How Panama became a tax haven to the world

http://www.usatoday.com/story/news/world/2016/04/09/panama-papers-offshore-accounts-mossack-fonseca/82763268/
http://www.usatoday.com/story/news/world/2016/04/09/panama-papers-offshore-accounts-mossack-fonseca/82763268/
A USA TODAY motion graphic highlighting politicians around the world linked to the Panama Papers data leak. By George Petras, Ramon Padilla, Frank Pompa and Berna Elibuyuk, USA TODAY
MIAMI — Anyone familiar with Panama's economic history isn't surprised by revelations of shell companies and hidden assets created by a law firm based in the small nation.
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"I've been screaming about it for decades," said Jack Blum, an attorney and former U.S. Senate staff who focused on international tax evasion.
In fact, Panama has been a widely-used tax haven for nearly a century, a practice that goes all the way back to U.S. industrialist John D. Rockefeller that has evolved into a complex relationship between the country's banking, legal and financing sectors. That long, secretive history came crashing out this week with the release of the Panama Papers, which revealed exactly how Panama has created conditions for foreigners to hide their assets through corporations there.

The influx of foreign cash to take advantage of that system is so big that Panama's financing sector accounts for 7% of the country's entire GDP.
"You can walk into a bank there with a stack of U.S. money and they just say, 'Fine,'" Blum said. "This has been going on for so long, and is so obvious and problematic, that the question is, 'How come nothing was done about it before?'"