A massive leak of confidential documents from a Panamanian law firm shines a light on how elites across the world use offshore shell companies in order to hide their assets, in some cases facilitating corruption and money laundering.
Investigative journalists from fifteen countries in Latin America and the Caribbean — as well as Puerto Rico — helped the International Consortium of Investigative Journalists (ICIJ) examine documents they are calling the Panama Papers.
The documents leaked from Mossack Fonseca, a company that helps clients set up shell companies in tax havens like Panama and the British Virgin Islands, in order to hold their wealth under someone else’s identity.
Keeping assets in a shell company is not illegal, but it has become a way for those who’ve made money illegally — such as through corruption schemes or drug trafficking — to keep their funds secret.
Below are some of the most prominent figures in Latin America named in the document leaks.
Proceso reported that among the leaked Fonseca documents was evidence of how the Panamanian law firm helped Mexican drug traffickers keep their wealth in offshore shell companies. The firm’s most prominent client was Rafael Caro Quintero, a founder of the now-defunct Guadalajara Cartel. Mossack Fonseca created two shell companies for Caro Quintero in the 1980s, according to Proceso.
The firm also created a shell company for two people that the US Treasury Department blacklisted for alleged connections to the Jalisco Cartel, Proceso reported.
A noted media mogul and a businessman who’s received many favorable contracts with President Enrique Peña Nieto’s government — and was also a key player in the Peña Nieto “white house” scandal — also appear among Mossack Fonseca’s clients.
César Rosenthal, a member of the extremely wealthy and legally troubled Rosenthal clan, created an offshore company dedicated to purchasing aircraft via Mossack Fonseca. The company owned a plane that was seized and inspected in Guatemala as part of a drug trafficking operation. Three members of the Ronsenthal family — including ex-vice president Jaime — have been indicted in the US for money laundering and drug trafficking.
João Lyra, once Brazil’s richest member of Congress with an estimated worth of $140 million, appears in the Fonseca documents as linked to a Panamanian shell company.
Additionally, Idalécio de Oliveira, a key player in Brazil’s current Petrobras scandal, also appears in the Fonseca documents as linked to several offshore companies. The ICIJ reports that Oliveira cut a favorable business deal with Brazilian national oil company Petrobras, several years before the company came under investigation for running a massive corruption scheme. Brazil’s Attorney General’s Office has accused Oliveira of paying bribes to the former head of Brazil’s lower house of Congress in connection to the Petrobras probe.
One is Jorge Yoshiyama Tanaka, the nephew of the ex-minister of government under President Alberto Fujimori (1990-2000). Jorge Tanaka’s name appears as linked to an offshore company in the British Virgin Islands. He and his uncle donated about $61,100 to the presidential campaign of Keiko Fujimori in January 2016, while Tanaka’s wife donated about $60,800.
Mossack Foneca also helped José Lizier Corbetto register an offshore company in 2010, even though the law firm had previously included Lizier among its list of “blacklisted” clients in 2004. Lizier is known for helping smuggle Peru’s ex-head of intelligence Vladimiro Montesinos — once a powerful drug trafficker — out of the country in 2000.
The wife of Antonio Ibárcena Amico, another major political figure during President Alberto Fujimori’s era, also appears in the Fonseca documents. Ibárcena was the head of Peru’s naval intelligence and later the head of the marines. His wife and son have come under investigation for money laundering in Peru, while Ibárcena has been investigated for illicit enrichment.
César Almeyda Tasayco, a key political official for President Alejandro Toledo (2001-2006), also appears in the Fonseca papers as linked to an offshore company which Mossack Fonseca decided to stop representing in 2004. Almeyda was facing multiple corruption investigations at the time, including accusations that he’d held secret talks with a key witness in the Montesinos drug trafficking scandal.
According to El Faro, more than 220 offshore companies created by Mossack Fonseca worked with at least 33 Salvadoran clients between 2000 to 2015. The accounts were used to provide anonymity for real estate purchases and transfers of large funds of money, El Faro reported. The majority of the Salvadoran clients were lawyers who were hired to create the offshore companies, but eight clients sought Mossack Fonseca’s services without relying on a lawyer as an intermediary. Among these clients — whose identities will be revealed in subsequent stories published by El Faro, the website stated — is “a major businessman involved in politics,” a member of right-wing political party ARENA, and a businessman linked to left-wing party the FMLN.
