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TED2014

Charmian Gooch: My wish: To launch a new era of openness in business

March 18, 2014

Anonymous companies protect corrupt individuals – from notorious drug cartel leaders to nefarious arms dealers – behind a shroud of mystery that makes it almost impossible to find and hold them responsible. But anti-corruption activist Charmian Gooch hopes to change all that. At TED2014, she shares her brave TED Prize wish: to know who owns and controls companies, to change the law, and to launch a new era of openness in business.

Charmian Gooch - Anti-corruption activist
Charmian Gooch is the 2014 TED Prize winner. At Global Witness, she exposes how a global architecture of corruption is woven into the extraction and exploitation of natural resources. Full bio

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Double-click the English subtitles below to play the video.
I've come here today
00:11
to talk to you about a problem.
00:13
It's a very simple yet devastating problem,
00:15
one that spans the globe
00:19
and is affecting all of us.
00:21
The problem is
00:24
anonymous companies.
00:26
It sounds like a really dry and technical thing,
00:29
doesn't it?
00:31
But anonymous companies are making it difficult
00:32
and sometimes impossible
00:34
to find out
00:37
the actual human beings responsible
00:39
sometimes for really terrible crimes.
00:42
So, why am I here talking to all of you?
00:47
Well, I guess I am a lifelong troublemaker
00:52
and when my parents taught my twin brother and I
00:55
to question authority,
00:58
I don't think they knew where it might lead.
01:00
(Laughter)
01:02
And, they probably really regretted it
01:04
during my stroppy teenage years when, predictably,
01:06
I questioned their authority a lot.
01:09
And a lot of my school teachers
01:11
didn't appreciate it much either.
01:13
You see, since the age of about five
01:16
I've always asked the question, but why?
01:18
But why does the Earth go around the sun?
01:22
But why is blood red?
01:24
But why do I have to go to school?
01:26
But why do I have to respect the teachers
01:29
and authority?
01:31
And little did I realize
01:32
that this question would become the basis
01:34
of everything I would do.
01:37
And so it was
01:40
in my twenties, a long time ago,
01:41
that one rainy Sunday afternoon in North London
01:44
I was sitting with Simon Taylor
01:48
and Patrick Alley
01:50
and we were busy stuffing envelopes
01:52
for a mail out in the office of the campaign group
01:54
where we worked at the time.
01:57
And as usual, we were talking
about the world's problems.
01:59
And in particular, we were talking about
02:03
the civil war in Cambodia.
02:05
And we had talked about that
many, many times before.
02:08
But then suddenly we stopped
02:12
and looked at each other
02:14
and said, but why don't we try and change this?
02:16
And from that slightly crazy question,
02:20
over two decades
02:23
and many campaigns later,
02:24
including alerting the world
02:27
to the problem of blood diamonds funding war,
02:28
from that crazy question,
02:32
Global Witness is now an 80-strong team
02:34
of campaigners, investigators,
journalists and lawyers.
02:37
And we're all driven by the same belief,
02:41
that change really is possible.
02:43
So, what exactly does Global Witness do?
02:48
We investigate, we report,
02:51
to uncover the people really responsible
02:53
for funding conflict --
02:56
for stealing millions from citizens around the world,
02:58
also known as state looting,
03:01
and for destroying the environment.
03:03
And then we campaign hard to
change the system itself.
03:06
And we're doing this because
so many of the countries
03:11
rich in natural resources
03:14
like oil or diamonds or timber
03:16
are home to some of the poorest
03:18
and most dispossessed people on the planet.
03:21
And much of this injustice
03:25
is made possible
03:27
by currently accepted business practices.
03:28
And one of these is anonymous companies.
03:32
Now we've come up against anonymous companies
03:36
in lots of our investigations,
03:38
like in the Democratic Republic of Congo,
03:41
where we exposed how secretive deals
03:43
involving anonymous companies
03:46
had deprived the citizens
03:48
of one of the poorest countries on the planet
03:50
of well over a billion dollars.
03:54
That's twice the country's health
and education budget combined.
03:56
Or in Liberia,
04:01
where an international predatory logging company
04:03
used front companies as it attempted to grab
04:05
a really huge chunk of Liberia's unique forests.
04:08
Or political corruption in Sarawak, Malaysia,
04:12
which has led to the destruction
of much of its forests.
04:15
Well, that uses anonymous companies too.
04:18
We secretly filmed some of the family
04:23
of the former chief minister and a lawyer
04:25
as they told our undercover investigator
04:28
exactly how these dubious deals are done
04:30
using such companies.
04:33
And the awful thing is,
04:36
there are so many other examples out there
04:38
from all walks of life.
04:41
This truly is a scandal of epic proportions
04:45
hidden in plain sight.
04:49
