Government authorities in at last nine countries have announced investigations into the financial activities of some of their most high-profile citizens and institutions in response to the Pandora Papers. Officials in India, Pakistan, Mexico, Spain, Brazil, Sri Lanka, Australia, Panama, and the Czech Republic promised inquiries.
Kenya’s president, Uhuru Kenyatta, has praised the leak even though it exposes the offshore fortune of his family. He promised a full response only when he returns from a trip to the Americas.
Vladimir Putin’s spokesperson Dmitry Peskov dismissed the Pandora papers as “unsubstantiated claims” and said that no hidden wealth was found in the Russian president’s inner circle. Putin does not appear in the files by name, but numerous close associates do, including his best friend from childhood – the late Petr Kolbin – whom critics have called a “wallet” for Putin’s own wealth, and a woman with whom the Russian leader was allegedly once romantically involved.
Edward Snowden, the whistleblower behind the biggest intelligence leak in history, has paid tribute to whoever leaked the Pandora papers. “Hats off to the source,” he said.
Boris Johnson has insisted that all donations to the Conservative party are vetted in accordance with rules. The leak revealed that Mohammed Amersi, a donor to his leadership campaign was involved in one of Europe’s biggest corruption scandals. Labour called on the Conservatives to return Amersi’s donations.
Rishi Sunak says it not a source of shame that London has a reputation as the tax avoidance capital of the world. He promised that the UK tax authorities would review what can be learned from the leak.
Andrej Babiš, the Czech prime minister, claimed the disclosure that he used a convoluted offshore structure to buy a mansion £13m in the south of France as deliberate attempt to damage his chances in this week’s general election. He said: “I don’t own any offshore, I don’t own any real estate in France, and all the money I lent then I got back, so let the police investigate it.”
Pakistan’s prime minister, Imran Khan, promised that his government will investigate all those mentioned in the leak. Moonis Elahi, a prominent minister in Khan’s government, contacted an offshore provider in Singapore about investing $33.7m, the leak reveals.
Jordan’s King Abdullah II claimed the leak was defamatory after it revealed he disguised his ownership of properties via a series of offshore firms. In a statement he said reports about leak “included inaccuracies and distorted and exaggerated the facts”.
The Tony Blair Institute has accused the Guardian of deliberately misrepresenting the purchase of Cherie Blair’s office premises. It says the Blairs have always paid their taxes in full and have never used offshore avoidance schemes of any kind.
Dozens of world leaders and hundreds of public officials used offshore tax havens to hide assets worth hundreds of millions of dollars, a massive investigation has found.
The Pandora Papers, published on Sunday, are based on documents leaked to the International Consortium of Investigative Journalism (ICIJ) and exposed the offshore dealings of kings, presidents and prime ministers, including Jordan’s King Abdullah II, Czech Prime Minister Andrej Babis and Kenyan President Uhuru Kenyatta.The leaked records come from 14 offshore services firms from around the world – from Vietnam to Belize to Seychelles.
Who was behind it?
The ICIJ – a network of reporters and media organisations – launched a two-year effort to sift through 11.9 million confidential files leaked to it, aided in that effort by more than 600 journalists from 150 media outlets.The team also verified the information from the 2.94-terabyte haul by cross-referencing it to public records from dozens of countries.
The ICIJ found that the documents were linked to more than 330 politicians and public officials, including 35 current and former national leaders, in more than 91 countries and territories.
“The records include information about the dealings of nearly three times as many current and former country leaders as any previous leak of documents from offshore havens,” the ICIJ wrote on its website.
More Pakistani individuals ranging from media group owners to family members of army personnel to businessmen and executives were identified in the International Consortium of Investigative Journalists' (ICIJ) “Pandora Papers” — a major international research into the financial holdings of high-profile individuals around the world.
The exposé was unveiled on Sunday and some of the names already reported include prominent figures from the PTI-led government including Finance Minister Shaukat Tarin and Senator Faisal Vawda.
The papers included the names of as many as 700 individuals from Pakistan, according to investigative journalists Umar Cheema and Fakhar Durrani of The News International who were part of the research.
A report by The News published on Monday said Jang group editor-in-chief Mir Shakilur Rehman, Dawn CEO Hameed Haroon and Express Media Group CEO Sultan Ali Lakhani also owned offshore companies.
According to the report, Rehman owns an offshore company named Brookwood Ventures Limited in the British Virgin Islands (BVI) — he was transferred the shares on April 17, 2008. When contacted by The News, he was hesitant to answer, claiming that his company was already declared so there was no point in answering the question.
However, he agreed to answer upon being urged by the investigation cell to respond otherwise questions of its transparency would arise, the report said.
"No, it’s not true, I don’t own any company. However, I had this till 2018," he told The News when the investigation cell sent him a questionnaire. When asked about why he chose to establish a company in BVI when it was a "tax and secrecy haven", he said it offered attractive conditions for investment.
