In the aftermath of an historic global economic crisis, forensic investigations have led us to appreciate more acutely than ever the dangers posed by secrecy jurisdictions to the overall stability of world markets. Before September 15, 2008, the infamous day that Lehman Brothers stunned the world by filing its petition for bankruptcy, only certain development experts, anti-corruption advocates, and specialized law enforcement experts devoted much energy to this problem. Some had warned us that the use of secrecy jurisdictions could undermine the entire global economy. In an American Interest essay that appeared in early August 2008, for example, Raymond Baker, John Christensen and Nicholas Shaxson focused on the dangers posed by offshore facilitation of “dirty money” flows, stating that “the current subprime and evolving credit crunch are . . . the leading edge of a deep, destabilizing global economic crisis.”¹ Indeed, a few observers—Robert Schiller and Richard Sylla among them—had been warning about the perils of secrecy jurisdictions, among other dangers, since the aftermath of the Black Monday stock market crash of October 1987. But few paid them much attention.

In the larger sense, then, opacity worked not just to help corporations make money but to deflect attention away from how they went about it. Now that a variety of recent investigations have shed light on different ways in which the use of secrecy jurisdictions played a major role in the financial meltdown—from AIG’s massive offshore booking of toxic commercial instruments to Goldman Sachs’s $57 billion subprime Altius III Funding, Ltd. Cayman Islands-registered scheme. Interest in the issue has now, not surprisingly, expanded.