Panama Papers Reveals Shadowy Dealings of World’s Wealthiest

Dubbed as The Panama Papers a massive leak been in extremely confidential documents of a Panamanian law firm called Mossack Fonseca has thrown light for the first time ever on the financial affairs of some of the world’s wealthiest individuals.

Caught in the maelstrom are politicians like Iceland’s Prime Minister Sigmundur David Gunnlaugsson and Pakistan’s Prime Minister Nawaz Sharif, a large number of wealthy entrepreneurs and even celebrities like Lionel Messi and Jackie Chan.

The unprecedented leak of 11.5 million documents is made up of contracts, property deeds, emails, bank records, passport copies and other confidential documentation starting from 1977 onwards and goes until December 2015. Mossack Fonseca is one of the top companies that deals with providing a wide range of services to individuals looking to direct their money to tax havens, including setting up shell companies which is legal for law-abiding individuals.

The International Consortium of Investigative Journalists along with journalists from a number of media organizations across the world undertook a year-long investigation to uncover the details of the secret dealings of wealthy individuals, banks and law firms seeking to keep away assets from tax authorities.

BBC News

The leak has exposed the financial operations of a number of key public figures. Documents from the firm reveal that associates of Russian President Vladimir Putin covertly moved around close to $2 billion through a network of middlemen and shell companies. There are documents proving that Icelandic Prime Minister Sigmundur David Gunnlaugsson and his wife owned millions of dollars in Icelandic bonds through an offshore firm at the height of the country’s financial crisis.

Other notable revelations have been documents showing offshore companies linked to families of Chinese President Xi Jinping and Ukrainian President Petro Poroshenko. It also includes documents identifying companies controlled by Prime Minister of Pakistan and the King of Saudi Arabia along with other influential world leaders. A total of 29 billionaires out of the Fortune 500 list of richest people in the world have been identified as having had dealings with the firm.

The more worrying revelations have been that the customers of Mossack Fonseca include 33 companies and people blacklisted by the U.S. government, drug kingpins, Ponzi swindlers, tax evaders and a number of other individuals who have suspicious backgrounds.

In-depth analysis of the documents showed that over 500 banks, their branches and subsidiaries collaborated with Mossack Fonseca for decades to help set up and manage off-shore companies for their clients. In total there are around 14,000 institutions acting as middlemen, including banks, company incorporators, law firms who have worked with Mossack Fonseca to set up foundations, companies, and trusts.

While creating off-shore companies is not illegal, the documents reveal that these middlemen often failed to follow legal rules that required to ensure that their clients were not part of criminal enterprises or were involved in tax evasion or other illegalities.

Mossack Fonseca has denied these allegations by stating that these middlemen are its actual clients and not the individuals who eventually benefit from the offshore shell companies. The company has asserted that it follows all legal regulations.

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