Panama Papers Implicate World Leaders in Money Laundering

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On April 3, 2016, the Panama Papers were leaked, implicating many world leaders of money laundering. The International Consortium of Investigative Journalists (ICIJ) received more than 11 million documents, which the group has been examining from an anonymous source. The documents date back four decades and were linked to the Panamanian law firm, Mossack Fonseca. The people implicated span the Americas, Africa, Asia, Europe, and the Middle East.

The Panama Papers are a series of documents that reveal Mossack Fonseca helped created secret shell companies in places, such as the Seychelles. The set of islands are located in the Indian Ocean and often described as a tax haven. Shell companies do not make any products, have employees, or facilities. They can be used to hide assets and avoid taxes people would have to pay to their native governments.

CNNMoney reported Mossack Fonseca was the law firm at the epicenter of offshore holdings. They have advised scores of entrepreneurs and world leaders how to distribute assets.

Reports coming from CNN claim the documents reference 12 world leaders and 128 politicians. The first political casualty of these papers was Icelandic Prime Minister Sigmundur David Gunnlaugsson. Documents revealed he and his wife created offshore accounts via a shell company. He stepped down on Tuesday, April 5. There have been reports of massive protests in Icelandic streets.

An anonymous source relinquished the documents to a German newspaper, Suddeustche Zeitung, and the paper gave them to the ICIJ. Gerard Ryle, director of the ICIJ, said the anonymous source “claimed to be concerned about what he or she saw in the documents.” The source claimed they were in fear for their life if it became known they revealed the documents.

The ICIJ is still processing the 11 million documents known as the Panama Papers, which implicate world leaders of money laundering. According to CNN, Britain, France, Australia, and Mexico have promised an investigation into tax evasion. President Obama stated using offshore tax havens is not illegal “[and] that’s the problem.”

NPR reported the team of journalists is sifting through the documents. A full list of people and corporations implicated will be released sometime in May 2016.

In Chile, the head of the Office of Transparency International stepped down on April 4. The director of the anti-corruption watchdog was tied to offshore companies.

Argentina has three public figures who were revealed in the Panama Papers. The soccer player, Lionel Messi, President Mauricio Macri, and an associate of the former President Nestor Kirchner have all been implicated.

Across Europe, high ranking members of society were named. In England, Prime Minister David Cameron’s father was involved in offshore activities. Spain was also struck by the scandal. Director Pedro Almodóvar, his brother, and the aunt of Spain’s King Felipe VI were all mentioned.

Farther East, several prominent Chinese families were named in the Panama Papers. NPR stated the brother-in-law of President Xi Jinping was involved in offshore activities. Anthony Kuhn of NPR reported the news of this event has been heavily censored by China.

While Vladimir Putin was not named specifically, many in his close circle were. The group may include some of the rich and powerful of Russia.

In a press release given by Mossack Fonseca, the firm stated:

“The facts are these: while we may have been the victim of a data breach, nothing we’ve seen in this illegally obtained cache of documents suggests we’ve done anything illegal, and that’s very much in keeping with the global reputation we’ve built over the past 40 years of doing business the right way, right here in Panama.”

The Associated Press reported that Panama has a reputation for providing financial security for corrupt oligarchs, drug lords, and tax dodgers.

The Panama Papers have implicated many powerful individuals in a history of money laundering and tax evasion that stretches over 40 years. At least 140 people have been named as a result of these documents being leaked. The source of the Panama Papers wishes to remain anonymous and fears for their life. The ICIJ is still sifting through the documents and will release a full list of names and companies sometime in May 2016.

By Harrison Baker
Edited by Leigh Haugh

BBC: Panama Papers: Mossack Fonseca leak reveals elite’s tax havens
CNN: The Panama Papers: 7 things to know
CNN Money: The murky world of offshore tax havens
NPR: Fallout From Panama Papers Echoes Around The World
Image Courtesy of Pictures of Money’s Flickr Page – Creative Commons License

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