BRAZIL CHARGES MEMBERS OF PANAMANIAN CORPORATE SERVICES FIRM WITH MONEY LAUNDERING
Mossack Fonseca headquarters in Panama
Representatives of the Panamanian law firm Mossack Fonseca has been charged in Brazil of money laundering and other financial crimes.
Two employees were arrested yesterday and three more are at large.
The arrests are linked to “Lava Jato” operation which has also resulted in the arrest of Odebrecht President Marcelo Odebrecht.
One of the Mossack employees who was arrested, María Mercedes Riaño, is accused of destroying and hiding documents.
An e-mail obtained by prosecutors indicates that she removed due diligence documents and client records from the office.
Mossack Fonseca issud a statement claiming that the employees are being wrongly charged and that the firm has no connection to the suspects in the Lava Jato investigation.
At a press conference yesterday, prosecutor Carlos Fernando dos Santos Lima said that there is evidence that Mossack and Fonseca was “a money-washing machine.”
According to the magazine veja.com, MF employees Ricardo Honorio Neto and Renata Pereira Brito were detained yesterday while María Mercedes Riaño, Ademir Auada and Luiz Fernando Hernandes are still at large and thought to be out of the country. All of them are employees of MF in Brazil, according to veja.com,
According to the Brazilian media, authorities also arrested Nelci Warken. He is the owner of real estate linked to the offshore company Murray Holding that was created by MF and allegedly used to launder money.
The Attorney General said that strong evidence that Warken was a “puppet” in the laundering scheme, as he lacks the means to afford the apartment or handle the large amounts of money linked to Murray Holding.
“He doesn’t even have the documents to travel abroad,” said the prosecutor.
According to investigations, the construction company OAS used the building linked to Murray, Solaris, where former President Luiz Ignacio Lula da Silva also has an apartment, to conceal bribes paid to officials with the state oil company Petrobras.
Petrobras executives are accused of receiving millions of dollars in bribes from several contractors, including Odebrecht, whose subsidiary in Panama is the largest recipient of state contracts. prime contractor for the state.
Veja.com said the latest development in the Lava Jato case came after it was discovered that the sister of João Vaccari Neto, former treasurer of the Workers Party, allegedly used money from bribes to buy an apartment in the Solaris building.
Vaccari’s wife, Giselda Rousie de Lima, also owns a unit in the building that is registered in the name of Murray Holdings.
Prosecutors have linked a number of companies created by MF to Ptrobras officials. These include Milzart Overseas Holdings, controlled by former Petrobras Director Renato Duque, and Backspin Management, Daydream Properties, Tropez Real Estate and Dole Tec, all linked to former Petrobras Manager Pedro Barusco. Another company, Mayana Trading Corp., is linked to businessman Mario Goes.
Barusco and Goes have cooperated with investigators in the probe.
Prosecutors have also linked at least eight offshore companies to Roberto Trombeta, who is also a target of the investigation. He allegedly receive bribes from Constructora OAS for works in Peru and Ecuador.
One company, Kingsfield, was allegedly used to process some $5.7 million in bribes between November 2012 and February 2013. Another $8 million was received by the company from a Swiss bank in the name of Alberto Youssef on orders from OAS.
Judge Sergio Moro said that there is evidence that “Mossack Fonseca provided services for the opening of offshore societies, and at least four agents were involved in a scheme to launder money.”
Brazilian authorities made the allegations based on e-mails sent by MF officials.
According to the e-mails, there were orders made to destroy crucial documents linking the firm to the creation of the documents, including messages sent by Riaño Quijano.
Sources said that Riaño Quijano is in Panama and was at the headquarters of MF yesterday.
BCKGROUND HERE …….
Why Panama Remains a Money Laundering Haven
There have been other troubling signs that it might not be so easy for Panama to shed its notoriety as a money laundering hub. Authorities recently awarded lucrative contracts to the Odebrecht Group, a scandal-plagued Brazilian conglomerate whose CEO is currently in prison on money laundering charges. One of the most influential members of President Juan Carlos Varela’s cabinet runs a law firm, Mossack Fonseca, which is reportedly one of the most prolific creators of shell companies in the world. The firm also has alleged ties to associates of Muammar Gaddafi, Robert Mugabe, and Bashar al-Assad (the former leader of Libya, the president of Zimbabwe, and the president of Syria, respectively) as well asthe recent FIFA scandal. Meanwhile, several real estate developers — which a leaked US Embassy cable linked to money laundering and other illicit activities — continue to operate in the country.
This Shady Law Firm Keeps Helping Banks and Oligarchs Launder Money
In mid February, the authorities in Geneva, Switzerland raided the offices of British multinational HSBC after a public prosecutor opened a criminal investigation into allegations that the bank, one of the world’s largest, had helped its clients launder money by hiding it in offshore accounts. Not long afterwards, German police raided the offices of Commerzbank, suspecting that it, too, was involved in money laundering.
