Panama has put on trial 27 people implicated in the Panama Papers money laundering scandal, exposed in a 2016 leak of the secret financial information of thousands of wealthy business figures and officials from a law firm in the tax haven. File Photo by U.S. Department of State/UPI
April 9 (UPI) — A Panamanian criminal court on Tuesday launched a trial for 27 people charged in the Panama papers money laundering scandal, eight years after a leak from a law firm in the tax haven exposed the secret financial dealings of thousands of wealthy business figures and officials from around the world.
The defendants in the three week trial which got underway Monday at the Supreme Criminal Court in the Gil Ponce Palace of Justice in Panama City are all charged with commissioning the crime of money laundering, the Panama Judicial Authority said in a news release.
The disclosure of more than 11 million confidential documents from corporate service provider and law firm Mossack Fonseca detailed how billionaires, government leaders and star athletes hid their assets in offshore shell companies and special purpose financial vehicles to avoid paying taxes.
The founders of the firm, Jurgen Mossack and Ramon Fonseca Mora, who are among the defendants, claim the files were stolen by hackers and that the information contained in them has been misrepresented.
If convicted, Mossack, who was in court Monday for the opening of the trial, and Fonseca, whose lawyers told the bench he was unable to attend due to receiving treatment in a Panama hospital, could receive maximum prison sentences of 12 years.
The information on people from 200 countries, which the International Consortium of Investigative Journalists combined with other leaks into a searchable database, revealed how the powerful from then-prime ministers of Iceland and Pakistan to Ukrainian President Petro Poroshenko and the king of Saudi Arabia parked money and assets in opaque offshore jurisdictions like Panama and the Virgin Islands, allegedly to conceal wealth.
The subsequent ICIJ investigation alleges Mossack Fonseca provided its services to 33 individuals and companies on a U.S. government blacklist for their business dealings with Mexican drug lords, terrorist organizations such as Hezbollah and rogue states like North Korea and Iran.
The ICIJ revealed offshore companies connected to relatives of Chinese Communist Party leader President Xi Jinping, who came to office vowing to take on China’s “armies of corruption,” and Poroshenko, who wore his reformist credentials on his sleeve during his 2014-2019 presidency.
Analysis also showed close associates of Russian President Vladimir Putin funnelled as much as $2 billion through offshore banks and secret accounts.
In its follow-up 2021 Pandora Papers, an ICIJ investigation of millions of confidential files uncovered alleged clandestine financial dealings by 35 current and former heads of state, out of more than 330 politicians and public officials.
It found Jordanian King Abdullah II bin Al-Hussein used offshore companies to purchase Malibu, Calif., beachfront property and former Czech Prime Minister Andrej Babis acquired a French Riviera chateau by the same means.
Former British Prime Minister Tony Blair was alleged to have avoided paying hundreds of thousands of dollars in taxes by putting a multi-million dollar property purchase through an offshore company his wife’s company purchased in the Virgin Islands.
