Panama Papers. A secret information bomb of grandiose extent that exploded and whose impact continues to expand at this time on all continents. 11.5 million highly classified documents, amounting to a total of 2.6 terabytes, all of them leaked out of the internal affairs of Panama-based company Mossack Fonseca since as early as the 70s, including detailed information on over 214,000 offshore companies, including the identities of certain shareholders and managers, were all revealed to the public. Some of the world’s richest and most influential people, seen not so long ago as respectable public figures and even role models of all fields, from politics to sports, are shaking and fumbling to find a way out after the set of files arrived to the German publication Suddeutsche Zeitung, in 2015, and afterwards to the International Consortium of Investigative Journalists (ICIJ). About 400 journalists of 107 media organisations received the information mentioned above, and the first article based on this data, along with 149 documents, was published on April 3, 2016. And this is only the beginning. The following ones will certainly shatter the world as this information leak is among the greatest in history, exceeding the 2013 case of WikiLeaks.
Jurgen Mossack and Ramon Fonseca started in 1977 the company that would later become the fourth greatest supplier of offshore services worldwide. Its services include founding companies – in offshore jurisdictions such as the Virgin Islands, Cyprus or Switzerland – and managing them for an annual tax. It is actually a global network of impressive extent, with hundreds of employees working in several dozens of countries and franchises working on their own. Their customers are hundreds of thousands of people of great wealth and influence, as well as organisations seeking one simple purpose, practised ever since ancient times: to hide their wealth and not be forced to provide explanations to anyone for their money. Thus, the richest people of the world got away from taxes and even laundered money considering that they will never get caught. It seems, nonetheless, that the balloon got a little bit too inflated and someone orchestrated a massive show down by means of the press. A mysterious source started an enormous avalanche.
Among the customers of the Mossack Fonseca company, there are, directly or indirectly, at least 72 former and present state leaders of the last 40 years. There are the former dictators of Libya and Egypt, Muammar Gaddafi and Hosni Mubarak, Syrian President Bashar Al-Assad, as well as Mohammed VI of Morocco. Moreover, the names of Chinese President Xi Jinping of Ukrainian state leader Petro Poroshenko, as well as that of British Premier David Cameron’s father are to be found in the 2.6 terabytes of data, as well as that of Vladimir Putin’s close friend, cellist Sergei Roldugin, who allegedly benefited of payments of USD 2 billion, through seven offshore companies and two great Russian banks. Other persons in the Russian President’s entourage are targeted as well. ICIJ journalists tracked the way Russian President Vladimir Putin’s business partners hid millions of USD in banks and dummy corporations. There are dozens of transactions leading to a total of at least 2 billion USD, discovered in the Mossack Fonseca archive, involving persons or companies linked to Putin. Classified documents suggest that a great part of the loans initially came from a bank in Cyprus that, at the respective time, was owned in majority by VTB Bank, controlled by Kremlin and affected by international embargo due to Russia’s attack on Ukraine.
Also, North Korean front company used to help fund the country’s nuclear weapons programme was among the clients of the Panamanian law firm at the centre of a massive data leak
Moreover, the documents also target actors and sports personalities such as Jackie Chan, Bollywood superstar Aishwarya Rai Bachchan, Michel Platini and Lionel Messi, already investigated in Spain for tax evasion. In Iceland, documents reveal that Prime Minister David Gunnlaugsson and his wife have secretly owned an offshore company that had invested millions of dollars in bonds, while their country was battling financial crisis.
Documents also expose offshore companies controlled by the King of Saudi Arabia or by the President of Azerbaidjan’s children. Moreover, they shatter FIFA as well, by revealing that the law office owned by Juan Pedro Damiani, a member of the FIFA ethics committee, has had business relations with people involved in the FIFA controversy, more precisely with former Vice-President Eugenio Figueredo, who had allegedly received bribe for granting broadcasting rights to certain TV stations. Documents show that Damiani’s law office in Uruguay had represented an offshore company linked to Hugo and Mariano Jinkis, father and son, accused of having paid a bribe in order to be granted TV broadcasting rights for football events in Latin America. Damiani represents seven more companies connected to Figueredo, according to RISE Project, the partner for Romania of the global investigative project #PanamaPapers.
The documents also include at least 33 persons and companies found “on the black list of the US Government, accused, among other things, of business connections to Mexican drug cartels to terrorist organisations such as Hezbollah or to oppressive regimes such as North Korea and Iran”, the journalists of Rise Project reported, adding that “one of these companies has supplied fuel for the aircrafts used by the Syrian Government to bomb its own citizens.”
