The Panama Papers – Intriguing for what remains hidden

 

!#$%!#$L

The Panama Papers – The Biggest Single non-Governmental Document Leak in History and a Financial Nightmare for the Tax Savvy and Ethically Challenged

Lost Messiah, June 28, 2016 

When LM was first provided information regarding the Panama Papers and the connection it might have to Jona Rechnitz, Jeremy Reichberg, the Platinum funds and Lev Leviev, we were also provided links to Leviev’s sons. Moshe and Shmuel Leviev who were, according to the original information we were provided, directly connected to the database. For obvious reasons, we found that odd and did not want to publish anything until we could reasearch further. But, when we noticed that the original links for Shmuel and for Moshe Leviev are no longer available; our curiosity piqued. 

Despite the extent of the information available in that database and the breadth of the names, accounts, connections, emails, not only were the two sons’ information no longer available but hours of research did not uncover anything about Leviev’s ties to Platinum, to Reichberg and Rechnitz, to Sam Pa or frankly or any other story that we have been working on or that has been in the news, though Leviev was not scrubbed from the database completely. 

!#$%!#$SWhile there are dozens of possible explanations (see NY Times take below), not the least of which being that the database does not cover every single company the world over; the complete absence of information on the original links to Leviev’s sons is striking; and the lack of mention of companies which may or may not be related to entities in that database is in our view somewhat suspect.

While the NY Times articles cited below suggests that the lack of US company presence in the database may be the result of the ease with which US companies can set up unidentifiable and untraceable shell companies, we find that answer to be problematic for two reasons. The first, if the US makes it that easy to potentially break laws then perhaps the US needs to tighten up its corporate legal framework. We do note that there is no direct evidence that all of the companies listed have broken laws.  The second relates to the many tentacles the companies mentioned in our articles and articles from US news sources have to foreign entities. From our perspective, there is some indication that what is not in that database may be intentionally absent.

!#$%!#$MWe have provided links to the ICIJ mentioned below. For any curious investigators or investigative journalists among our readers, if you find something we did not, please kindly send along.  

Background – THE PANAMA PAPERS

For those of you who do not know, the Panama Papers is the name given a massive “leak of 11.5m files from the database of Mossack Fonseca, a Panama-based law firm, [which shows] a bright light on the world of offshore tax planning. In addition to its headquarters in Panama, the firm employed 600 people in 42 countries and was the world’s fourth-biggest offshore law firm.” 

Mossack Fonseca data seen by the Guardian covered more than 200,000 companies for which the firm acted as registered agent. The British Virgin Islands held more than 100,000 companies.

“More than half of the companies were established in the British Virgin Islands. Why don’t call it BVI papers? Or the British Commonwealth papers? We take the issue with the fact that it was called the Panama Papers. Call them Mossack Fonseca papers. I don’t care,” he said.

Mossack Fonseca remains under investigation in the British Virgin Islands.

https://www.theguardian.com/world/2016/jun/27/panama-papers-canal-mossack-fonseca

The reality of the Panama Papers is that they have very little to do with Panama and a lot to do with companies whose ownership and other corporate connections are unknown and have used that lack of transparency to hide money. 

The data, part of the Panama Papers investigation, is the largest ever release of information about offshore companies and the people behind them. This includes, when available, the names of the real owners of those opaque structures.

The database also displays information about more than 100,000 additional offshore entities ICIJ had already disclosed in its 2013 Offshore Leaks investigation.

https://panamapapers.icij.org/blog/20160509-offshore-database-release.html

The data was originally obtained from an anonymous source by reporters at the German newspaper Süeddeustche Zeitung, who asked ICIJ to organize a global reporting collaboration to analyze the files.

https://panamapapers.icij.org/blog/20160509-offshore-database-release.html

The International Consortium of Investigative Journalists (ICIJ) decided to publish much of the database from the Panama Papers.

The searchable database that ICIJ publishes today allows users to explore the networks of companies and people that used – and sometimes abused – the secrecy of offshore locales with the help of Mossack Fonseca and other intermediaries. The leaked data covers nearly 40 years, from 1977 through the end of 2015.

