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Countries with politicians, public officials or close associates so far implicated in the leak.[1]

The Panama Papers[2] are a leaked set of 11.5 million confidential documents created by the Panamanian corporate service provider Mossack Fonseca that provide detailed information on more than 214,000 offshore companies, including the identities of shareholders and directors. The documents name the leaders of five countries — Argentina, Iceland, Saudi Arabia, Ukraine and the United Arab Emirates — as well as government officials, close relatives and close associates of various heads of government of more than 40 other countries, including Brazil, China, France, India, Malaysia, Mexico, Malta, Pakistan, Russia, South Africa, Spain, Syria and the United Kingdom.[1]

Comprising documents created since the 1970s, the 2.6 terabyte set was given by an anonymous source to the German newspaper Süddeutsche Zeitung in 2015 and subsequently to the US-based International Consortium of Investigative Journalists (ICIJ).[3] The papers were distributed to and analyzed by about 400 journalists at 107 media organizations in more than 80 countries. The first news reports based on the set, along with 149 of the documents themselves,[4] were published on April 3, 2016.[5] Among other planned disclosures, the full list of companies is to be released in early May 2016.[6]

Background

Mossack Fonseca is a Panamanian law firm and corporate service provider founded in 1977 by Jürgen Mossack and Ramón Fonseca.[7] The company's services include incorporating companies in offshore jurisdictions, administering offshore firms and providing wealth management services.[8] A 2012 Economist article said it is believed to be an industry leader in its country.[9] The company has more than 500 employees in over 40 offices around the world.[7] The firm has acted on behalf of more than 300,000 companies, most of which are registered in the UK or are British-administered tax havens.[8]

The firm works with the world's biggest financial institutions, such as Deutsche Bank, HSBC, Société Générale, Credit Suisse, UBS, Commerzbank and Nordea.[7][10] Before the Panama Papers leak, Mossack Fonseca was described by the Economist as a "tight-lipped" industry leader in offshore finance.[11]

An article on the Australian Broadcasting Corporation website explains:[12]

Using complex shell company structures and trust accounts Mossack Fonseca services allow its clients to operate behind an often impenetrable wall of secrecy. Mossack Fonseca's success relies on a global network of accountants and prestigious banks that hire the law firm to manage the finances of their wealthy clients. Banks are the big drivers behind the creation of hard-to-trace companies in tax havens. Much of the firm's work is perfectly legal and benign. But for the first time the leak takes us inside its inner workings, providing rare insight into an operation which offers shady operators plenty of room to manoeuvre.

Contents

The leak consists of 11.5 million documents created between the 1970s and late 2015 by the Panama-based Mossack Fonseca, which The Guardian described as "the world's fourth biggest offshore law firm".[13] The 2.6 terabytes of data include information on 214,488 offshore entities related to public officials.[14] The papers were reviewed by journalists across 80 countries.[13] Gerard Ryle, director of the International Consortium of Investigative Journalists, believed the leak would be "probably the biggest blow the offshore world has ever taken because of the extent of the documents."[15]

People

Main article: List of people named in the Panama Papers

Early reports noted financial and power connections between multiple high-ranking political figures and their relatives.[16][13][1] For example, the Argentine President Mauricio Macri was listed as a director of a Bahamas-based trading company that he did not disclose during his tenure as Mayor of Buenos Aires; it is not clear whether disclosure of non-equity directorships was then required.[16] The Guardian reported that the leak revealed an extensive conflict of interest connection between a member of the FIFA Ethics Committee and former FIFA vice president Eugenio Figueredo.[17]

Several current national leaders have been named in the Panama Papers, including presidents Mauricio Macri of Argentina, Khalifa bin Zayed Al Nahyan of the United Arab Emirates, Petro Poroshenko of Ukraine, as well as King Salman of Saudi Arabia, and the Prime Minister of Iceland Sigmundur Davíð Gunnlaugsson.[1] Among the former country leaders, there were prime ministers of Georgia (Bidzina Ivanishvili), Iraq (Ayad Allawi), Jordan (Ali Abu al-Ragheb), Qatar (Hamad bin Jassim bin Jaber Al Thani) and Ukraine (Pavlo Lazarenko), as well as Sudanese President Ahmed al-Mirghani and Emir of Qatar Hamad bin Khalifa Al Thani.[1]

