Pandora Papers reveal what South Floridians already knew

The offshore financial subterfuge and covert real estate deals revealed last week in the Pandora Papers were the stuff of international shock and outrage.

Except in South Florida. We already knew. A consortium of 600 journalists spent two years sifting through 11.9 million leaked files that document how the tax-averse ultrawealthy hide their assets. The Pandora Papers showed how offshore banks create faux shell companies that exist solely to conceal identities of clients as they merrily scarf up luxury condos, seaside mansions, yachts, private jets and museum-quality artwork.

Indeed, the International Consortium of Investigative Journalists opened a Pandora’s box filled with the unseemly doings of billionaire tax-dodgers, third-world kleptocrats looking to hide their loot and criminal kingpins in need of an anonymous place to launder their dirty money. All out of sight of tax collectors, government investigators, political opponents, the public, the media and maybe an ex-wife or two.

The investigation unmasked the stratagems offshore bankers used to conceal the transactions of 130 billionaires and an international array of government ministers, judges, mayors, generals, entertainers, sports stars, a disgraced religious order and a onetime mistress of Russian President Vladimir Putin. The media consortium counted 35 world leaders with hidden assets, including “current and former presidents, prime ministers, and heads of state.” Suddenly, their covert dealings were reported by 150 media outlets in 117 countries.

For instance, King Abdullah II was exposed as the principal behind 36 shell corporations that shrouded extravagant purchases apt to offend his less fortunate subjects in Jordan, such as 14 luxury homes in the U.S., including three beachfront Malibu mansions. Apparently, even kings need a getaway.

South Floridians might not have known the particulars unearthed in the Pandora Papers but we already knew the game. We’ve been peddling high-end real estate and super yachts to phantom buyers since the cocaine cowboys era four decades ago.

These latest revelations made for a hell of an international scandal, but in South Florida, we only feign outrage, then change the subject (“Yeah, but how’s about them Dolphins?”) before someone mentions that those same Pandora Papers show that down this way, we’re making out like bandits.

Suddenly, it’s pretty obvious why Broward and Miami-Dade register so many cash sales for houses and condos. According to the Miami-Dade Association of Realtors, Broward and Miami-Dade exceeded the national average for cash sales in August by, respectively, 73.2% and 76.8 percent. In August, 51.4 percent of Broward condo sales and 47.6 percent of Miami-Dade were consummated with cash.

It’s because we’re a dandy, fun, sunny destination with lots of rich-person amenities for billionaires in need of a safe place to park their cash.

Sure, hundreds of millions of dollars invested in our gleaming new condo towers and gaudy waterfront mansions may have been filched from economically forlorn nations in the Caribbean, Latin America, Africa and the old Soviet bloc, but this is what we do. We cater to international jet-setters. We suck up to the rich. We don’t ask a lot of nettlesome questions.

Money of mysterious provenance has helped transform the skylines of Fort Lauderdale and Miami. And helped replace luxurious waterfront mansions with bigger and even more luxurious waterfront mansions, often with anonymous owners who only occasionally visit their South Florida digs.

Civic activists complain that new high-rise condo projects exacerbate South Florida’s traffic and infrastructure woes. But that’s only true if individual buyers are actual people rather than offshore corporations with maildrops in the British Virgin Islands or Panama or the Cayman Islands. Phantom buyers, more interested in sheltering money than sheltering people, don’t demand public services.

The Washington Post estimated that between $5 trillion to $8 trillion has been hidden in offshore tax havens. Hefty chunks of that money is routed into real estate in South Florida and other places favored by those in what would be the upper tax brackets — that is, if they actually paid taxes.

In 2016, after the International Consortium of Investigative Journalists discovered similarly blatant offshore banking abuses in what was dubbed the Panama Papers, the U.S. Treasury Department started flagging all-cash real estate purchases of $1 million or more in Broward, Miami-Dade and Palm Beach counties. The feds warned that “a significant portion of covered transactions have indicated possible criminal activity associated with the individuals reported to be the beneficial owners behind shell company purchasers.”

The Panama Papers scandal was supposed to curtail the sale of sumptuous real estate to incognito entities with dark money and expensive tastes. But the Pandora Papers say otherwise.