A new study reveals how political conditions in the home countries of ultra-wealthy elites may influence their strategies for concealing their finances offshore. Ho-Chun Herbert Chang, Brooke Harrington and Daniel Rockmore from Dartmouth College, U.S., present these findings in the open-access journal PLOS One on July 16, 2025 .
Offshore financial centers enable elites to conceal associations between their identities and their wealth. Concealment may appeal for various reasons, such as tax avoidance, hiding how certain assets were acquired, or fear of assets making elites targets for extortion. Understanding how elites use offshore strategies could help inform public policy and deepen insights into inequality and financial crime. However, due to the secrecy of the offshore finance system, research on this topic has been limited.
To help fill the gaps, Chang and colleagues drew on publicly available records of elites' offshore finances from such sources as the 2016 Panama Papers and the 2017 Paradise Papers. They linked financial data of elites from 65 countries with additional publicly available data on different countries' political conditions, such as levels of civil and criminal justice, corruption, and regulatory enforcement.
They found that the offshore strategies used by elites varied according to the political conditions of their home countries. For instance, elites from countries with high corruption levels tended to diversify assets across various offshore financial centers instead of putting "all their eggs in one basket."
Meanwhile, elites from countries with high risk of government confiscation of assets were more likely to use identity-concealing offshore strategies, such as using others' names on documents to shield the elite's identity. Government confiscation can occur either because of fewer civil rights or rigorously fair application of the law, which could explain why elites from seemingly dissimilar countries, such as Sweden and Iran, use the same offshore strategy.
Elites from countries with both high corruption and unfair application of the law, such as Liberia and Belize, were more likely to use offshore financial centers that have been blacklisted by various countries, despite the practical and reputational risks of using them.
The authors note that more research is needed to confirm any cause-and-effect relationships between home-country politics and offshore strategies.
Daniel Rockmore adds: "Our overarching goal in this work is to better understand the patterns of 'secrecy' implicit in offshore investment. We see this as just one dimension of an evolving shadow financial system that serves the elites, often at the expense of average taxpayers. We hope that our results will be useful to policymakers concerned about this kind of financial drainage."
Ho-Chun Herbert Chang adds: "It has been an incredibly enriching experience working with Brooke, who's a qualitative sociologist and an expert in this area. There is a natural synergy between quantitative methods, machine learning, and qualitative expertise and intuition."
"Our analysis, specifically our metrics, are derived directly from observable network behavior produced by wealthy elites, rather than relying on expert ratings for financial secrecy."
In your coverage, please use this URL to provide access to the freely available article in PLOS One: http://plos.io/44y7XTd
Citation: Chang H-CH, Harrington B, Rockmore D (2025) Secrecy strategies: Global patterns in elites' quest for confidentiality in offshore finance. PLoS One 20(7): e0326228. https://doi.org/10.1371/journal.pone.0326228
Author countries: U.S.
Funding: We acknowledge the support of the National Science Foundation (Award No. 2419145).
