Friday 28 October 2016

'Putinophobia', Cameron's father and Iceland protests mark offshore leak fallout

Christopher Hope and Michael Wilkinson

Published 05/04/2016 | 02:30

David Cameron: silent on father’s offshore dealings. REUTERS/Joshua Roberts
David Cameron: silent on father’s offshore dealings. REUTERS/Joshua Roberts
Russian president Vladimir Putin. REUTERS/Kirill Kudryavtsev/Pool/Files
Chinese president Xi Jinping
Ukrainian President Petro Poroshenko
Icelandic prime minister Sigmundur Gunnlaugsson

International leaders moved last night to distance themselves from links to a law firm that specialises in helping to hide assets in offshore funds.

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Russia's premier Vladimir Putin; China's president Xi Jinping; Ukraine's president Petro Poroshenko; Pakistan's prime minister Nawaz Sharif and Iceland's prime minister Sigmundur Gunnlaugsson have all been implicated in schemes revealed in the so-called Panama Papers.

British prime minister David Cameron was rocked by revelations that his late father used the services of Mossack Fonseca, the law firm at the centre of the leak, to set up offshore arrangements to help shield investments from the tax authorities.

However, Mr Cameron is refusing to say whether any of his family's money is still held offshore in a Caribbean tax haven. His late father Ian ran an offshore fund which avoided paying tax in Britain by hiring Bahamanian residents, including a bishop, to sign paperwork.

Ironically, Mr Cameron's family links to an offshore tax shelter re-emerged just as the British prime minister prepares to host and chair an anti-corruption summit of charities, non-governmental bodies and world leaders to encourage more tax transparency in London next month.

Ian Cameron's name was included in the more than 11 million leaked documents from the Panama-based law firm Mossack Fonseca.

Mr Putin's spokesman has dismissed suggestions that the Russian president is involved in an offshore account scheme as a smear likely motivated by "Putinophobia".

The documents alleged Mr Putin's friends, including a leading cellist, were engaged in an offshore scheme involving a law firm in Panama.

The president's spokesman Dmitry Peskov said there was nothing to implicate Mr Putin.

"I don't consider it possible to go into the details," he said, "mainly because there is nothing concrete and nothing new about Putin, and a lack of details."


Mr Peskov added that Sergei Rodulgin, a St Petersburg-based cellist allegedly involved in the offshore schemes, was a friend of Putin's but that the president "has very many friends".

Instead, Mr Peskov suggested, the publication was a smear campaign with Putin as its "main target," with the aim of overshadowing Russian military intervention in Syria and influencing the Russian political scene ahead of parliamentary elections in September and presidential elections in 2018.

A climate of "Putinophobia" means good news about Russia is suppressed, he added.

But in Russia, where the investigation was published by independent newspaper 'Novaya Gazeta', the scandal faced an effective coverage ban. Russian television on Monday morning made no mention of it.

Chinese President Xi Jinping's family also features in the revelations. Xi's brother-in-law Deng Jiagui and family members of at least eight current and former members of China's powerful Politburo Standing Committee have set up offshore companies.

Ukrainian president Petro Poroshenko defended his commitment to transparency after calls for an investigation into allegations he set up an offshore company to move his confectionery business, Roshen, to the British Virgin Islands in August 2014 during a peak in fighting between Ukraine and pro-Russian separatists.

In response, Poroshenko said he had handed over the management of his assets to consulting and law firms on taking office.

"I believe I might be the first top official in Ukraine who treats declaring of assets, paying taxes, conflict of interest issues seriously," he tweeted.

Iceland's prime minister is also facing calls for his resignation after documents linked him to an offshore company.

"I have not considered quitting because of this matter nor am I going to quit because of this matter," Sigmundur David Gunnlaugsson told parliament. "The government has had good results. Progress has been strong and it is important that the government can finish its work."

As he left the building, large protests were developing in the capital, Reykjavik, outside the parliament.

Mr Gunnlaugsson and his wife allegedly set up a company in the British Virgin Islands. He said he and his wife have paid all their taxes in full. Mr Gunnlaugsson also said there was nothing new in the information.


Tax authorities worldwide - including in Australia, France, India, New Zealand and Austria - have begun investigations into the information.

The Australian Tax Office said it was investigating more than 800 wealthy clients.

French president Francois Hollande said: "As the information emerges, investigations will be carried out, cases will be opened and trials will be held. These revelations are good news because they will increase tax revenues from those who commit fraud."

New Zealand's tax agency said it was working to obtain full details of any of its tax residents who may have been involved. And in Sweden, the authorities contacted its counterparts in Luxembourg requesting information relating to allegations that one of Scandinavia's biggest banks, helped some clients to set up accounts in offshore tax havens.

The Norwegian Tax Administration wants details on how one of its banks helped around 40 customers set up accounts in the Seychelles.

Irish Independent

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