PANAMA FALLOUT
Nations vow tax evasion investigations for those named in leaked bank documents
PANAMA CITY // Governments worldwide began investigating possible financial wrongdoing by the rich and powerful yesterday following a leak of documents from a Panama law firm that showed how clients avoided tax or laundered money. The documents detailed schemes involving an array of figures from friends of Russian president Vladimir Putin to relatives of the leaders of Britain, Iceland and Pakistan, as well as the Ukraine president, according to journalists who received the leaked documents. While the Panama Papers detail financial arrangements benefiting the world’s elite, they do not necessarily mean the schemes were all illegal. The Kremlin said the documents contained “nothing concrete and nothing new”, while a spokesman for British prime minister David Cameron said his late father’s reported links to an offshore company were a “private matter”.
Iceland’s prime minister Sigmundur Gunnlaugsson faced opposition calls to resign after the naming of his wife in connection with a secretive company in an offshore haven.
Pakistan denied any wrongdoing by the family of prime minister Nawaz Sharif after his daughter and son were linked to offshore companies, while Ukrainian president Petro Poroshenko denied any wrongdoing after the documents showed him holding three offshore accounts that could be used as tax havens.
Opponents said Mr Poroshenko should be impeached for allegedly transferring his confectionery business to an offshore company in 2014.
Australia, New Zealand, India, France and Austria were among countries that said they had begun investigating the allegations, based on more than 11.5 million documents from law firm Mossack Fonseca, located in the tax haven of Panama. Banks as well as individual cli- ents came under the spotlight.
The documents were leaked to the International Consortium of Investigative Journalists (ICIJ) and more than 100 other news organisations. Mossack Fonseca has denied any wrongdoing.
The material covers a period over almost 40 years, from 1977 until December, and allegedly show that some companies domiciled in tax havens were being used for suspected money laundering, arms and drug deals, and tax evasion.
Britain’s Guardian newspaper said the documents showed a network of secret offshore deals and loans worth US$ 2 billion (Dh7.35bn) led to close friends of Mr Putin, including concert cellist Sergie Rolddugin.
Mr Putin’s spokesman said the reports aimed to discredit him ahead of upcoming elections.
The British government asked for a copy of the leaked data. Mr Cameron’s father Ian is mentioned in the files, alongside some members of his Conservative Party in the upper house of parliament, former Conservative politicians and party donors.
Oslo said the Norwegian bank DNB must explain its policy of helping clients set up offshore companies in the Seychelles.
Dutch authorities said they would investigate allegations related to the Netherlands.
Sweden’s Financial Supervisory Authority has contacted authorities in Luxembourg to ask for information related to allegations that banking group Nordea helped some clients to set up accounts in offshore tax havens.
Tax authorities in Australia and New Zealand said they were probing local clients of Mossack Fonseca. The Australian tax office said it was investigating more than 800 clients and had linked more than 120 of them to an associate offshore service provider located in Hong Kong, which it did not name.