Over a year-and-a-half after the Panama Papers leaks, another financial data leak by the International Consortium of Investigative Journalists (ICIJ) has bared the secret offshore activities of some of the world’s most powerful people and companies.
The Paradise Papers – 13.4 million leaked documents – have exposed the high and mighty who conduct businesses in known tax havens in order to avoid paying taxes.
If last year’s Panama Papers cost leaders in Iceland and Pakistan their jobs, the Paradise Papers have turned the heat on 13 members of the Trump cabinet, including Secretary of State Rex Tillerson and Commerce Secretary Wilbur Louis Ross Jr, who have been named in the leaks.
Headlining the leaks are also Queen Elizabeth II of Britain, Queen Noor of Jordan, former Canadian prime ministers Jean Chretien, Paul Martin and Brian Mulroney and pop stars Madonna and Bono of U2.
The current trove of data comes largely from the Bermuda-based law firm Appleby. The firm has been in operation for a good 119 years and has been favoured by the super-rich and big corporations.
The ICIJ worked with 95 media partners globally for the investigation after the files were obtained by the German newspaper Suddeutsche Zeitung.Among the 180 countries represented in the data, India ranked 19th in terms of number of names.
The leaks have reportedly thrown up more than 700 Indian names, including those of politicians, corporates and celebrities.
Regulatory and enforcement agencies have promised a multi-agency probe even as those named denied any wrongdoing.
Bollywood superstar Amitabh Bachchan, businessman Vijay Mallya, wanted in India for financial irregularities and currently in Britain, corporate lobbyist Niira Radia, film star Sanjay Dutt’s wife Dilnashin, Union minister Jayant Sinha and Rajya Sabha MP R K Sinha figure in the list prepared by ICIJ.
India’s principal opposition Congress party turned the heat on the Narendra Modi government, alleging that it has “betrayed the people of the country with zero action against Indians’ black money stashed overseas,” the Statesman reported.
Attacking the Modi government’s “abysmal” track record on curbing black money, the Congress’s chief spokesman Randeep Surjewala said: “No FIR has been registered in the (2016) ‘Panama Papers’ expose and now 714 Indian links of the ‘Paradise Papers’ have revealed new tax havens.”
He said even 41 months after coming to power, Prime Minister Modi has allegedly “not taken any action against black money.” Surjewala demanded that the government should immediately order investigations into the Paradise Papers expose and bring to book the wrongdoers.
On its part, the BJP appeared in a quandary as the names of Jayant Sinha and R K Sinha appeared in the Paradise Papers. Jayant Sinha was quick to refute the allegation, saying he no longer had any links with the foreign companies named in the Paradise Papers. R K Sinha, however, kept mum over the allegations against him.
The most prominent Pakistani name that emerged from the leaks is that of Shaukat Aziz, the Musharraf-era finance minister who also served as prime minister during 2004-2007, leading newspaper Dawn reported.
Aziz worked for Citibank before entering politics and was “one of the shareholders and directors of the Bahamas-registered Cititrust Limited from 1997 to 1999, along with other executives of the bank.”
“Shaukat Aziz set up the Antarctic Trust in the name of his wife, three children and granddaughter weeks before he came to Pakistan to lead the finance ministry,” ICIJ representative Umar Cheema told Geo News, adding these assets were never declared to any Pakistani institution in financial documents Aziz submitted between 2003 and 2006.
Authorities in Indonesia are already looking at the names which have surfaced – they include former army general and opposition coalition leader Prabowo Subianto, as well as scions of former president Suharto, Tommy and Mamiek, the Straits Times reported.
“We will try to obtain more comprehensive and detailed data as part of efforts to ensure taxpayer compliance,” said Hestu Yoga Saksama, spokesman for the Directorate General of Taxation.
Dian Ediana Eae, deputy chief of Indonesia’s anti-money laundering agency, the Financial Transaction Report and Analysis Centre, confirmed that the agency is looking into the accounts and fund movements of the people identified in the leaks.
Information on Tommy Suharto and his sister, Mamiek, indicated the companies they were linked to in Bermuda were closed after a few years. Similarly, Prabowo’s Nusantara Energy Resources, established on the British island territory in 2001, was closed by 2004, according to Appleby’s records.
Fadli Zon, deputy chairman of Prabowo’s Gerindra Party, denied that the firm was set up to avoid taxes and said that it had not been active since it was founded. “This is a one-dollar company,” he told Tempo magazine.
Other familiar names in politics, business and even entertainment from Hong Kong, India, Japan and Malaysia were flagged by the ICIJ, which has promised to release more details of illicit transactions, involving cross-border transfers of trillions of dollars, in the weeks ahead.
The leak of 1.4TB of data from two offshore service providers and 19 tax havens’ company registries makes the Paradise Papers the second-largest data dump after the Panama Papers last year, which involved 2.6TB of data.
In Japan, former prime minister Yukio Hatoyama and Masamitsu Naito, who served as state minister for internal affairs and communications, were among a handful of former Diet members said to have ties to tax havens in Bermuda and the Cayman Islands.
Responding to questions from the Asahi Shimbun yesterday, Naito said: “I was introduced to what was described as a valuable foreign investment opportunity. I did not know it was based in a tax haven.”
The cache of leaked information also was reported to contain confidential client emails, including one dated Aug 10, 2015, from Malaysian businessman Low Taek Jho’s lawyer, Demelza Hassani, to Appleby, inquiring about extradition laws in the Caymans and British Virgin Islands.
Low has been linked to alleged efforts to siphon billions of dollars from Malaysian state investor 1Malaysia Development Berhad, better known as 1MDB.
While offshore entities are typically legal, the secrecy they provide attracts money launderers, drug traffickers, kleptocrats and others, said the ICIJ in a report on Sunday.