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The term “Panama Papers” is about to become a major part of the global lexicon. That’s because it represents something very big: the largest data leak in human history. The data comes primarily from a Panamanian law firm and forms the basis of what describes itself as “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”. Bigger than both Wikileaks and the Snowden files, the investigation has revealed “a cast of characters who use offshore companies to facilitate bribery, arms deals, tax evasion, financial fraud and drug trafficking”.
Here are 10 important things you need to know about it:
1. It really is very big
The Panama Papers represent more than 2.6TB (terabytes) worth of data and 11-million files in total. It’s pretty scary then that the files come from a single Panamanian law firm called Mossack Fonseca.
2. We don’t know who the leaker is
At this stage it’s still unclear who leaked the “Panama Papers”, but that may well change in the near future. Remember we didn’t know who Edward Snowden or Chelsea Manning were until well after the data they’d leaked had become public knowledge.
That said, the whistleblower was incredibly careful about keeping their identity secret in the run-up to sharing the data with German publication Süddeutsche Zeitung.
3. Releasing the information is a collaborative effort
Led by the International Consortium of Investigative Journalists and the Center for Public Integrity, Panama Papers reporting partners include The Guardian, the BBC, and Süddeutsche Zeitung.
4. This release has been a year in the making
The unnamed whistleblower first contacted Süddeutsche Zeitung more than a year ago. After an initial leak, the number of documents continued to grow, until they reached the size they are today.
5. They’re not just one kind of document
The leak includes email chains, invoices and documents used in the day-to-day running for of Mossack Fonseca. Here’s how the files were structured, according to Süddeutsche Zeitung:
Mossack Fonseca created a folder for each shell firm. Each folder contains e-mails, contracts, transcripts, and scanned documents. In some instances, there are several thousand pages of documentation.
6. There are some big names in bad company
Once the journalistic team got hold of the leaks, they started searching for names they recognised. Alongside 140 politicians from 50 countries including Vladimir Putin, they found relatives of those leaders, as well as public figures, dictators, drug dealers, and Mafia members.
7. The company at the centre of it all is seriously dodgy
Mossack Fonseca isn’t your average law firm. It specialises in creating and selling anonymous shell firms around the world. In the words of Süddeutsche Zeitung, “these shell firms enable their owners to cover up their business dealings, no matter how shady”.
As Süddeutsche Zeitung notes, owning a shell firm isn’t illegal in and of itself. However, it says, “a look through the Panama Papers very quickly reveals that concealing the identities of the true company owners was the primary aim in the vast majority of cases”.
Add in the fact that, for an extra fee, Mossack Fonseca provides a sham director and, if desired, conceals the company’s true shareholder and you have a company playing in some seriously murky waters.
8. There was some clever tech used in the operation
In order to index the data in the Panama Papers, Süddeutsche Zeitung used Nuix, the same program that international investigators work with. Here’s how the German publication describes the process:
Süddeutsche Zeitung and ICIJ uploaded millions of documents onto high-performance computers. They applied optical character recognition (OCR) to transform data into machine-readable and easy to search files. The process turned images – such as scanned IDs and signed contracts – into searchable text. This was an important step: it enabled journalists to comb through as large a portion of the leak as possible using a simple search mask similar to Google.
The journalists compiled lists of important politicians, international criminals, and well-known professional athletes, among others. The digital processing made it possible to then search the leak for the names on these lists. The “party donations scandal” list contained 130 names, and the UN sanctions list more than 600. In just a few minutes, the powerful search algorithm compared the lists with the 11.5 million documents.
9. There was still serious legwork
We’re frequently told that contemporary newsrooms — with their slashed budgets and small teams — mean that the art on investigative journalism is dying. There may be some truth to that, but the Panama Papers show that there is still room for serious journalistic legwork. No matter what technology you have at your disposal, sifting through 11.5-million separate documents is no easy task.
And remember, owning a shell company isn’t in and of itself illegal. The journalists involved therefore had to ask themselves a number of questions for each name they uncovered:
What is this person’s role in the network of companies? Where does the money come from? Where is it going? Is this structure legal?
Then there’s the fact that, in the words of Süddeutsche Zeitung, “the providers of offshore companies – among them banks, lawyers, and investment advisors – often keep their clients’ names secret and use proxies. In turn, the proxies’ tracks then lead to heads of state, important officials, and millionaires”.
In order to get around that, it says, “journalists cooperated with one another to investigate thousands of leads: they examined evidence, studied contracts, and spoke with experts”.
10. There’s a Zuma connection
It comes in the shape of his larger-than-life nephew Clive Khulubuse Zuma, who is implicated in a rotten oil deal which cost the people of the Democratic Republic of Congo more than US$100-billion.