A leak, bigger than that of Edward Snowden’s or US diplomatic cables of WikiLeaks in 2010, has revealed the names of some of the world’s most famous names as tax avoiders.
The leak is called Panama Papers and it exposes among others some of India’s most famous names – names that we admired and held in high esteem.
The Panama Papers are a set of 11.5 million documents, or 2.5 terabytes of information, which leaked out of law firm Mossack Fonseca. German daily Sueddeutsche Zeitung was the first to obtain the documents.
The papers contain detailed information of the people who hid billions of dollars offshore through Mossack Fonseca over the last 40 years – practically, from the day of the firm’s incorporation.
Founded by Jürgen Mossack and Ramón Fonseca, Mossack Fonseca’s headquarter is located in Panama City. Almost a year before this leak, Vice News had done a story on the same law firm’s shady dealings while describing Panama as a country “run by assholes for more than a century“. The company has 40 offices around the world. It is one of the world’s five largest law firms involved in ‘creating’ companies.
Mossack’s father was a Nazi in World War II, serving in Hitler’s Waffen-SS, according to the ICIJ. #PanamaPapershttps://t.co/0CCeI88vcb — Benazir Shah (@Benazir_Shah) April 4, 2016
Mossack’s father was a Nazi in World War II, serving in Hitler’s Waffen-SS, according to the ICIJ. #PanamaPapershttps://t.co/0CCeI88vcb
— Benazir Shah (@Benazir_Shah) April 4, 2016
This firm has created more than 240,000 companies since 1977. But it has also been accused of protecting the wealth of dictators who circumvent international sanctions.
A lot. Subsequent investigation by International Consortium of Investigative Journalists (ICIJ) show that around 140 political figures from around the world held hidden offshore dealings. There are names of renowned sportspersons, celebrities and businessmen and women.
Names of Pakistani Prime Minister Nawaz Sharif’s three children are among those exposed in the leak. AP/File
The papers also indicate that Mossack Fonseka may have helped the criminals of 1983 Heathrow Airport robbery guard their loot without fear of authorities. Robbers took away 7000 gold bars, diamonds and cash, leading it to be dubbed as ‘Crime of the Century’.
There is no clear information on that, but various reports have estimated that Vladimir Putin’s associates alone laundered around $2 billion.
Daughter of former Chinese premier Li Xiaolin, associates of Russian President Vladimir Putin, Lionel Messi (and his father), children of Pakistani PM Nawaz Sharif, Saudi King Salman, Ukarainian President Petro Poroshenko, father of British PM David Cameron.
The only player to win 5 Ballon d’Ors, Lionel Messi, his father, disgraced Michael Platini and others charged in FIFA scandal are in the list. AP
Names also include some global banks like HSBC, UBS, Credit Suisse, and Deutsche Bank, who worked with Mossack Fonseca in creating offshore accounts for the individuals.
An eight-month investigation into the Panama Papers leak by Indian Express reveals the names of 500 Indians, prominent of them are Amitabh Bachchan, AIshwarya Rai Bachchan and her family, India Bulls owner Sameer Gehlot and DLF CEO K.P. Singh.
Quite! Such wisdom! #panamapapers https://t.co/OchGaHwBCa — swati chaturvedi (@bainjal) April 4, 2016
Quite! Such wisdom! #panamapapers https://t.co/OchGaHwBCa
— swati chaturvedi (@bainjal) April 4, 2016
There are two politicians on the list: Shishir Bajoria from West Bengal and Anurag Kejriwal, the former chief of the Delhi unit of Loksatta Party. Then there are Gautam Adani’s elder brother Vinod Adani and late Mumbai underworld don Iqbal Mirchi.
The crime is opening of offshore companies by bypassing the strict guidelines against it issued by the RBI.
Before 2004, no resident India was allowed to take their money abroad. In 2004, the law was slightly altered to accommodate the transfer of upto $25,000 in a year for offshore expenditure. Now the amount stands at $2,50,000.
RBI allowed buying of shares in the 2004 ruling. In 2010 the RBI ruled that resident Indians cannot set up companies abroad but can invest in shares.
The names of both Amitabh Bachchan and his daughter-in-law Aishwarya Rai are among the 500 Indians on the list. Yahoo
In 2013 RBI allowed resident Indians to set-up overseas subsidiaries or invest in JVs. RBI also notified that those who set up companies before 2013 violated FEMA rules.
And that is the crime. The Indian Express investigation reveals that people incorporated offshore companies or acquired shares even before 2004.
By doing this the violators indulged in tax avoidance, as per commonly understood legal parlance. Mosseck Fonseca also helped in shrouding the names of these individuals under layers of secrecy.
One will have to see what action does the RBI, Income Tax department and the other economic enforcement agencies take following this massive leak of documents that exposes the big names from India.