The data, which includes postal addresses, displays links to more than 200 countries and territories, from China to Chile. Users can filter the information by country and by offshore jurisdiction. They can also explore the role of banks, law firms and other gatekeepers of the financial system in facilitating the creation of offshore companies for high net worth individuals. For the first time, they can see details about shadowy Panamanian private foundations, including when available information about who controls them.

https://panamapapers.icij.org/blog/20160509-offshore-database-release.html

Diamond Tycoons and the Panama Papers

The Panama Papers included information on numerous diamond merchants and holdings that are both secret (or were) and public. These included Israeli billionaire Dan Gertler, Yitzhak Abuhatzeira, “the son of David Abuhatzeira, formerly Nahariya’s chief rabbi. David Abuhatzeira is also the grandson of Rabbi Israel Abuhatzeira, known as the “Baba Sali”” who recently endorsed the Israeli ultra-Orthodox political party Shas. The Panama Papers included information on companies and their holdings, such as Mumi, jointly owned by Rowny and Glencore. They were comprised of information on Benny Steinmetz and Daniel Steinmetz, all diamond tycoons along with Lev Leviev.

The Israeli billionaire Dan Gertler, who made his fortune in diamonds and mining, is mentioned more than 200 times in the Panama Papers.

Gertler is among some 600 Israeli companies and 850 Israeli shareholders listed in the leaked documents of Panamanian law firm Mossack Fonseca, a leader in establishing shell companies that often serve to conceal the ownership of assets.

Gertler is mentioned in connection to a number of companies, and registered as a beneficiary for some of them. Mossack Fonseca’s internal correspondences includes a draft of a contract between Gertler and a company called Callery Resources, seemingly for consultation on a mining deal in Congo.

read more: http://www.haaretz.com/israel-news/1.713130

Gertler isn’t the only diamond merchant associated with companies that were registered by Mossack Fonseca. Lev Leviev, for example, is named in the files as the owner of Lexinter International Inc., which holds shares in Vauxhall Securities Inc., a company registered in the British Virgin Islands.

The extensive activities of diamond and mining tycoon Benny Steinmetz, his brother Daniel Steinmetz and their business partner Nir Livnat are mentioned in hundreds of Mossack Fonseca documents. Internal correspondences between the law firm and Diacore, part of Steinmetz’s diamond group BSGR, identify Construction Minister Yoav Galant as a confidant of Steinmetz.

In view of this, the law firm requested the company to provide “the pertinent explanations related to the information found.”

read more: http://www.haaretz.com/israel-news/1.713130

The New York Times take from April of 2016

The New York Times reported on the Panama Papers on April 4, 2016 in an article entitled, “The Panama Papers: Here’s What We Know.” Addressing our theory on the lack of information regarding the involvement of US companies and individuals, The New York Times suggested that because it is so easy to create shell companies in the US, Panama and other foreign jurisdictions are largely unnecessary so there may have been no reason to use  a Panamanian law firm or connected firm to create such entities. We don’t necessarily buy that conclusion because many of the companies we have investigated do have offshore entities or are deeply and inextricably connected to offshore entities.  

The Panama Papers have exposed how some of the world’s most powerful people may have used offshore bank accounts and shell companies to conceal their wealth or avoid taxes.

The papers — millions of leaked confidential documents from the Mossack Fonseca law firm in Panama — identify international politicians, business leaders and celebrities involved in webs of suspicious financial transactions. The revelations have raised questions about secrecy and corruption in the global financial system.

http://www.nytimes.com/2016/04/05/world/panama-papers-explainer.html

Were any Americans implicated?

It is not clear how many United States citizens may have been involved. So far, the documents cited in news reports have not connected any prominent American politicians or other influential Americans to Mossack Fonseca.

One reason may be that it is fairly easy to form opaque shell companies in the United States. Americans “really don’t need to go to Panama,” James Henry, an economist and senior adviser to the Tax Justice Network, told Fusion. “Basically, we have an onshore haven industry in the U.S. that is as secretive as anywhere.”

http://www.nytimes.com/2016/04/05/world/panama-papers-explainer.html

Related Coverage

Panama Papers Continue to Shake Leaders, Including Cameron and Putin APRIL 7, 2016
Panama Papers Leak Casts Light on a Law Firm Founded on Secrecy APRIL 6, 2016
Panama Papers Tie More of China’s Elite to Secret Accounts APRIL 6, 2016

Links to the Panama Papers:

https://panamapapers.icij.org/

 

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