Published On: Thu, Apr 7th, 2016

Panama law firm’s covert global sales network operated under the radar

panama-papers-mossfon-fonsecaMIAMI - It appears that Mossack Fonseca's public relations campaign, aimed at disseminating disinformation, and denying the Panama law firm's role in global tax evasion, money laundering, and global investment of criminal proceeds, is in high gear.

Mossack Fonseca partner Ramón Fonseca has claimed that the source of the information was a massive hack of the firm's database, when in truth and in fact it was Fonseca's mistreated, spurned mistress, a former employee, who was the primary source of the information.

The law firm has been totally silent about its off-the-books, cleverly disguised international network of salesmen, hawking the virtues of the firm's services.

None of the offshore services offered involved legal advice, merely tax dodges, wealth management of cash with no questions asked about source of funds, and investment of anyone's money, irrespective of their status as a government official, with ready access to public money.

While it is true that only attorneys and law firms can form corporations under Panamanian law, all this type of work is done by paralegal assistants, and the only advice proffered is a referral to the firm's wealth management and other subsidiaries, which will hide the client's proceeds of crime.

These are two examples of Mossack Fonseca’s opaque method of offering questionable, non-legal services to prospective clients overseas:

(1) Canadian investigators have uncovered a Vancouver corporation, ostensibly open for only one year, offering Mossack Fonseca services, a decade ago. Here's the twist: even though the company is allegedly closed, it is still listed as a Mossack Fonseca asset in some places, its telephone still works, and the Canadian attorney originally listed as the local manager has a long and dark history of involvement in suspect activities; he also maintains other vehicles for offshore work, not named as Mossack Fonseca subsidiaries. There was also a covert office in Toronto, located within a million-dollar condominium apartment in the city's financial district, operated by a "wealth manager”.

(2) Mossack Fonseca’s Miami, Florida, sales office is located in a luxury condominium apartment on pricey Brickell Avenue; however, there are no means of contacting it, nor the names of staff members. The registered agent is itself a corporation. It has no webpage, nor ascertainable email address. Exactly how are prospective clients to contact it? The answer is: don't call us, we'll call you. One seriously doubts that this covert sales office files any US tax returns.

Multiply these stories 120 times, as related by a Mossack Fonseca wealth management staff members, and you have a good idea of how this law firm pulls in dodgy clients, with dirty money.

Meanwhile, the finance minister of France, Michael Sapin, in a meeting of the National Assembly, has advised lawmakers that he intends to place Panama back on the French list of uncooperative tax havens. The grounds appear to be the earth-shattering disclosures popularly known as the Panama Papers, specifically the actions of the law firm of Mossack Fonseca in setting up offshore corporations for foreign nationals who were tax evaders.

Sapin also noted for those at the meeting that Panama has failed to follow through on its commitment to the OECD to share tax information with the countries of the European Union. The automatic tax information exchange has been proceeding in schedule at other offshore financial centres, but Panama has resisted orderly cooperation.

Some 515 Panama shell companies showed up in French criminal investigations in 2015, according to statements by the finance ministry, which has now opened a new investigation into aggravated tax evasion of it citizens, as the direct result of the Panama Papers scandal.

By Kenneth Rijock

Kenneth Rijock is a banking lawyer turned-career money launderer (10 years), turned-compliance officer specialising in enhanced due diligence, and a financial crime consultant who publishes a Financial Crime Blog. The Laundry Man, his autobiography, was published in the UK on 5 July 2012.

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