Panama Papers: Two Germans charged in US with tax fraud
December 5, 2018
Federal authorities have charged four men with tax evasion in the first US prosecution over the Panama Papers scandal. Among them are two German investment managers.
Image: picture-alliance/dpa/F. May
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The US Justice Department on Tuesday charged four suspects with tax evasion and fraud as part of a "decades-long criminal scheme perpetrated by [Panama-based law firm] Mossack Fonseca."
The 11-count indictment was unsealed in New York and is the first prosecution in the US related to the so-called Panama Papers investigation.
81-year-old German national Harald Joachim von der Goltz, a Mossack Fonseca client;
Richard Gaffey, an accountant from Massachusetts;
and Ramses Owens, a Panamanian attorney who worked for Mossack Fonseca.
Three of the four men are under arrest, but authorities say Owens remains at large.
The indictment in detail: The charges include conspiracy, wire fraud, tax evasion and money laundering. Prosecutors say the Panama-based law firm Mossack Fonsecaconspired to circumvent US laws to maintain the wealth of its clients and conceal tax dollars owed to the IRS. They say the scheme dates to 2000 and involved sham foundations and shell companies in Panama, Hong Kong and the British Virgin Islands.
'Playbook' of tax fraud
US Attorney Geoffrey Berman said the defendants "shuffled millions of dollars through off-shore accounts" and had "a playbook to repatriate un-taxed money into the US banking system."
"Now their international tax scheme is over," Berman said in a statement, "and these defendants face years in prison for their crimes."
Jeffrey Neiman, representing von der Goltz, said the indictment "a desperate attempt to salvage an American case out of the Panama Papers," and that his client would be "vindicated at trial."
What are the Panama Papers? The 2016 revelations, first leaked by German daily Süddeutsche Zeitung, illustrated how some of the world's richest people hide their money. The publication of millions of secret documents led to the resignation of the Icelandic prime minister and cast the spotlight on the financial affairs of leading politicians in Argentina, China and Russia, among others.
Reporters have published a raft of secret documents that reveal the strange investments and tax avoidance indulged in by the powerful and wealthy. The revelations come from the same team that uncovered the Panama Papers.
Image: picture-alliance/dpa/D.-L. Olivas
Bono and Nude Estates
U2 frontman and activist Bono was one of the highest-profile players named in the papers. In an elaborate web of financial transactions, Bono invested in a Maltese company called Nude Estates that was involved in a shady deal over a Lithuanian shopping mall. Malta is famous for its liberal tax policies. A spokesman for the singer denied any wrongdoing.
Image: picture-alliance/dpa/A. Gombert
US commerce secretary
President Donald Trump's Secretary of Commerce Wilbur Ross was listed in the papers for his interests in the Russian gas company Sibur. Ross has now been accused of failing to disclose his Russian connections to Congress during his confirmation hearing, though Ross has argued that as the company is not one facing US sanctions, he was not obliged to disclose them.
Image: picture-alliance/dpa/A. Harnik
Queen's private estate in hot water
Queen Elizabeth II is provided an income by her private estate, the Duchy of Lancaster. According to the Paradise Papers, the duchy invested 10 million pounds ($13 million) in offshore accounts in Bermuda and the Cayman Islands. The estate has said that the investments are legal.
Image: picture-alliance/dpa/D.-L. Olivas
Formula One champion
Reigning Formula One champion Lewis Hamilton reportedly avoided taxes on his private jet through an elaborate tax avoidance scheme, according go the Paradise Papers. The leaked documents show that Hamilton received a £3.3 million tax refund in 2013 after his plane was imported to the Isle of Man, a low tax British dependency located off the western coast of England.
Image: Reuters/A. Boyers
Germany's former chancellor
Gerhard Schröder, leader of Germany from 1998 to 2005, was named for his management role at the Russian-British energy firm TNK-BP in 2009. The company was registered in the tax haven British Virgin Islands. In 2013, TNK-BP was bought by Russian energy giant Rosneft — where Schröder is now the independent director of the board.
Image: Reuters/O. Astakhova
Colombia's president caught
According to the papers, Colombian President Juan Manuel Santos is listed as the director of two offshore companies in Barbados. He previously claimed to have severed ties with them in 2000 when he became minister of finance.
Image: picture-alliance/Photoshot
Lifestyles of the rich and famous
Not all of the revelations in the Paradise Papers necessarily detail illegal activity. But they do shed light on some of the strange investments and luxurious possessions of the world's elite, including Microsoft co-founder Paul Allen's yacht. Besides Microsoft, other US companies like Apple, McDonald's, Facebook and Walmart were found to have ties to Appleby.
Image: picture-alliance/PA Wire/B. Mitchell
Madonna medical supplies
One of the odd investments listed in the Paradise Papers is singer Madonna's stake in a medical supply firm. Actress Keira Knightley was also found to have stock in a Jersey-based real-estate firm.
Image: Picture alliance/AP Photo/K. Wigglesworth
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Facing jail: The most serious charges in the case, wire fraud and money laundering conspiracy, carry a maximum sentence of 20 years in prison.
