Law firm’s Isle of Man offices hit in vast cyber attack
Appleby reveals details of offshore havens targeted in hackers’ theft of files on finances of the super-rich
THE cyber attack on one of the world’s biggest offshore law firms also targeted offices in the Isle of Man, it has been revealed.
Appleby has admitted its offices in six of the world’s biggest offshore jurisdictions were hit by the hackers.
Details of the finances of the superrich were stolen from Bermuda, the British Virgin Islands, Cayman, Hong Kong, Mauritius and the Isle of Man. Experts said that among these offices were jurisdictions held up as the most transparent in the offshore world and ones that observed strict regulation.
The confidential files, expected to be released by the International Consortium of Investigative Journalists this weekend, will be the first test of that since scrutiny on the sector was increased.
The presence of the Isle of Man on the list is likely to cause concern for the Government, which has in the past made clear its dislike of tax evasion, which is illegal, but even of schemes designed to avoid tax legally.
An Appleby spokesman said: “All the relevant authorities have been informed in each jurisdiction.”
The company describes itself as a “global organisation” and says that while it acts in 10 countries, it does not have a headquarters.
One of the allegations said to have emerged from the papers claims individuals dodged taxes by importing aircraft into the EU via the Isle of Man.
Howard Quayle, the Isle of Man’s Chief Minister, said that they had investigated the claims and had found no evidence of any wrongdoing, but nonetheless HM Revenue and Customs had been called in to look at the practice.
He insisted that the Isle of Man had “nothing to hide”.
Ronen Palan, Professor of International Political Economy at City University, who gave evidence to the European Parliament on tax avoidance in the wake of the leaking of the Panama papers, said: “We all knew that Panama was one of the dirty ones, so it was not a surprise, and therefore very few Americans or British people got caught up in it.”
But he added: “Now in this latest hack we understand that we are going to get information about trusts and the ‘clean’ tax havens we may discover that are not so clean, as I suspect that they are not.”
If that were the case, he said the Government might have to face some serious questions, as one of the territories involved was “part of the British State.”
He added that trusts were often seen as the main vehicle for tax evasion and one of the last elements of the offshore world that “maintains secrecy”.
Professor Palan said that of the list, Mauritius and the British Virgin Islands were the jurisdictions seen as having the least transparency and regulation.
Each of the different jurisdictions offers niche services. For example, Cayman specialises in financial instruments, such as hedge funds, whereas Bermuda is known for its insurance industry.
He said that the latest computer hack could force some of the practices within the offshore sector to change their methods.
“People are beginning to be aware that there will be another and another. It will potentially have a huge impact – we will just have to see what is in the papers,” Professor Palan continued.
Appleby said in a statement: “Journalists claim to have seen documents from multiple sources, including Appleby.
“During the cyber-attack, we believe, but we do not know for certain, that a limited number of private documents were stolen by criminals from servers in a number of our offices.
“Whilst we have taken robust measures to protect ourselves from further attacks, we believe that these illegally held documents will be used by journalists who will be publishing stories about the offshore world in the next few days.
It added: “We will continue to defend ourselves and our legitimate and lawful business against these groundless allegations.”