Whether it's the ruthless Mexican drugs cartel,
04:52
the Zetas,
04:55
who use anonymous companies
to launder profits
04:56
while their drugs-related violence
04:58
is tearing communities apart across the Americas.
05:00
Or the anonymous company,
05:05
which bought up Americans' tax debts,
05:07
piled on the legal fees
05:09
and then gave homeowners a choice:
05:11
Pay up or lose your home.
05:12
Imagine being threatened with losing your home
05:15
sometimes over a debt of just a few hundred dollars,
05:18
and not being able to find out
05:21
who you were really up against.
05:22
Now anonymous companies
05:26
are great for sanctions busting too.
05:27
As the Iranian government found out
05:30
when, through a series of front companies,
05:32
it owned a building in the very heart of Manhattan,
05:34
on Fifth Avenue,
05:37
despite American sanctions.
05:40
And Juicy Couture, home of of the velvet track suit,
05:43
and other companies were the unwitting,
05:46
unknowing tenants there.
05:48
There are just so many examples,
05:51
the horesemeat scandal in Europe,
05:54
the Italian mafia, they've used these companies
05:56
for decades.
05:59
The $100 million American Medicare fraud,
06:00
the supply of weapons to wars around the world
06:06
including those
06:10
in Eastern Europe in the early '90s.
06:11
Anonymous companies
06:14
have even come to light
06:15
in the recent revolution in the Ukraine.
06:17
But, for every case that we and others expose
06:21
there are so many more that will remain hidden away
06:26
because of the current system.
06:29
And it's just a simple truth
06:31
that some of the people responsible
for outrageous crimes,
06:33
for stealing from you and me
06:38
and millions of others,
06:40
they are remaining faceless
06:42
and they are escaping accountability
06:43
and they're doing this with ease,
06:46
and they're doing it using legal structures.
06:48
And really, that is unfair.
06:51
Well, you might well ask,
06:56
what exactly is an anonymous company,
06:58
and can I really set one up, and use it,
07:01
without anyone knowing who I am?
07:04
Well, the answer is, yes you can.
07:06
But if you're anything like me,
07:08
you'll want to see some of that for yourself,
07:10
so let me show you.
07:12
Well first you need to work out
07:13
where you want to set it up.
07:15
Now, at this point you might be imagining
07:17
one of those lovely tropical island tax havens
07:19
but here's the thing,
07:22
shockingly,
07:24
my own hometown, London,
07:25
and indeed the U.K.,
07:28
is one of the best places in the world
07:29
to set up an anonymous company.
07:32
And the other, even better,
07:35
I'm afraid that's America.
07:37
Do you know, in some states across America
07:41
you need less identification
07:44
to open up a company
07:46
than you do to get a library card,
07:48
like Delaware,
07:51
which is one of the easiest places
07:52
in the world to set up an anonymous company.
07:54
Okay, so let's say it's America,
07:58
and let's say it's Delaware,
08:00
and now you can simply go online
08:02
and find yourself a company service provider.
08:04
These are the companies that
can set your one up for you,
08:07
and remember, it's all legal,
routine business practice.
08:10
So, here's one,
08:14
but there are plenty of others to choose from.
08:16
And having made your choice,
08:19
you then pick what type of company you want
08:20
and then fill in a contact, name and address.
08:23
But don't worry,
08:26
it doesn't have to be your name.
08:27
It can be your lawyer's
08:29
or your service provider's,
08:30
and it's not for the public record anyway.
08:32
And then you add the owner of the company.
08:36
Now this is the key part,
08:38
and again it doesn't have to be you,
08:40
because you can get creative,
08:42
because there is a whole universe
out there of nominees
08:44
to choose from.
08:48
And nominees are the people that you
08:50
can legally pay to be your company's owner.
08:52
And if you don't want to involve anyone else,
08:57
it doesn't even have to be an actual human being.
08:59
It could be another company.
09:02
And then finally,
09:05
give your company a name
09:06
add a few more details and make your payment.
09:08
And then the service provider
09:11
will take a few hours or more to process it.
09:12
But there you are,
09:15
in 10 minutes of online shopping
09:16
you can create yourself an anonymous company.
09:18
And not only is it easy,
09:23
really, really easy and cheap,
09:24
it's totally legal too.
09:27
But the fun doesn't have to end there,
09:29
maybe you want to be even more anonymous.
09:33
Well, that's no problem either.
09:35
You can simply keep adding layers,
09:38
companies owned by companies.
09:40
You can have hundreds of layers
09:42
with hundreds of companies spread across
09:44
lots of different countries,
09:46
like a giant web,
09:49
each layer adds anonymity.
09:50
Each layer makes it more difficult
09:52
for law enforcement and others
09:54
to find out who the real owner is.
09:56
But whose interests is this all serving?
09:59
It might be in the interests of the company
10:03
or a particular individual,
10:06
but what about all of us, the public?
10:07