It goes without saying that the law company Mossack Fonseca of Panama has labeled the publishing of these classified documents as an offence and an attack against the state of Panama. “We, lawyers, found companies, we build them, just like a car factory builds cars, and we sell them. We are not responsible for what that company does. It is just like a car factory was accused in case of an accident or for the fact that the car was used for theft”, Fonseca Mora, representative of the company Mossack Fonseca declared. This is how the company pleaded its innocence three weeks ago, while being mentioned in the Brazilian corruption scandal that involved former President Ignacio Lula da Silva. According to national laws and international deals, companies such as Mossack Fonseca, providing help for creating companies and bank accounts, should grant a higher level of attention to customers that could be involved in money laundering, tax evasion and other crimes. The Government of Panama promised they would work by the side of justice in case an inquiry is initiated.
Romania is targeted as well in Panama Papers. Among the names of influential personalities who allegedly benefited of the services of the company Mossack Fonseca, there are a few controversial Romanian businesspersons: Cristian Borcea, Sorin Ovidiu Vintu, Vasile Frank Timis and Said Baaklini, a Lebanese businessman established in Romania. These people, similarly to all the other ones involved in the tremendous scandal, have allegedly founded dummy corporations helped by the lawyers of Panama in Seychelles, the British Virgin Islands, Bahamas, Niue and other non-transparent jurisdictions of low tax policies, and have exploited various “fertile fields” for years in a row, drastically influencing local economy and then exporting the profit to tax havens. The beneficiaries of these great businesses were kept confidential for dozens of years. So far.
“The database of the company Mossack Fonseca shows, among other things, the identity of the unknown millionaire in the leading structure of the Rafo Onesti Refinery (Beny Steinmetz, author’s note) and his connections to the gold layers of Rosia Montana. Vasile Frank Timis, initiator of the Rosia Montana business, allegedly used the same lawyers of Panama City to start business in Romania by the mid-90s. In the Panama papers, as well, we find the offshore subsidiary that controls another important gold mine of Apuseni Mountains, as well as other companies active in oil and gas exploitation. Vasile Frank Timis has used the company Castle Europa Limited, founded in Bahamas by lawyers of Mossack Fonseca in the business he started in Romania, in 1997”, RISE Project shows.
“Documents also list key people in the privatisation of Alro, a deal presently investigated by Anti-corruption prosecutors, and shows how they changed their business field by focusing on other minerals and gas”, RISE Project further reported.
According to journalists making tremendous effort to manage the countless gigabytes of data, there are over 100 names of Romanian citizens in these documents, some of them belonging to well known Romanian citizens who have had a great impact on Romania’s economy. These names are soon to be revealed. And, on the background of street riots that already appeared in various corners of the world as a result of Panama Papers disclosures and taking into account the data anticipated to strike a blow in the very heart of Romanian society, the first institution in the country has already issued a reaction. Albeit a weak one for now. Thus, the Head of DIICOT has declared for Digi24 that his prosecutors are analysing documents presented in the press to see whether they are referring to ongoing or completed investigations. Nonetheless, Horodniceanu was keen to point out that the analysis should be performed by the Office for Money Laundering. It seems though that the Tax Office is also reacting. According to a press release, ANAF initiated an inter-department work group for checking tax implications of this information. This group will include anti-fraud inspectors, tax inspectors and inspectors specialized in checking the income of physical persons, the management of tax information and forced executions. PM Dacian Ciolos has declared on this matter that ANAF employees do not need special instructions concerning Panama Papers. And yet, although an increasing number of people are waiting for a reaction from behalf of DNA, the institution failed to give any signs of far that it would notify itself on the disclosures meant to explain how some of Romania’s richest people earned their wealth, although their faces are undoubtedly on prosecutors’ ‘Most Wanted’ panel.
But who is the mysterious source that made the leak of the 11.5 million highly classified documents possible? This is a question that will obviously remain forever unanswered. Because such information is only exposed when it needs to be. Journalists are aware of such things. Plenty of “journalists’ investigations” are actually opportunities, envelopes and mails arrived at the publication office with a dedication, some of them from intelligence offices that sometimes provide all required information to publish an article.
Therefore, the question is not who blew up such an information bomb. It is: why now? There are voices claiming that, actually, this story was well orchestrated with one purpose: Putin’s head. It is yet to be seen. The avalanche will go on.