Everything you need to know about the Panama Papers

Last year, it was Swiss Leaks, a global list with over 1,100 Indians with secret bank accounts in HSBC Geneva, which shaped the debate over black money parked overseas.

Now come The Panama Papers.

Many of us might have the question that what is Panama Papers and what is the buzz going around it.

So here’s what you need to about the Panama Papers.


What are the Panama papers?

On April 3, 2016, the International Consortium of Investigative Journalists (ICIJ) put out an in-depth, investigated and analysed report that blows the lid off tax evasion and secret offshore dealings of the powerful, rich and famous across the globe in 21 offshore jurisdictions such as Nevada, Niue, Samoa, British Anguilla, Hong Kong, Tortola, Seychelles and the British Virgin Islands. The 12 current and former heads of state from Iceland, Ukraine, Pakistan, Saudi Arabia, Russia and Argentina also figure on the list.  It also provides data on some 214,000 companies.

The whopping 11.5 million confidential Mossack Fonseca documents were leaked, revealing 2.6 terabytes of data, covering nearly 40 years of records.

“It allows a never-before-seen view inside the offshore world providing a day-to-day, decade-by-decade look at how dark money flows through the global financial system, breeding crime and stripping national treasuries of tax revenues,” the ICIJ said.


Why are they called the Panama Papers?

The more-than 11 million documents, which date back four decades, are allegedly connected to Panama law firm Mossack Fonseca. Mossack Fonesca is the world’s fourth biggest offshore law firm. ICIJ reports that the firm helped establish secret shell companies and offshore accounts for global power players. ICIJ reports that a 2015 audit found that Mossack Fonseca knew the identities of the real owners of just 204 of 14,086 companies it had incorporated in Seychelles, an Indian Ocean archipelago often described as a tax haven.
And as Gerard Ryle, the director of ICIJ, told CNN’s Christiane Amanpour: “These documents, if nothing else, raise an awful lot of questions.”

Why would anyone invest in a shell company?

It is not illegal to own a shell company. Usually, the world’s famous people who do not want to be seen as the real owners of assets prefer to invest in a shell company anonymously. However, that is not legal. Buying a shell company is a good source of stashing away money that you don’t want anyone to know– bankers, government, the taxman, and also your wife or husband. If the money is ill-gotten wealth, all the more reasons to invest in a shell company. A lawyer is a brilliant cover to buy a shell company, if you don’t want to do it yourself.

What is Mossack Fonseca saying?

On Monday, the firm released a statement:
“Our industry is not particularly well understood by the public, and unfortunately this series of articles will only serve to deepen that confusion. 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.
“Obviously, no one likes to have their property stolen, and we intend to do whatever we can to ensure the guilty parties are brought to justice.
“But in the meantime, our plan is to continue to serve our clients, stand behind our people, and support the local communities in which we have the privilege to work all over the world, just as we’ve done for nearly four decades.”
Firm co-founder Ramon Fonseca Mora told CNN earlier that the information published is false and full of inaccuracies and that parties “in many of the circumstances” cited by the ICIJ “are not and have never been clients of Mossack Fonseca.” The firm provided longer statements to ICIJ.

Who leaked information?

The story has the pulsating adrenalin rush of a James Bond film. The Munich-based daily Sueddeutsche Zeitun received 11.5 million data spanning a time-frame of 40 years (1997 to 2015) through an encrypted channel. Bastian Obermayer, a reporter of the daily,  says the whopping information was given gratis with a request for security in return.

After receiving the records of  214,488 offshore entities through emails, financial spreadsheets, passports and corporate records, the ICWJ put 370 journalists from across 80 countries on the job of tracing the hidden offshore assets of a roster of people in over 200 countries.


What are the consequences of this leak?

Ryle says the biggest consequence of the leak is the massive blow to secrecy — the biggest selling point of offshore tax havens.
“The offshore world really only has one product and that is secrecy and when you take away that product they don’t have anything for sale.
“For years and years they’ve been getting away with this secrecy and we’re also seeing in the documents that every time the governments and the authorities try to crack down, they’re finding new ways to get around those obstacles or barriers.”

What is the India link?

The Panama Papers have a few Indian names from business families, well-known lawyers and family members, Bollywood actors and also criminals.

  • Amitabh Bachchan
  • Aishwarya Rai-Bachchan
  • Kushal Pal Singh, DLF owner and 9 members of his family
  • Sameer Gehlaut, Chairman & Founder, Indiabulls Group
  • Vinod Adani, industrialist Gautam Adani’s elder brother
  • Shishir K Bajoria – promoter of SK Bajoria Group and politician from West Bengal
  • Anurag Kejriwal, former chief of the Delhi unit of Loksatta Party
  • Onkar Kanwar, chairman of Apollo Group
  • Anil Vasudeva Salgaocar , Goa-based mining baron and former MLA
  • Mohan Lal Lohia, chairman emeritus, Indo Rama Synthetics, Chairman – Indo Rama Holdings Ltd
  • (late) Indira Sivasailam, wife of Anantharamakrishnan Sivasailam, chairman of Amalgamations Group. Her daughter, Mallika Srinivasan – chairman and CEO of Tractors and Farm Equipment Ltd
  • Harish Salve, former Solicitor General of India (1999-2002)
  • Tabasum and Abdul Rashid Mir, Founder and CEO, Cottage Industries Exposition
  • Zavaray Poonawalla, head, managing committee, Royal Western India Turf Club (RWITC) and brother of Dr Cyrus Poonawalla
  • Rajendra Patil owns medical and engineering colleges in Davangere. He is the son-in-law of Congressman and Karnataka horticulture minister Shamanur Shivashankarapppa
  • Jehangir Soli Sorabjee, honorary consultant physician, at Bombay Hospital. He is the son of former attorney general Soli Sorabjee
  • Iqbal Mirchi, underworld don, now dead

Who is the global who’s who?

  • Mauricio Macri, President, Argentina
  • Vladimir Putin (to be fair, his name does not appear in the records) but his inner circle including his family and best friend and professional musician, Sergei Roldugin
  • Sigmundur Davíð Gunnlaugsson, Prime Minister, Iceland
  • Salman bin Abdulaziz bin Abdulrahman Al Saud, King of Saudi Arabia
  • Sheikh Khalifa bin Zayed bin Sultan Al Nahyan, president of the United Arab Emirates and emir of Abu Dhabi– one of the wealthiest man in the world
  • Pavlo Lazarenko, former PM of Ukraine, one of the world’s 10 most corrupt politicians by Transparency International,
  • Petro Poroshenko, President of Ukraine and billionaire ‘chocolate king

Fifa players

  • Lionel Messi and his father who was his agent
  • Michel Platini
  • Leonardo Ulloa, a top scorer for Leicester City
  • Gabriel Iván Heinze from Argentina who played with Manchester United and Real Madrid

Who are the other beneficiaries?

  • Li Xiaolin, the second child and only daughter of former Chinese Premier Li Peng
  • Ian Cameron, father of British Prime Minister David Cameron. He died on September 8, 2010
  • Mariam Safdar, daughter of Pakistan Prime Minister Nawaz Sharif and his sons Hasan and Hussain
  • Alaa Mubarak,  a wealthy Egyptian businessman, is the eldest son of ousted former Egyptian President Hosni Mubarak
  • Mounir Majidi, a businessman and entrepreneur, who was the personal secretary to the King Mohammed VI of Morocco, in 2000.
  • Clive Khulubuse Zuma, nephew of South Africa’s president Jacob Zuma.

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