Pedro Delgado, the cousin of current President Rafael Correa, has been charged with fraud in Ecuador and currently lives in the US. One of Mossack Fonseca’s banking clients helped Delgado and his wife secure a $190,000 mortgage in order to buy a house in Miami, according to the ICIJ.
Current Ecuador Attorney General Galo Chiriboga worked with Mossack Fonseca in order to create a shell company to buy a house for $2,800. The house owners later sued him and argued that the property was actually worth over $1 million.
As El Universo reported, another prominent Ecuadorian to appear in the Mossack Fonseca documents is Javier Molina Bonilla, who worked as an advisor to government spy agency the National Intelligence Secretariat from 2014 to 2015. He helped set up a Mossack Fonseca office in Quito and appears as linked to nearly twenty offshore companies.
Carlos Gutiérrez Robayo, the brother-in-law of ex-Bogota mayor Gustavo Petro appears in the Mossack Fonseca documents as linked to at least 12 offshore companies, many of them involved in the cattle ranching and real estate sectors.
Víctor Cruz Weffer served as the commander of Venezuela’s armed forces in 2001, until he was dismissed following a corruption investigation in which he was accused of mishandling some $113 million in public funds. He is named as a shareholder in an offshore company registered in 2007, the same year he was formally charged with illicit enrichment and failing to disclose his financial assets.
Prior to serving as president of state oil firm Petroleum of Venezuela (Petróleos de Venezuela – PDVSA) from 2005 to 2008, Jesus Villanueva held other important posts in the company, including working as the company’s top auditor. The Treasury Department is currently investigating PDVSA for using shell companies and other methods in order to launder some $4 billion. Mossack Fonseca created a Panamanian company linked to Villanueva in 2009. Money was then moved from that company to a bank account in Switzerland
Armando.info reported that a former bodyguard of President Hugo Chávez appears in the Mossack Fonseca documents as the owner of several Panamanian companies and the holder of a Swiss bank account.
Daniel Muñoz, who served as ex-president Néstor Kirchner’s secretary before working as an aide to Cristina Férnandez de Kirchner, is linked to an offshore company in the British Virgin Islands, ICIJ reported. He was investigated for illicit enrichment in 2009, although the charges were later dropped.
Kirchner was not the only Argentine political leader to have associates appear in the Fonseca documents. Current President Mauricio Macri appears with several family members as directors of an offshore company based in the Bahamas. Additionally, the Buenos Aires finance minister under Macri, Néstor Grindetti, was linked to a Panamanian offshore company that transferred funds to a Swiss account.
About 70 Mossack Fonseca offshore companies linked to Chile remain active, Ciper reported, with about 200 created in total between 1970 and 2015.
One noted offshore company link involves business mogul Alfredo Ovalle Rodríguez. The Fonseca documents showed that he has power of attorney over a Panamanian offshore company, which was used to open multiple bank accounts and invest in Chile’s mining sector. Ovalle previously came under scrutiny in Chile for his links to ex-president Augusto Pinochet’s secret police force, as investigative news website Ciper reported.
Ciper reported that other notable Chileans to appear in the Fonseca documents include the 1989 presidential candidate and Pinochet’s former finance minister Hernán Büchi; noted leaders of the gambling industry, and a businessman who made millions in contracts with state water services.
Guatemala ranks sixth in the world in terms of nations with the biggest number of Mossack Fonseca clients — 33 clients, over 1,200 offshore companies, and 444 intermediaries, according to Univision.
Univision reported that Mossack Fonseca’s Guatemalan clients included a company headed by alleged drug trafficker Marllory Chacón, whom US authorities accuse of laundering at least $4 million of drug money in Panama between 2009 and 2010. Chacón — described by the US Treasury Department as Guatemala’s “most active money launderer” — also held accounts with one of Guatemala’s biggest banks, raising additional questions over lack of banking oversight in the country.
Riccardo Francolini appears as the holder of several offshore companies during the same time period that he served as the head of the state airport authority, then subsequently as the chairman of Panama’s state bank. He has been linked to a corruption scandal involving ex-President Ricardo Martinelli, although no charges have been filed against him.