Government officials, as well as close relatives and close associates of various heads of government from well over 40 different countries have also been named, including those from Algeria, Angola, Argentina, Azerbaijan, Botswana, Brazil, Cambodia, Chile, China, Democratic Republic of the Congo, Republic of the Congo, Ecuador, Egypt, France, Ghana, Greece, Guinea, Honduras, Hungary, Iceland, India, Israel, Italy, Ivory Coast, Kazakhstan, Kenya, Malaysia, Mexico, Morocco, Malta, Nigeria, Pakistan, Panama, Peru, Poland, Russia, Rwanda, Saudi Arabia, Senegal, South Africa, Spain, Syria, Taiwan, United Kingdom, Venezuela and Zambia.[1] Although initially noted that there were no people from the United States in the Panama papers,[18] this is incorrect.[19] According to The Guardian, the name of Vladimir Putin "does not appear in any of the records", but it published a lengthy article about three of his friends on the list, claiming that business success of his friends "could not have been secured without his patronage".[20]

Icelandic Prime Minister Sigmundur Davíð Gunnlaugsson

The data also shows how Icelandic Prime Minister Sigmundur Davíð Gunnlaugsson had an undeclared interest in his country's failed banks, hidden behind an offshore company. Leaked documents show that he and his wife bought offshore company Wintris Inc. in 2007. The ICIJ said that they bought it "from Mossack Fonseca through the Luxembourg branch of Landsbanki, one of Iceland’s three big banks".[21] He did not declare an interest in the company when entering parliament in 2009, and sold his 50% of Wintris to his wife, eight months later, for $1.[15] Sigmundur Davíð is now facing calls for his resignation, but on 4 April 2016 he announced on live television that he would not be resigning in the wake of the Panama Papers revelations, calling its content "nothing new".[22] He says he has not broken any rules, and his wife did not benefit financially from his decisions.[15]

Several high profile individuals connected with the world governing body of association football, FIFA, include former President of CONMEBOL Eugenio Figueredo,[17] former President of UEFA Michel Platini,[23] former Secretary General of FIFA Jérôme Valcke,[23] as well as current Argentine player Lionel Messi. From Italy the head manager of "Metro" Antonio Guglielmi [17] Indian actors Amitabh Bachchan and Aishwarya Rai Bachchan have been named among other Indians by The Indian Express .[24]

Companies

Mossack Fonseca has managed a large number of companies over the years, with the number of active companies having peaked at over 80,000 in 2009. Over 210,000 companies in 21 offshore jurisdictions appear in Mossack Fonseca’s files, more than half of which were incorporated in the British Virgin Islands and many others in Panama, the Bahamas, the Seychelles, Niue, and Samoa. Over the years, Mossack Fonseca worked with clients in more than 100 countries; most of the corporations were from Hong Kong, Switzerland, the United Kingdom, Luxembourg, Panama, and Cyprus. Mossack Fonseca worked with more than 14,000 banks, law firms, incorporators and others to set up companies, foundations, and trusts for these clients. More than 500 banks registered nearly 15,600 shell companies with Mossack Fonseca, with HSBC and its affiliates created more than 2,300 in total. Dexia (Luxembourg), J. Safra Sarasin (Luxembourg), Credit Suisse (Channel Islands) and UBS (Switzerland) each requested at least 500 offshore companies for their clients,[25] while Nordea (Luxembourg) requested nearly 400.[10]

Leak

More than a year before the first publication of the Panama leaks in April 2016, the German newspaper Süddeutsche Zeitung received 2.6 terabytes of documents related to Mossack Fonseca from an anonymous source.[5]

The total size of the leaked documents dwarfs that of the Wikileaks Cablegate 2010[5] (1.7 GB),[26] Offshore Leaks 2013 (260 GB), Lux Leaks 2014 (4 GB), and Swiss Leaks 2015 (3.3 GB). The data primarily comprises e-mails, PDF files, photos, and excerpts of an internal Mossack Fonseca database. It covers a period spanning from the 1970s to 2016.[5] The Panama Papers leak provide data on some 214,000 companies. There is a folder for each shell firm that contains e-mails, contracts, transcripts, and scanned documents.[5] The leak comprises 4,804,618 emails, 3,047,306 database format files, 2,154,264 PDFs, 1,117,026 images, 320,166 text files, and 2,242 files in other formats.[5]

The data had to be systematically indexed. This was done with proprietary software developed by an Australian company named Nuix, which is also used by international investigators. The documents were fed to high-performance computers for optical character recognition processing, making the data machine-readable and searchable. Compiled lists of important people were then cross matched against the processed documents.[5] The next step in the analysis is to connect people, roles, monetary flow, and structure legality.[5]