There hasn't even been a global conversation yet
10:10
about whether it's okay
10:12
to misuse companies in this way.
10:14
And what does it all mean for us?
10:17
Well, an example that really haunts me
10:21
is one I came across recently.
10:24
And it's that of a horrific fire
10:26
in a nightclub in Buenos Aires
10:28
about a decade ago.
10:30
It was the night before New Year's Eve.
10:33
Three thousand very happy revelers,
10:35
many of them teenagers,
10:37
were crammed into a space meant for 1,000.
10:38
And then tragedy struck,
10:41
a fire broke out
10:42
plastic decorations were melting from the ceiling
10:44
and toxic smoke filled the club.
10:46
So people tried to escape
10:48
only to find that some of the fire doors
10:50
had been chained shut.
10:53
Over 200 people died.
10:56
Seven hundred were injured trying to get out.
10:59
And as the victims' families
and the city and the country
11:03
reeled in shock,
11:06
investigators tried to find out who was responsible.
11:08
And as they looked for the owners of the club,
11:11
they found instead anonymous companies,
11:14
and confusion surrounded the identities of those
11:17
involved with the companies.
11:20
Now ultimately, a range of people were charged
11:22
and some went to jail.
11:25
But this was an awful tragedy,
11:27
and it shouldn't have been so difficult
11:28
just to try and find out who was responsible
11:30
for those deaths.
11:34
Because in an age
11:37
when there is so much information
11:39
out there in the open,
11:42
why should this crucial information
11:44
about company ownership
11:45
stay hidden away?
11:47
Why should tax evaders, corrupt
government officials,
11:48
arms traders and more,
11:52
be able to hide their identities from us, the public?
11:54
Why should this secrecy be such
an accepted business practice?
11:58
Anonymous companies
12:04
might be the norm right now
12:06
but it wasn't always this way.
12:08
Companies were created
12:10
to give people a chance to innovate
12:12
and not have to put everything on the line.
12:14
Companies were created to limit financial risk,
12:18
they were never intended to
be used as a moral shield.
12:21
Companies were never intended to be anonymous,
12:26
and they don't have to be.
12:28
And so I come to my wish.
12:31
My wish is for us to know
12:34
who owns and controls companies
12:36
so that they can no longer be used anonymously
12:39
against the public good.
12:42
Together let's ignite world opinion,
12:44
change the law,
12:47
and launch a new era of openness in business.
12:49
So what might this look like?
12:53
Well, imagine if you could go online
12:55
and look up the real owner of a company.
12:58
Imagine if this data were open and free,
13:01
accessible across borders
13:04
for citizens and businesses
13:05
and law enforcement alike.
13:07
Imagine what a game changer that would be.
13:09
So how are we going to do this?
13:13
Well, there is only one way.
13:16
Together, we have to change the law globally
13:17
to create public registries
13:20
which list the true owners of companies
13:22
and can be accessed by all
13:25
with no loopholes.
13:27
And yes, this is ambitious,
13:29
but there is momentum on this issue,
13:33
and over the years I have seen
13:36
the sheer power of momentum,
13:38
and it's just starting on this issue.
13:40
There is such an opportunity right now.
13:42
And the TED community
13:46
of creative and innovative thinkers and doers
13:48
across all of society
13:51
could make the crucial difference.
13:53
You really can make this change happen.
13:56
Now, a simple starting point
14:00
is the address behind me
14:02
for a Facebook page that you can join now
14:03
to support the campaign and spread the word.
14:06
It's going to be a springboard
14:08
for our global campaigning.
14:10
And the techies among you,
14:12
you could really help us create a prototype
14:13
public registry
14:17
to demonstrate what a powerful tool this could be.
14:18
Campaign groups from around the world
14:23
have come together to work on this issue.
14:26
The U.K. government is already on board;
14:31
it supports these public registries.
14:34
And just last week,
14:36
the European Parliament came on board
14:38
with a vote 600 to 30 in favor of public registries.
14:41
That is momentum.
14:46
(Applause)
14:48
But it's early days.
14:53
America still needs to come on board,
14:56
as do so many other countries.
14:58
And to succeed we will all together
15:02
need to help and push our politicians,
15:05
because without that,
15:07
real far-reaching, world-shifting change
15:09
just isn't going to happen.
15:11
Because this isn't just about changing the law,
15:13
this is about starting a conversation
15:16
about what it's okay for companies to do,
15:18
and in what ways is it acceptable
to use company structures.
15:21
This isn't just a dry policy issue.
15:26
This is a human issue
15:28
which affects us all.
15:30
This is about being on the right side of history.
15:33
Global citizens, innovators,
business leaders, individuals,
15:39
we need you.
15:44
Together, let's kickstart this global movement.
15:46
Let's just do it,
15:50
let's end anonymous companies.
15:51
Thank you.
15:55
(Applause)
15:57

