Huge leak reveals deep corruption linked to offshore accounts

Israeli banks and citizens are among those implicated.

By REUTERS, JPOST.COM STAFF
April 4, 2016 00:06
2 minute read.
Russian President Vladimir Putin

Russian President Vladimir Putin . (photo credit: REUTERS)

An international effort by over 100 media organizations to expose the illicit financial activities of some of the world's most prominent individuals and organizations created waves on Sunday evening, as the effects of the 11.5 million leaked documents from a relatively unknown Panamanian law firm began to ripple around the world.

German newspaper Suddeutsche Zeitung said it received a cache of 11.5 million leaked documents from the law firm's database, and shared them with more than 100 other international news outlets as well as the International Consortium of Investigative Journalists (ICIJ).

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The files reveal the offshore holdings 140 politicians from around the world, including 11 heads of state. The effects of the financial activities are allegedly aimed at illegal activity such as tax fraud, money laundering and sanctions evasion.

Ramon Fonseca, the director of the Panama-based law firm Mossack Fonseca, specialized in setting up offshore companies, said in a telephone interview with Reuters that his firm had suffered a successful but "limited" hack.

Fonseca, the firm's co-founder and until March a senior government official in Panama, said his firm has formed more than 240,000 companies, adding that the "vast majority" have been used for "legitimate purposes."

According to the "Panama Papers" website, more than 214,000 offshore entities appear in the leak, connected to people in more than 200 countries and territories. Haaretz reported on Sunday that Israeli banks and citizens are among those implicated.

The ICIJ report published on Sunday details billions of dollars of shadowy financial transactions moved through numerous offshore accounts.

Britains Guardian newspaper said the documents showed a network of secret offshore deals and loans worth $2 billion led to close friends of Russian President Vladimir Putin. Reuters couldn't independently confirm those details.

Fonseca emphasized that the firm is not responsible for the activities of the companies it incorporates.

"We're dedicated to making legal structures which we sell to intermediaries such as banks, lawyers, accountants and trusts, and they have their end-customers that we don't know," said Fonseca.

He said that all of the firm's clients have been notified of "this problem," arguing that the firm has been caught up in an international anti-privacy campaign.

"We believe there's an international campaign against privacy. Privacy is a sacred human right (but) there are people in the world who do not understand that and we definitely believe in privacy and will continue working so that legal privacy can work," he said.

The law firm said in a separate statement published by the Guardian: "It appears that you have had unauthorized access to proprietary documents and information taken from our company and have presented and interpreted them out of context."

Panama's government said in a statement on Sunday that it will cooperate with any eventual judicial proceeding relating to the allegations in the report.


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