Reaction

In response to queries from the The Miami Herald, Mossack Fonseca identified legal and compliance regimes around the world that reduce the ability of individuals to use offshore companies for tax avoidance and total anonymity. In particular, they cited the FATF protocols that (for companies and financial institutions in the majority of countries in the world) require identification of ultimate beneficial owners of all companies (including offshore companies) to open accounts and transact business.[27]

Following an interview in advance of the leak, Icelandic Prime Minister Sigmundur Davíð Gunnlaugsson and his wife issued public statements about journalist encroachment in their private lives and insisted on the completeness of their legal disclosures. Sigmundur Davíð was expected to receive calls for a snap election in parliament.[28]

An HSBC spokesman commented that "the allegations are historical, in some cases dating back 20 years, predating our significant, well-publicized reforms implemented over the last few years."[29]

The leak was described by Edward Snowden as the "biggest leak in the history of data journalism".[30]

French President François Hollande hailed the leaks that would "increase tax revenues from those who commit fraud".[15]

Official reactions and investigations

Australia

The Australian Tax Office subsequently announced that it was investigating 800 individual Australian taxpayers who were clients of Mossack Fonseca and that some of the cases could be referred to the country's Serious Financial Crime Task Force.[31]

India

Popular Indian celebrities such as Amitabh Bachchan and Aishwarya Rai Bachchan are involved according to these papers. Indian Prime minister Narendra Modi ordered an enquiry.[32]

New Zealand

New Zealand's Inland Revenue Department said that they were working to obtain details of people resident for tax in the country who may have been involved in arrangements facilitated by Mossack Fonseca.[33]

Ukraine

Ukrainian President Petro Poroshenko promised voters he would sell his candy business, Roshen, when he ran for office, but the leaked documents indicated that instead he set up an offshore holding company to move his business to the British Virgin Islands, possibly saving millions of dollars in Ukrainian taxes.[34] After the revelation, Oleh Lyashko, leader of the Radical Party, urged lawmakers to initiate impeachment proceedings against Poroshenko.[34] The scandal flared up amid bitter political infighting between Poroshenko's bloc and the party of Prime Minister Arseniy Yatsenyuk, which has raged for months and involved mutual accusations of corruption.[34]

United Kingdom

Jennie Granger, a spokeswoman for the United Kingdom's tax authority, HM Revenue and Customs (HMRC), said the organisation had received "a great deal of information on offshore companies, including in Panama, from a wide range of sources, which is currently the subject of intensive investigation". She said the ICIJ had been asked to share all its data with HMRC.[15][35]