Questioned by the cell on whether he had declared his company with the relevant tax authorities, The News quotes him as answering: "Yes, it was part of my wealth for the tax year 2018 and subject to taxes where applicable.”
Meanwhile, Dawn's CEO owned an offshore company called Bardney Limited that was registered in Seychelles, the report said. According to his official response to The News, the company was "duly declared" and being reported to the relevant Pakistani authorities in accordance with the law.
Similarly, Lakhani owned an offshore company Century Media Network Inc that was incorporated in February 2005 — Lakhani owned shares in the company with Muhammad Anwer Abdullah. A spokesperson for the Lakhani family told The News that "all companies are legal" and in accordance with applicable laws.
The report added that the Gourmet group, which owns TV channel GNN, also owned an offshore company, Gourmet Holdings Limited in the BVI jurisdiction, and had appointed an employee, Amna Butt, as its director.
"It is, however, not confirmed whether the company is declared with the Pakistani tax authorities or not," the report said, adding that no response had been received from Butt over a questionnaire sent to her.
Renowned journalist and editor of Pakistan Today, the late Arif Nizami was also among those who had their names in the report. He owned New Mile Production Limited in BVI that was incorporated in July 2000 with him and his wife declared as its beneficial owners.
"Both Mr and Mrs Nizami through this company held investment portfolios with Standard Chartered Bank Singapore, which included cash accounts, bonds, equities and mutual funds.
"The documents reveal that the estimated value of these assets at that time was $1.6 million. It is, however, not clear whether the company is declared with the tax authorities in Pakistan or not," the report said.
Family members of military personnel
The report by The News identified more former military leaders and their family members named in the Pandora Papers.
According to the report, the son-in-law of former Punjab governor Lt Gen (retd) Khalid Maqbool, Ahsan Latif, owned an offshore company Dylan Capital Limited that was registered in the BVI jurisdiction.
It added that according to the documents, the company was incorporated for "investment holding for certain properties in the UK and the UAE, but it was used for importing LPG (liquid petroleum gas) from Russia’s Vacus Oil Company Ltd".
The report mentioned that it was not clear whether Latif had declared these assets to Pakistan's tax authorities and no response to a query was received.
The Pandora Papers also reveal that Muhammad Hasan Muzaffar, the son of Lt Gen (retd) Muhammad Afzal Muzaffar, owned shares in a company registered in BVI, Creek Growth Capital Holding Ltd. According to the report by The News, this offshore company owned Southeast Healthcare Holding which controlled a medical centre based in Dubai that was apparently closed now.
"Hasan told ICIJ that the simple fact is there is no relation of this investment to his father. He further commented that the investment was made solely from his own income earned in the UAE and came from his UAE bank account. No other family member, including his father, was involved," the report said.
Zahra Tanvir, the wife of Lt Gen (retd) Tanvir Tahir, was also identified by the report as owning an offshore company, Ener Plastic Limited, in the BVI jurisdiction.
"The Pandora Papers show that Mrs Zahra Tanvir is one of the beneficial owners of the company. As per the leaked documents, Ener Plastics Limited is a holding company and dividends and real investment [are] the main source of funds for the company," the report said.
It added that The News received no response over a questionnaire sent to her.
Businessmen & executives
Javed Afridi, owner of the Peshawar Zalmi franchise, also owns three offshore companies according to revelations from the Pandora Papers: Old Trafford Properties Ltd, Sutton Gas Works Properties Ltd and Gas Works Property Ltd.
The News report said he confirmed his ownership of the companies, explaining that the reason behind incorporating them was for the "good intention to save tax rather than avoiding any tax".
"According to him, the companies were almost dormant, and no business or investment was done by any of the companies," the report said.
According to the report, National Bank President Arif Usmani incorporated a company, Sasa Partners Inc, in the BVI offshore tax havens in March 2018. It added that the Pandora Papers revealed him to be the company's beneficial owner where he kept bankable assets.
Usmani was questioned on a number of issues by The News to which he responded that all his tax records had been provided to the Federal Board of Revenue (FBR) and every asset he owned — internationally or locally — was declared in his wealth statements filed with the FBR.
The report also identified the managing director of National Investment Trust, Adnan Afridi, as having registered an offshore company, Veritas Advisory Services Ltd, in the BVI jurisdiction in October 2011.
Afridi confirmed owning the company to The News, adding that it was struck off the register of companies in the BVI in December 2017 due to being dormant.
In a separate statement, he said that there was a legitimate reason for using an offshore corporate entity. He said that he acquired the company because he needed a corporate entity for "a time sensitive international strategy consulting bid".
"The reason for opting for a BVI entity was simply the low cost, ease of acquisition and its international standing (it was included in the acceptable list of jurisdictions by the consulting bid platform at the time)," he said.
He added that the consulting bid was unsuccessful and the company "remained completely dormant during the entire tenure of its existence beyond submission of a couple of unsuccessful consulting bids."
