A massive leak of millions of confidential documents from a Panamanian law firm has drawn back the curtain on the world of offshore tax evasion and money laundering, and allegedly includes a $2-billion money trail linked to associates of Russian President Vladimir Putin.
The dump of 11.5 million documents reportedly comes from a law firm called Mossack Fonseca, which has offices in Panama and 35 other countries and specializes in the creation of shell companies in tax havens around the world for the rich and powerful. The data are said to include e-mails and other documents dating back 40 years, detailing more than 200,000 shell companies.
The data were leaked to German newspaper Sueddeutsche Zeitung and analyzed by the International Consortium of Investigative Journalists (ICIJ), which has been involved in a series of similar data dumps on offshore tax evasion.
Over the past year, hundreds of reporters at an array of media outlets around the world, including Britain’s Guardian and the British Broadcasting Corp., combed through the records. According to the ICIJ’s website, its partners in Canada on the project were the Toronto Star and the Canadian Broadcasting Corp. The Globe and Mail has not seen the data.
According to the ICIJ’s website, the cache includes data on offshore companies allegedly linked to 12 current or former heads of state or government, their associates or their family members, including Mr. Putin; Chinese President Xi Jinping; the late father of British Prime Minister David Cameron; Ukrainian President Petro Poroshenko; and Icelandic Prime Minister Sigmundur David Gunnlaugsson.
Also mentioned is Argentinian soccer superstar Lionel Messi, who along with his father is facing tax evasion charges in Spain. According to Britain’s Mirror tabloid, Mr. Messi has already threatened to sue a Spanish newspaper over the latest revelations.
The law firm involved, Mossack Fonseca, has denied any wrongdoing. Simply setting up offshore entities is not illegal and companies, as well as rich individuals, often do so to take advantage of perfectly legal tax loopholes or for other legitimate purposes, often assisted by prestigious banks, law firms and accounting firms. But offshore entities can also be used to illegally evade taxes or to launder or hide money.
According to the ICIJ, the documents reveal a large network of trusts and offshore companies linked to Sergei Roldugin, a renowned Russian cellist and lifelong friend of Mr. Putin. This network of companies was allegedly involved in up to $2-billion (U.S.), in complex transactions.
The revelations sparked swift responses, even before being revealed on Sunday. A Kremlin spokesman has called them a misleading “information attack” on Mr. Putin.
Unknown hackers launched a “distributed denial of service attack” to try to shut down some websites that published stories on the data Sunday afternoon, according to the Twitter account of Drew Sullivan, the Sarajevo-based co-founder of the Organized Crime and Corruption Reporting Project, which was involved in analyzing the data.
JEFF GRAY
The Globe and Mail
Published Sunday, Apr. 03, 2016 9:02PM EDT
Last updated Monday, Apr. 04, 2016 6:23AM EDT