FIVE THINGS ABOUT THE PANAMA PAPERS
1 WHAT ARE THEY?
The papers published by an international coalition of media outlets this week document the shady business dealings by a who’s who of the global elite. The massive trove of documents includes emails, banking details and client records of about 214,488 offshore entities from Mossack Fonseca dating back some 40 years.
2 HOW WERE THEY ACCESSED?
Mossack Fonseca, a Panama-based law firm, is the world’s fourthlargest creators of shell companies. It has acted on behalf of more than 300,000 companies. Co-founder Ramon Fonseca told Panama’s Channel 2 TV network that the documents were obtained illegally in a hacking attack.
3 ARE OFFSHORE ACCOUNTS ILLEGAL?
Companies or trusts can be set up in offshore locations for legitimate uses such as business finance, mergers and acquisitions and estate or tax planning, according to the global money laundering watchdog, the Financial Action Task Force. But terrorists and others involved in international and financial crimes can also misuse shell companies and other entities to conceal sources of funds and ownership.
4 WHY SHOULD YOU CARE?
The leak reveals an unprecedented pattern of worldwide corruption, including several major banks that created the hard-to-trace companies. Some files relate to suspected money laundering, arms and drug deals and tax evasion. Of particular interest are the accounts of several world leaders or their associates who have embraced anticorruption platforms.
5 WHAT’S THE FALLOUT?
Laws vary by country, and it remains to be seen whether any international conventions were violated or the money could be seized. The political fallout, however, has already begun, with calls for resignations and impeachments of at least two world leaders.