The story of offshore finance is a familiar one. Individuals or companies want to avoid taxes, fines, lawsuits, or investigations, so they move their wealth to the Cook Islands, or register some part of their business in Switzerland. The millionaire can still live and spend in America, the business can sell Brazilian beef to China, but their cash takes a few detours through tax havens. As the author Nicholas Shaxson puts it, “You take your money elsewhere, to another country, in order to escape the rules and laws of the society in which you operate.”
One aspect of Shaxson’s 2011 book Treasure Islands is especially disturbing, not least for Catholics at the present moment. Shaxson has a skill for finding offshore’s outsiders and telling their stories. They describe a world that, quietly but forcefully, defends wrongdoers. An unnamed “former hedge fund administrator” in the Cayman Islands found that, when he raised concerns about crooked accounting, he began to be shut out of important conversations. It’s typical of the system, he says. No threats are made explicitly, no anger is shown; but those who don’t fit in will be excluded—or given huge amounts of work, or subtly reminded that “If you speak in one place, the network works in a way that you will never get work again.” The ex-banker Beth Krall tells Shaxson that not only do the bank chiefs all know each other, they also know the police and the regulators. A lawyer in Jersey, who spoke up about the corruption he saw at first hand, says bluntly: “I have all the qualifications, and I couldn’t get a job in a law firm to make tea now.”
The iron fist is covered by luxurious velvet. William Taylor, an Anglican clergyman and a councillor in the City of London, was invited to official functions where he voiced his objections to tax havens. He was rebuked—but in the nicest way possible: “On the whole people were very genial and friendly. That’s where it gets dangerous: you become part of it, then it’s easier not to say anything.” Another anonymous interviewee, described as a “former senior offshore accountant,” echoes Taylor’s narrative. “Once you become part of senior management and gain international experience, then you are part of the inner circle and things become much clearer. You are part of the plot. You know what the real products and services are, and why they are so expensive.” It’s easy not to know too much: The nature of offshore is that the real owner, or the real administrator, may be hidden somewhere amid a lengthy chain of trusts, investments, and accounts.
Perhaps the parallel has struck you too. A world of complex networks where serious malfeasance is half-hidden from view, where silent complicity is rewarded while potential whistleblowers are put off with fake smiles and the threat of vengeance. You do not have to be a crazed anticlerical to be reminded of the scandals of the last year: the widely-known predations of Archbishop McCarrick, the drug-fuelled orgy in a Vatican flat, the culture of organized sexual activity and cover-up in seminaries. It appears that some corners of the clergy are—to use an appropriately grim phrase—sex havens, where moral and canonical laws about sexuality are treated the same way moral and financial rules are sometimes treated in tax havens.
It's important not to overstate the problem. But it only takes a few bad clerics to do a lot of damage. The psychotherapist Richard Sipe, a pioneering expert on sex abuse, claimed in 2004 that some priests find themselves in an impossible situation. The dynamic of sexual misconduct
affects even good, observant clergy who cannot speak openly because the secret system will not tolerate them. Where are they to go? The press will not touch malfeasance on this level of the power system without impossible vetting that will expose the whistler blower [sic] to potential or certain destruction. Who of the many-in-the-know within the secret clerical system have that kind of courage?
Their dilemma closely resembles that of the lawyer or accountant who knows, or guesses, what his firm is up to but has nowhere to turn.
At the center of financial corruption are practices almost everybody would recognize as wicked: laundering the profits of human trafficking, for instance. Further out are those acts some people see as relatively harmless—a little “rearrangement” for the sake of “efficiency”—but which cannot be justified on any traditional understanding of ethics. Beyond that is a general atmosphere of rule-bending and amorality. And all this is surrounded by the nervous silence of those who know they might wreck their careers if they say anything.
In the worst parts of the clergy, too, there are concentric circles of wrongdoing. Nobody would try to defend the sexual abuse of minors. But there are other grave sexual sins, straight or gay, which the world—and sadly a large part of the Church—has forgotten how to disapprove of. Further out, there is an atmosphere of sexual gossip and intrigue, and a refusal to take difficult doctrines seriously. And, again, the outermost circle consists of an enveloping silence, because to speak out is to court destruction.
But something is missing from both these descriptions. People don’t just sin, they—we—try to justify our sins. Where sin aboundeth, rationalization aboundeth too. So the soothing doctrines about money and sex that have flourished in the last fifty years have helped to enable both kinds of haven. Financial irresponsibility could not have grown so far, so fast, if the atmosphere hadn’t been polluted with certain ideas—that a business’s “sole responsibility” is to increase its profits, that government intervention is at odds with “individual liberty,” and so on. And the sexual disorder in the Church could not have got to this point without all those bogus theories about morality (which is, supposedly, never “black-and-white”) and conscience (which can, we are told, “discern” which intrinsically immoral acts are in fact okay).
The criminals should be caught and punished; the systems that protected them should be broken down; the potential whistleblowers should feel certain that they will be rewarded rather than frozen out. But lasting reform will also include the clearing-away of bankrupt ideologies.
Dan Hitchens is deputy editor of the Catholic Herald.