Panama to work ‘vigorously’ to investigate offshore accounts

Panama’s president said his government would cooperate “vigorously” with any judicial investigation arising from the leak of a vast trove of information on the offshore financial dealings of the world’s rich and famous.

A global coalition of media outlets known as the International Consortium of Investigative Journalists (ICIJ) on Sunday published investigations it said stemmed from the leak of 11.5 million records kept by the Panama-based law firm Mossack Fonseca on behalf of clients.

Juan Carlos Varela said in a statement that the revelations shouldn’t detract from his government’s “zero tolerance” for any illicit activities in Panama’s finance industry.

Ramon Fonseca, a co-founder of the law firm whose documents were leaked, told Panama’s Channel 2 that the firm wasn’t responsible for any criminal activity carried out with offshore vehicles created for clients.

The documents, from 214,000 entities, detail the offshore holdings of a dozen current and former world leaders, as well as businessmen, criminals, celebrities and sports stars.

Among the countries with past or present political figures named in the reports are Iceland, Ukraine, Pakistan, Saudi Arabia, Russia and Argentina.

Vladimir Putin’s spokesman claimed that the Russian president was the “main target” of the investigation, which he suggested was the result of “Putinophobia” and aimed at smearing the country in a parliamentary election year. The ICIJ has links to the US government, Dmitry Peskov suggested.

According to Haaretz, some 600 Israeli companies and 850 Israeli shareholders were also named in the leaked documents, including top attorney Dov Weisglass, former bureau chief of the late prime minister Ariel Sharon; Jacob Engel, a businessman active in the African mining industry; and Idan Ofer, a member of one of Israel’s wealthiest families.

The appearance of their names does not necessarily imply wrongdoing, only that they are linked to offshore companies mentioned in the documents.

Bank Leumi’s branch in Jersey in the Channel Islands, which provides a tax shelter to its customers, is also mentioned in the leak. It includes correspondence between the bank and the Panamanian law firm.

In October, Bank Leumi announced that it was closing the branch. This came after the bank, Israel’s second largest, paid $400 million in a settlement reached in December 2014 over an investigation into tax evasion schemes that involved American clients. The bank paid the US Department of Justice and the State of New York $270 million and $130 million respectively.

Last year, three former Bank Leumi executives were forced to repay the company a total of NIS 5.1 million (approximately $1.3 million) in the wake of the scandal.

According to Haaretz, the documents also show that Bank Hapoalim used the Panamanian law firm to manage activity for various trust funds until 2011.

Others mentioned in the leaks include Mohammad Mustafa, a senior financial official and confidant of Palestinian Authority President Mahmoud Abbas who used offshore accounts to funnel money from Arab states to the Palestinians, according to the documents.

The ICIJ says the trove of documents was reviewed by a team of more than 370 reporters from over 70 countries. The leaked papers date back to 1975 and provide what the ICIJ described as a “never-before-seen view inside the offshore world.”