Panama Papers: Vladimir Putin, Jackie Chan Linked To Questionable Offshore Accounts

Panama Papers: Vladimir Putin, Jackie Chan Linked To Questionable Offshore Accounts
Paperwork Mixup Robert Couse-Baker / Flickr CC BY 2.0
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What's This?

On Sunday, news about a Panamanian firm that provides offshore services to thousands of companies shook the world and spread around the Internet like wildfire. The scandal contained in the Panama Papers is by far the biggest economic scandal in terms of global magnitude.


According to a report from one of Germany’s biggest and leading newspapers, Süddeutsche Zeitung (SZ), the Panamanian firm was identified as Mossack Fonseca, named after its founders Jurgen Mossack and Ramon Fonseca. The newspaper noted that the offshore firm has catered to over 200,000 companies, trusts, and foundations since it opened for business.

The Clients

Some of its clients are powerful world leaders, prominent showbiz personalities, billionaires, and even executives from the Vatican. The 2.6 terabytes of data revealed clients that are closely related to Russian President Vladimir Putin. These clients reportedly moved $2 billion via shell companies, mostly financial institutions.

Clients who have established close ties to Chinese leader Xi Jinping were also identified in the leaked documents. Hollywood and even international celebrities such as Jackie Chan was identified as one of the clients of Jurgen Mossack, the ABC News reported.

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ABC News, one of the media partners behind the exposé, reported that Chan’s dealings with Jurgen Mossack appeared less anomalous than other prominent personalities such as Putin, Jinping, and other prominent individuals identified by the report.

Almost half of Mossack Fonseca’s more than 200,000 clients are located in the British Virgin Islands, while the rest are scattered in different countries such as Panama, Niue, Seychelles, Bahamas, Anguilla, Costa Rica, and Samoa, among others.

The Data

The Panama papers, comprised of 2.6 terabytes of mixed files, is by far the largest scandal of its kind in terms of magnitude. In comparison, it is nearly nine times larger than the Wikileaks (1.7GB), Luxembourg leaks (4GB), and the Swiss leaks (3.3GB) combined.

To put it simply, there are 1000 GB or gigabytes in one terabyte. A GB of storage space can contain 20,000 pages of documents, which are equivalent to 1,000 files and 10 Bankers’ Boxes, the V Rooms analysis showed.

The Scheme

Although offering offshore services is a legal business in theory, it has many loopholes, which many businesses are taking advantage of. According to the report, which was initiated by the International Consortium of Investigative Journalists (ICIJ) in cooperation with different media partners, showed that the main service of Mossack Fonseca is anonymity.

The money paid by companies will pay people to act as their front, which will then be called as the nominee. They can act in different capacities, including shareholders, director, or the front owner of the company, among others. Mossack Fonseca then registers their clients’ company on an industrial scale, but these companies only exist on paper. There are no physical office nor employees. This is where the magic happens.

The Report

After a series of investigation, the ICIJ, together with its media partners such as the SZ, the BBC, the Guardian, and other leading news outlets all over the world, found that the company is more involved in shuffling money than the world previously thought.

The company claimed they only act as the middleman between companies, but this isn’t the case based on the findings. The investigation showed that the company does handle bank accounts on their clients’ behalf, which is not under the purview of the law to which offshore firms operates.

The scandal is expected to have a massive effect on an international scale, which is expected to put more pressure on governments around the world to crack down companies that hide behind dummy owners in a bid to evade taxes and anomalous transaction.

Also Read: Vladimir Putin Paranoid Of His Nuclear Weapons? Skips Nuclear Security Summit 2016

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