Among family members of bureaucrats identified in the Papers, the report said former FBR chairman and finance secretary Salman Siddique's son, Yawar Salman, owned an offshore company as well.
According to the documents, his son had registered Cres Tech Holdings Limited in the BVI with partner Noeen Ahmed Anwar just months prior to Siddique's retirement.
"Yawar Salman told The News that the entity Cres Tech Holdings was incorporated as part of a then-envisaged plan to undertake a foreign business. However, owing to certain circumstances, neither any equity was contributed nor any bank account opened.
"Since no equity was ever contributed and the entity’s worth remains ‘nil’, the question of disclosing it to the tax authorities does not arise," the report quoted him as saying.
The list, currently released, includes the names of all the leaders, officials and other famous personalities of Pakistan troubled by debt and starvation. The list also includes names of many close to Prime Minister Imran Khan, including Pakistan’s Finance Minister Shaukat Tarin.
Pandora Paper featured Pakistani Senator Faisal Wawda, Pakistan Muslim League-Q leader Chaudhry Munis Elahi, Ishaq Dar’s son, PPP’s Sharjeel Memon, Industry and Production Minister Khusro Bakhtiar’s family, PTI leader Abdul Aleem Khan, Exact CEO Shoaib Sheikh K. Names included. Media reports from Pakistan have said that a total of more than 700 Pakistanis have been named in the investigation. These people had dealings with foreign companies. Not only this, the names of some retired army officers, businessmen and owners of media companies have also come to the fore. Investigative journalist Umar Cheema from Pakistan and Fakhar Durrani of The News International were also involved in the search for the Pandora Papers.
According to media reports, the leaked documents revealed that close friends, relatives, relatives of Prime Minister Imran Khan, including some cabinet ministers and financiers in the government, “secretly own and hold several companies and trusts”. There are illicit assets worth millions of dollars. However, it has not been disclosed in these documents whether Prime Minister Imran Khan also has any such assets. At the same time, according to the ICIJ, the chief of Pakistani ruling political party PTI in these documents The transactions of donor Arif Naqvi are also traced.Arif is facing fraud charges in the United States
Significantly, in the Pandora Papers leak, the secret deals and illegal money of all the rich and influential people of the world including India can be revealed. More than 10 million files have been examined to trace the people behind many foreign companies and trusts around the world in countries such as Dubai, Monaco, Switzerland and the Cayman Islands in the Pandora Papers leak.
In the document prepared by ICIJ, apart from more than 100 nobles, companies have been found in the names of eminent personalities from Russia, India, Pakistan, UK, Mexico. The Pandora Papers also includes information related to the King of Jordan, Ukraine, the Presidents of Kenya, the Prime Minister of the Czech Republic and former British Prime Minister Tony Blair. It is believed that more detailed disclosures can be made in the next few days.
What's in a name
The papers are named after the Greek myth of Pandora’s box.
In the tale, Pandora opens a sealed box containing the forces of evil and suffering which, once released, were uncontainable.
BBC quoted Gerard Ryle, the director of ICIJ, as saying this leak was given the name because “we're opening a box on a lot of things”.
Are offshore companies illegal?
Setting up offshores companies to do business is not in itself illegal, the ICIJ stressed, as some people might have legitimate reasons to keep their finances secret.
But such entities have often proven to be attractive as they can facilitate tax evasion and money laundering.
Such revelations are no less of an embarrassment for leaders who may have campaigned publicly against tax avoidance and corruption, or advocated austerity measures at home.
Who has been named?
Among significant individuals named are Jordan’s King Abdullah II who was alleged to have used offshore accounts to spend more than $100m on luxury homes in the UK and US.
Days ahead of the Czech Republic’s October 8-9 parliamentary election, the documents allegedly tied the country’s prime minister, Babis, to a secret $22m estate in a hilltop village near Cannes, France.
The Papers also listed Kenya’s President Uhuru Kenyatta and his mother as beneficiaries of a secretive foundation in Panama.
The leaked document also showed that three of Kenyatta’s siblings own five offshore companies with assets worth more than $30m.
As well as politicians, the public figures exposed included Colombian singer Shakira, German supermodel Claudia Schiffer and former Indian cricket captain Sachin Tendulkar.
Offshore system
Besides unveiling the financial dealing of hundreds of world leaders and celebrities, the investigation put the spotlight on the offshore system itself, with the US emerging as a big player in the offshore world.
South Dakota, the files show, emerged as the US state with the largest number of trusts – a financial mechanism used often to avoid or greatly reduce taxation.
The Pandora Papers are the latest in a series of mass ICIJ leaks of financial documents, from LuxLeaks in 2014, to the 2016 Panama Papers, which triggered the resignation of the prime minister of Iceland and paved the way for the leader of Pakistan to be ousted.
They were followed by the Paradise Papers in 2017 and FinCen files in 2020.