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Charmian Gooch - Anti-corruption activist
Charmian Gooch is the 2014 TED Prize winner. At Global Witness, she exposes how a global architecture of corruption is woven into the extraction and exploitation of natural resources.

Why you should listen

Charmian Gooch co-founded the watchdog NGO Global Witness with colleagues Simon Taylor and Patrick Alley in 1993, in response to growing concerns over covert warfare funded by illicit trade. Since then, Global Witness has captured headlines for their exposé of "blood diamonds" in Uganda, of mineral exploitation in the Congo, of illegal timber trade between Cambodia and Thailand, and more. With unique expertise on the shadowy threads connecting corrupt businesses and governments, Global Witness continues its quest to uncover and root out the sources of exploitation.

In 2014, Gooch and Global Witness were awarded the $1 million TED Prize, along with the Skoll Award for Social Entrepreneurship, for their campaign to end anonymous companies. Gooch's TED Prize wish: for us to know who ultimately owns and controls companies and launch a new era of openness in business. Global Witness highlighted the importance of this issue in an investigation, aired on 60 Minutes, where they sent an undercover investigator into 13 New York law firms. The investigator posed as an adviser to a government minister in Africa and asked for thoughts on how to move money into the United States for a plane, a yacht and a brownstone. All but one firm offered advice. 

The Panama Papers, released in April of 2016, further demonstrate the need for transparency. The papers paint a picture of how the rich and powerful around the world use offshore accounts and anonymous companies to move money. "This secretive world is being opened up to global public scrutiny," said Gooch, on the day the papers were released.

 

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