Evidence gathered during the second raid implicated a third company, the Panamanian-based law firm Mossack Fonseca, in the criminal money laundering. As it happens, I last December, in a story titled “The Law Firm That Works with Oligarchs, Money Launderers, and Dictators.” And the evidence found during the raid on Commerzbank suggests that despite my story—and the small sliver of sunlight it shined on Mossack Fonseca’s dealings—the firm is still up to its old tricks.
Investigators believe that Mossack Fonseca helped set up offshore front companies linked directly to the accounts. It’s not yet clear from published reports whose money HSBC, Commerzbank, and Mossack Fonseca allegedly helped hide offshore, but the listreportedly includes several Israeli billionaires.
As I reported after an extensive investigation that included trips to Panama and Las Vegas—where Mossack Fonseca uses a closely-linked firm, MF Corporate Services, to help its clients set up bogus shell companies—the Panamanian law firm has a long list of shady prior clients.
They include Rami Makhlouf, the richest and most powerful businessman in Syria who is believed to be the “bagman” for President Bashar al Assad. That kinda speaks for itself.
Other clients of Mossack Fonseca’s include associates of Muammar Gaddafi and Robert Mugabe, as well as an Israeli billionaire who has plundered one of Africa’s poorest countries, and a business oligarch named Lázaro Báez. According to US court records and reports by a federal prosecutor in Argentina, Báez allegedly laundered tens of millions of dollars through a network of shell firms, some which Mossack Fonseca had helped register in Las Vegas.
Incidentally, the main employee of MF Corporate Services is Patricia Amunategui, a native Chilean who previously worked as a casino cocktail waitress and, based on her Facebook page, enjoys yoga, spiritualism, and hiking, and admires the Dalai Lama, the Tea Party, and former Chilean dictator Augusto Pinochet.
Another person who has helped set up Las Vegas shell companies for Mossack Fonseca is Leticia Montoya. She’s based in Panama and has previously registered or served as a nominee director for at least six anonymous companies that were involved in major international corruption scandals. Here is her passport photo.
Also, I mentioned HSBC above. Its CEO, Stewart Gulliver, was recently revealed by theGuardian to have controlled an offshore bank account in Panama. He has claimed that he only opened it because he didn’t want his colleagues to know about the enormous, swollen bonus he received from HSBC. It is not yet clear if Mossack Fonseca set up his account.
According to the Guardian, Gulliver was the “beneficial owner of an account in the name of Worcester Equities Inc, an anonymous company registered in Panama, containing a balance in 2007 of $7.6m. It was through this entity that Gulliver ‘s HSBC bonuses were paid until 2003. He also held a second account in the name of Worcester Foundation, which had been closed before 2007.” (See this article at Naked Capitalism, which very generously cited my earlier VICE story.)
What’s more, a US Senate committee report has described HSBC as a major conduit for “drug kingpins and rogue nations,” and in 2013 the bank signed a $1.92 billion settlement with the US Justice Department after admitting to helping launder millions of dollars through shell firms for Colombian and Mexican cartels.
(Credit where credit is due: The best, most groundbreaking work on money laundering and the offshore system has been done by the International Consortium of Investigative Journalists.)
The German and Swiss investigations are ongoing.
When I asked Mossack Fonseca for comment on these fresh investigations, the firm denied everything generally without denying anything specifically—though they essentially denied that Báez had ever been a client. The firm also bragged that it had never been criminally charged with wrongdoing, which seems like a pretty low bar, but that was its defense. And while it remains true, to the best of my knowledge, that the firm has not yet been charged with criminal conduct, that may soon change depending on the investigations in Switzerland and Germany.
Ana María Garzón, a communications advisor with Comunicaciones Corporativas— which is affiliated with PR firm Burson-Marsteller Panamá—sent an email on behalf of Mossack Fonseca wherein the firm stated that it is “inaccurate and ludicrous” to suggest that they are currently being investigated for criminal wrongdoing. Garzon, who is not a spokeswoman for Mossack Fonseca but whose firm is hired as an outside contractor to field media inquiries, also passed along word from her client that everything I have ever written about it is false, though the email failed to indicate what specifically was not true. Mossack Fonseca added that “all remarks made by publications such as Vice Magazine and others who have replicated the false accusations and fabrications are baseless and respond to vested interests.”
I’d like to take this email at face value, but I would also note that according to theGuardian, Burson-
But that’s just from a cursory search on the Internet, so who knows? When I asked Garzón about these allegations against Burson-Marsteller, with which her PR shop is affiliated, she had no comment. If she replies, I will be sure to update this story.
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