Heads of state, govts hid millions offshore: Probe

WASHINGTON: More than a dozen heads of state and governments, including the King of Jordan and the Czech prime minister, have amassed millions in secret offshore assets, according to an investigation published on Sunday by the International Consortium of Investigative Journalists (ICIJ).

The so-called Pandora Papers investigation - involving some 600 journalists from dozens of media including The Washington Post and The Guardian - is based on the leak of some 11.9 million documents from 14 financial services companies around the world.

Hours before the leak, in a government letter released by local media, Panama’s government said it fears that the publication of a new expose about financial secrecy in global tax havens could again taint its reputation, which was seriously damaged by the “Panama Papers” scandal.

“The damage could be insurmountable,” the Panamanian government said in the letter, sent through a law firm to ICIJ.

The letter warns that “any publication” reinforcing “a false perception” of the country as a possible tax haven “will have devastating consequences for Panama and its people”.

The letter also references some of the reforms that the Central American country has made in recent years, although it remains on the EU list of tax havens.

It also indicates that since 2016 the registration of more than 395,000 companies and foundations has been suspended, around half of those existing at that time.

The government fears that Panama will again be the epicentre of a new global tax havens scandal like the one that followed the ICIJ’S disclosure of the Panama Papers in 2016.

That massive data leak exposed widespread tax avoidance and evasion using complex structures of offshore shell companies and caused an international outcry.

The leak, linked to the Panamanian law firm Mossack Fonseca, damaged Panama’s international image, despite the fact that most of the companies involved were overseas.

The investigation revealed the concealment of properties, companies, assets, profits and tax evasion by heads of state and government, political leaders and personalities from finance, sports and the arts.

Since then, Panama has carried out various legal reforms to strengthen banking controls and penalise tax evasion with jail time. The Panama of 2016 “is nothing like the Panama of today”, the government said in its letter.