See also

References

  1. ^ a b c d e f "Panama Papers: The Power Players". International Consortium of Investigative Journalists. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: |archive-date= / |archive-url= timestamp mismatch; April 4, 2016 suggested (help); Unknown parameter |dead-url= ignored (|url-status= suggested) (help)
  2. ^ "Panama Papers: ICIJ Leaks". The Reporter Times. April 4, 2016. Retrieved April 4, 2016.
  3. ^ Vasilyeva, Natalya; Anderson, Mae (April 3, 2016). "News Group Claims Huge Trove of Data on Offshore Accounts". The New York Times. Associated Press. Retrieved April 4, 2016.
  4. ^ "DocumentCloud 149 Results Source: Internal documents from Mossack Fonseca (Panama Papers) – Provider: Amazon Technologies / Owner: Perfect Privacy, LLC USA". Center for Public Integrity. Retrieved April 4, 2016.
  5. ^ a b c d e f g h Obermaier, Frederik; Obermayer, Bastian; Wormer, Vanessa; Jaschensky, Wolfgang (April 3, 2016). "About the Panama Papers". Süddeutsche Zeitung. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  6. ^ "The Panama Papers: Data Metholodogy". ICIJ. April 3, 2016. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  7. ^ a b c Hamilton, Martha M. (April 3, 2016). "Panamanian Law Firm Is Gatekeeper To Vast Flow of Murky Offshore Secrets". International Consortium of Investigative Journalists. Archived from the original on April 3, 2016. Retrieved April 4, 2016.
  8. ^ a b Harding, Luke (April 3, 2016). "The Panama Papers: what you need to know". The Guardian. ISSN 0261-3077. Archived from the original on April 3, 2016. Retrieved April 4, 2016.
  9. ^ "Shells and Shelves". The Economist. April 7, 2012. Retrieved April 4, 2016.
  10. ^ a b "Monday's papers". YLE. April 4, 2016. Retrieved April 4, 2016.
  11. ^ Silverstein, Ken (December 3, 2014). "The Law Firm That Works with Oligarchs, Money Launderers, and Dictators". Vice Media. VICE Magazine. Retrieved April 4, 2016. {{cite web}}: |archive-url= is malformed: save command (help)
  12. ^ "Panama Papers and Mossack Fonseca explained". Australian Broadcasting Corporation. April 4, 2016. Retrieved April 4, 2016.
  13. ^ a b c Garside, Juliette; Watt, Holly; Pegg, David (April 3, 2016). "The Panama Papers: how the world's rich and famous hide their money offshore". The Guardian. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  14. ^ "Giant leak of offshore financial records exposes global array of crime and corruption". OCCRP. The International Consortium of Investigative Journalists. April 3, 2016. Archived from the original on April 3, 2016.
  15. ^ a b c d e Bilton, Richard (April 3, 2016). "Panama Papers: Mossack Fonseca leak reveals elite's tax havens". BBC News. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  16. ^ a b Fusion Investigative Unit (April 3, 2016). "Here are the famous politicos in 'the Wikileaks of the mega-rich'". Fusion. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  17. ^ a b c Gibson, Owen (April 3, 2016). "Leaked papers give Fifa ethics committee new credibility crisis". The Guardian. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  18. ^ Mills, Jen (April 4, 2016). "Why are there no US people in the Panama papers?". Metro. London. Retrieved April 4, 2016.
  19. ^ Bilton, Richard (April 4, 2016). "Panama Papers: How a British man, 90, covered for a US millionaire". BBC News. Retrieved April 4, 2016.
  20. ^ Harding, Luke (April 3, 2016). "Revealed: the $2bn offshore trail that leads to Vladimir Putin". The Guardian. London.
  21. ^ Ferro, Shane (April 3, 2016). "Icelandic Prime Minister Had Stake In Failed Banks, Leaks Suggest". The Huffington Post. Retrieved April 4, 2016.
  22. ^ "Iceland PM: "I will not resign"". Iceland Monitor. Morgunblaðið. April 4, 2016. Retrieved April 4, 2016.
  23. ^ a b "Group of death: FIFA officials' financial secrets exposed in new Wikileaks-style trove". Fusion. April 3, 2016. Retrieved April 3, 2016.
  24. ^ "Indians in Panama Papers list: Amitabh Bachchan, KP Singh, Aishwarya Rai, Iqbal Mirchi, Adani elder brother". The Indian Express. April 4, 2016. Retrieved April 4, 2016.
  25. ^ "The Panama Papers Numbers". panamapapers.icij.org. Retrieved April 4, 2016.
  26. ^ Kraft, Steffen (August 25, 2011). "Leck bei Wikileaks". Der Freitag (in German). Archived from the original on March 7, 2012. Retrieved March 7, 2012. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help); Unknown parameter |trans_title= ignored (|trans-title= suggested) (help)
  27. ^ "Mossack Fonseca responds to Miami Herald 'Secret Shell Game' series on offshore companies". The Miami Herald. April 3, 2016. {{cite news}}: |access-date= requires |url= (help)
  28. ^ Bowers, Simon (April 3, 2016). "Iceland's PM faces calls for snap election after offshore revelations". The Guardian. Archived from the original on April 3, 2016. Retrieved April 3, 2016. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  29. ^ "Trove of Data on Offshore Accounts Prompts Probe, Questions". The New York Times. The Associated Press. April 4, 2016. ISSN 0362-4331. Retrieved April 4, 2016.
  30. ^ Snowden, Edward. "Twitter". Twitter. Archived from the original on April 3, 2016. Retrieved April 3, 2016. Biggest leak in the history of data journalism just went live, and it's about corruption. http://panamapapers.sueddeutsche.de/en/ {{cite web}}: External link in |quote= (help)
  31. ^ Chenoweth, Neil (April 4, 2016). "Panama Papers: ATO investigating more than 800 Australian clients of Mossack Fonseca". Sydney Morning Herald. Retrieved April 4, 2016.
  32. ^ "PM Modi steps in: Income Tax, RBI panel to probe Panama Papers trail". The Indian Express. April 4, 2016.
  33. ^ Wardell, Jane; Moreno, Elida (April 4, 2016). "Tax authorities begin probes into some people named in Panama Papers leak". Reuters. Retrieved April 4, 2016.
  34. ^ a b c Karmanau, Yuras (April 4, 2016). "Ukrainian president under fire over Panama Papers". Associated Press. Retrieved April 4, 2016.
  35. ^ "HMRC ready to follow up Panama papers allegations". ITV News. April 4, 2016. Retrieved April 4, 2016.
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