Panamanian government has received 3 requests from countries, but not U.S.
Little action apparent on Capitol Hill, other than questions from a committee
The Obama administration announced plans in May, but nothing has come of them
Nearly three months after the revelations from the Panama Papers exposed politicians, drug cartels and the wealthy hiding millions behind offshore companies, the U.S. Justice Department has yet to ask its Panamanian counterpart for access to seized records.
The inaction raises questions about the response by Congress and the Obama administration to the unprecedented leak that rocked governments in Iceland, Pakistan and the United Kingdom and prompted investigations worldwide.
“The biggest financial scandal involving offshores is greeted with a yawn by U.S. law enforcement officials?” said Charles Intriago, a former federal prosecutor and money-laundering expert in Miami. “It doesn’t make any sense that a pot of evidentiary gold is going unpursued by the U.S. Department of Justice.”
In May 2007, during a global crackdown on offshore tax havens, an obscure nonprofit lobbying group in Northern Virginia sent a fundraising pitch to a law firm in one of the biggest tax havens in the world — Panama.
The Center for Freedom and Prosperity promised to persuade Congress, members of the George W. Bush administration and key policymakers to protect the players of the offshore world, where hundreds of thousands of shell companies had been created, often to hide money and evade taxes.
To reach out to American officials and fund its U.S. operations, the center said it needed an infusion of cash for an eight-month campaign: at least $247,000.
“We hope you can support this effort with a donation,” the center wrote in a document sent to Mossack Fonseca, the law firm at the heart of an international financial scandal known as the Panama Papers. The leak of more than 11.5 million documents, which came from inside the Panamanian law firm, has pulled back the curtain in recent months on secretive offshore tax havens and the people who use them to stash their money, including a rogues’ gallery of international criminals, money launderers and drug dealers.
The Panama-based law firm made infamous for the Panama Papers document leak that rocked the globe had created more than 2,800 companies in the British Virgin Islands and elsewhere for more than 2,400 U.S.-based clients, The New York Timesreported Monday.
The April leak of more than 11.5 million financial and legal records and personal documents came from the firm Mossack Fonseca, which helps the world’s rich and powerful protect — or hide — financial assets and dealings.
Many of the transactions unveiled in the leak are legal. The Times, however, reports that “for many of its American clients, Mossack Fonseca offered a how-to guide of sorts on skirting or evading United States tax and financial disclosure laws.”
Over the years, William R. Ponsoldt had earned tens of millions of dollars building a string of successful companies. He had renovated apartment buildings in the New York City area. Bred Arabian horses. Run a yacht club in the Bahamas, a rock quarry in Michigan, an auto-parts company in Canada, even a multibillion-dollar hedge fund.
Now, as he neared retirement, Mr. Ponsoldt, of Jensen Beach, Fla., had a special request for Mossack Fonseca, a Panama-based law firm well placed in the world of offshore finance: How could he confidentially shift his money into overseas bank accounts and use them to buy real estate and move funds to his children?
“He is the manager of one of the richest hedge funds in the world,” a lawyer at Mossack Fonseca wrote when the firm was introduced to Mr. Ponsoldt in 2004. “Primary objective is to maintain the utmost confidentiality and ideally to open bank accounts without disclosing his name as a private person.”
In summary, the firm explained: “He needs asset protection schemes, which we are trying to sell him.”
Thus began a relationship that would last at least through 2015 as Mossack Fonseca managed eight shell companies and a foundation on the family’s behalf, moving at least $134 million through seven banks in six countries — little of which could be traced directly to Mr. Ponsoldt or his children.
These transactions and others like them for a stable of wealthy clients from the United States are outlined in extraordinary detail in the trove of internal Mossack Fonseca documents known as the Panama Papers. The materials were obtained by the German newspaper Süddeutsche Zeitungand the International Consortium of Investigative Journalists, and have now been shared with The New York Times.
Mossack Fonseca — the shadowy law firm behind the Panama Papers leaks — has announced plans to close its offices in the British-dependent territories of Jersey and the Isle of Man, and the British overseas territory of Gibraltar, which sits at the southern end of the Iberian peninsula.
