Live It, Love It, Earn It, Invest It in an Offshore Company
I don’t know if you’ve been following the whole Panama Papers thing, but if you haven’t, here’s a quick summary of what’s going on:
What are the Panama Papers?
11.5 million documents, particularly emails, pdf files, photo files and excerpts, that belong to Mossack Fonseca, an Panamanian law firm. In particular, many of the legal documents relate to the incorporation of “shell companies,” or companies with a legal structure but no actual business.
Okay, so a bunch of rich people are putting money in offshore accounts, shell companies, and so on. Why are the Panama Papers a game-changer?
The documents and data, if the full body is released (which is not guaranteed to happen), could reveal a lot about the structure of the “shadow market” — for the first time, we’d have a relatively complete picture of the flow of money through offshore accounts and see how the wealthy are hiding their money.
That could be interesting, in a sort of vicarious or schadenfreudey way. But there’s one piece of this story that is very Billfold-relevant.
As the Wall Street Journal explains:
The Panama Papers: The Mysterious U.S. Connection
So far, none of the U.S. intermediaries have been named. The only direct U.S. connection involves financial writer and life coach Marianna Olszewski, the author of “Live It, Love It, Earn It: A Woman’s Guide to Financial Freedom.” The BBC reported that Mossack Fonseca employed a 90-year old British man as a stand-in to allow Ms. Olszewski to confidentially access funds she had invested in a secret offshore company.
The ONLY DIRECT U.S. CONNECTION (so far) is a financial coach whose book presents her “classic American Dream” story as one of hard work and thrift:
If I “traded” one dollar of my hard-earned money for a piece of pizza, that money would be gone forever. Was the pleasure of the pizza worth it, or should I save the money for something else? I always asked myself that question before making a purchase, and I still do today.
I guess investing your money in an offshore company to avoid taxes is thrifty, in the technical sense of the term. But now I’m picturing this financial coach asking herself “Is the pleasure of paying $10,000 to allow a 90-year-old man to claim that he is the owner of my offshore accounts so that he (and I) could withdraw funds from those accounts without anybody knowing the accounts belonged to me worth it, or should I save that money for something else?”
Also? Olszewski ends the “My Story” section of Live It, Love It, Earn It with “It took several years, but I did make more money than I ever dreamed of in a very tough business, and at 30 years old I found myself in the top 1 percent of income earners of any age or gender.”
First of all, why be coy about the business? (It’s a hedge fund marketing company.) Second of all: it was never about the pizza. Financial coaches who write “don’t spend a dollar on pizza” with one hand and “oh, I just found myself in the top 1 percent” with the other are telling two different stories, not to mention the third, secret story that I’m sure we’ll learn more about soon.
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