreds of journalists around the world for months on end. Imagine the amount of e-mail traffic and phone calls, much of it filled with the kind of names and keywords that NSA and GCHQ routinely scan. They — and equivalent agencies in Russia and China —must have known the investigation was underway months ago.

Look at it another way: the Panama Papers leaks have already brought down one leader and threaten others. They could profoundly affect the stability of numerous governments. If our expensive, intrusive electronic eavesdropping agencies didn’t see this coming, we have a massive intelligence failure and some agency heads ought to lose their jobs.

More likely, the spies did notice and at least some world leaders knew the Panama Papers story was in development months ago. Obama, Putin and Chinese President Xi Jinping were not surprised at all. Nor will they be surprised when the next round of stories comes out.

Remember this when you read the news. The news isn’t news to everyone.