Report shines light on shady money tactics
The release of a vast trove of documents and other data on offshore financial dealings of wealthy, famous and powerful people around the world is raising questions over the widespread use of tactics to avoid taxes and skirt financial oversight.
Reports by an international coalition of media outlets on an investigation with the US-based International Consortium of Investigative Journalists (ICIJ) brought to light details of offshore assets and services of politicians, businesses and celebrities, based on a cache of 11.5 million records.
Among the countries with past or present political figures named in the reports are Iceland, Ukraine, Pakistan, Saudi Arabia, Russia and Argentina.
Australia’s tax agency said yesterday it was investigating more than 800 wealthy people for possible tax evasion linked to their alleged dealings with Mossack Fonseca, a Panamanian law firm with international offices that provide offshore financial services and advice.
And there have been calls for Iceland’s Prime Minister Sigmundur David Gunnlaugsson to order a snap election after he was named in the report.
Ramon Fonseca, a co-founder of Mossack Fonseca - one of the world’s largest creators of shell companies - confirmed to Panama’s Channel 2 television network that documents investigated by the ICIJ were authentic and had been obtained illegally by hackers.
But he said most people named in the reports were not his firm’s direct clients but were accounts set up by intermediaries.
He said the firm did not engage in any wrongdoing.
Businessmen, criminals, celebrities and sports stars are mentioned - the ICIJ said the documents involve 214,488 companies and 14,153 clients of Mossack Fonseca. The non-profit group said it would release the full list of companies and people linked to them early next month.
“It [the investigation] allows a neverbefore-seen view inside the offshore world - providing a day-to-day, decade-by-decade look at how dark money flows through the global financial system, breeding crime and stripping national treasuries of tax revenues,” the ICIJ said.
According to the ICIJ’s website, banks including HSBC, UBS, Credit Suisse, Deutsche Bank have worked with Mossack Fonseca to create offshore accounts.
“The allegations are historical, in some cases dating back 20 years, predating our significant, well-publicised reforms implemented over the last few years,” HSBC spokesman Rob Sherman said in an email to The Associated Press.