All three islands are self-governing and have their own legal and financial systems. What makes them attractive to a law firm like Mossack Fonseca and their clients is that all three islands are tax havens, where companies are exempt from corporation or income taxes, and where strict financial privacy laws mean a wealthy oligarch can hide millions in shell companies and nobody ever has to know who the money belongs to.
According to Boston Consulting Group’s 2012 global wealth report, UK-dependants like Jersey and Isle of Man are incredibly rich — yachts, diamond shops, champagne bars — you name it. Jersey has embraced people looking to hide their money with open arms for decades.
Panama law firm’s U.S. arm resigns from Nevada companies and loses its partner in Wyoming amid continued global scrutiny
Panamanian law firm Mossack Fonseca’s local affiliate in Nevada has resigned from more than 1,000 companies and paid a penalty to the state, while the law firm has also announced the closure of three of its international offices as the fallout from the Panama Papers investigation continues.
Nevada’s Secretary of State Barbara Cegavske announced in a statement on Monday that M.F. Corporate Services (Nevada), Mossack Fonseca’s local affiliate, had paid a $10,000 fine for failing to keep the required records and contact details for its clients. The penalty is the maximum allowed under the state’s laws.
Cegavske’s statement also revealed that the firm had abruptly resigned as registered agent from the 1,024 companies it administered in the state, a move that one expert told ICIJ partner McClatchy was “absolutely unusual.”
Two secretary of state audits found contact information missing
M.F. Corporate Services resigns as agent for 1,024 entities
Nevada company tied to a corruption probe in Brazil
The company at the heart of the Panama Papers scandal has resigned abruptly as the representative of 1,024 companies it administered in the state of Nevada.
The resignation by the Nevada affiliate of Mossack Fonseca came more than a month after a report by McClatchy that showed how the firm helped Brazilians, Russians and others camouflage assets from authorities in their home countries.
After two investigations in April, the office of Nevada Secretary of State Barbara Cegavske fined the firm $10,000 on May 20, the maximum allowed under Nevada law.
M.F. Corporate Services (Nevada) Limited’s decision to step away from its registered agent role for 1,024 companies was announced Monday on the secretary of state’s website.
In an interview, Nevada Deputy Secretary of State Gail Anderson said M.F. Corporate Services (Nevada) failed to maintain a name and address of a contact person for all of the shell companies it administered in the state.
“There was an initial visit to the office with a sampling of records, things identified, and under Nevada law they had 10 days to make corrections,” said Anderson.
Thomas Pickering had disclosed his involvement with Luxoft
‘I’ve been very careful in my dealings with the boards,’ Pickering says
He still serves on the Foreign Affairs Policy Board
As Russian software company Luxoft prepared to offer shares on the U.S. stock market, its executives turned to a well-known U.S. diplomat.
Thomas Pickering, a former U.S. ambassador to Russia who also served as undersecretary of state for political affairs under President Bill Clinton, agreed in May 2013 to be a director of Luxoft Holding Inc. a month before the company’s debut on the New York Stock Exchange.
The relationship between Luxoft and Pickering, whose diplomatic career spans six presidents and four decades, is detailed in the massive Panama Papers leak and comes amid a global debate over the role of offshore companies. Luxoft is incorporated in the British Virgin Islands.
Pickering is the highest-level former U.S. official to be identified as involved in a Panama Papers offshore company so far. The papers, which were leaked from the Panama law firm Mossack Fonseca to an international group of reporters, including the International Consortium of Investigative Journalists and McClatchy, have already revealed that former and current world leaders had offshore companies and have led to criminal inquiries around the globe, including in the United States.
However, nothing appears illegal or unethical about Pickering’s role, experts said. Pickering said in an interview that he had disclosed his role on Luxoft’s board to the State Department as required under government ethics rules.
And yes, Panama Papers hit the state of California…
— Among the CA entities, companies that pop up: San Francisco-Silicon Valley International Investment Group; Silicon Valley Microsystems SA, California Institute of Biotechnology. Link to California findings: http://bit.ly/1SZjwcn