Panama Papers, the cat's out of the bag!
The world's largest document leak has landed many notables of the world into hot waters.
Dunya News Report (Madiha Fareed)
The biggest document leak of the history has caused a global frenzy on how the powerful and wealthy use tax havens to hide their wealth. At the centre of the controversy is a lesser known Panamanian law firm “Mossack Fonseca” which is a gatekeeper to vast flow of shadowy off-shore secrets and for almost 40 years it has helped its clients set-up offshore companies in tax havens order to hide their wealth.
“The Panama Papers” or “Panama Leaks” is unprecedented in size and scale as it contains 11.5 million documents of size 2.6 terabyte. The journalistic wonder was pulled off by “The International Consortium of Investigative Journalists” (ICJI) which exposed the hidden million companies of world’s notables in the form of offshore. The documents were obtained by the German Newspaper Sueddeutsche Zeitung and were shared with ICIJ.
Among the named are renowned world leaders, business personalities and celebrities. There are links to 12 current or former heads of states. A friend of Russian president Vladimir Putin was found to be the owner of an offshore company worth $2 billion while the son-in-law of Chinese president Xi Jingpin was also found to be a shareholder of an off-shore company. Among the other prominent figures are the prime ministers of Pakistan and Iceland, the president of Ukraine, the king of Saudi Arabia, 29 of the Forbes wealthiest 500 and celebrities including Jackie Chan, Amitabh Bachchan and Aishwarya Rai. The soccer sensation Lionel Messi was also found to be owners of a Panama-company along with his father.
Panama is one of a number of popular tax havens in the Caribbean. Although there are legitimate ways of using tax havens, most of what has been going on is about hiding the true owners of money, the origin of the money and avoiding paying tax on the money. British Virgin Islands is also a well-known tax haven and a top destination for anyone looking to hide their wealth.
The journalists behind the biggest leak in the history have hinted that there are several other documents to come which would reveal how the money was laundered for the purposes of tax evasions.
The Prime Minster of Iceland Sigmundur David Gunnlaugusson was forced to resign after being linked to the leaks. Thousands of protesters in Iceland took to streets in and threw eggs and yougurt at the parliament building demanding the resignation of the “untruthful” prime minister. The leak has triggered investigations in multiple countries. Sweden, Australia, Austria, Brazil, and New Zealand have already started the investigations into the matter.
According to the Panama Papers, almost 200 politicians and businessmen from Pakistan own off-shore companies. The leaks reveal that Prime Minister Nawaz Sharif’s three children, Hassan Nawaz, Hussain Nawaz and Mariam Safdar are listed in the papers for establishing off-shore companies in a tax-haven.
The Sharif family has maintained that there’s nothing illegal about owning the off-shore companies. Hussain Nawaz Sharif, the prime minister s eldest son, said he owned the offshore companies named in the leaks but that he and his family members had broken no laws.
“I have been living abroad for many years and have invested there. I have not done anything illegal,” Sharif told the Geo TV news channel. “I have been doing business according to Pakistan’s foreign act and other Pakistani laws, including the income tax laws.”
Maryam Safdar, Prime Minister’s daughter took to twitter and denied all the allegations in a series of tweets. She said: "As stated earlier, I do NOT own any company/property abroad. My brother has made me a trustee in one of his corporations which only entitles me to distribute assets to my brother Hussain s family/children if needed. Nothing more than what my brother has already explained. The info provided by leaks does NOT say any wrongdoing involved. Distortion is wilful that a couple of media channels using to settle scores”.
Like the rest of the world, the Panama papers have caused uproar in the Pakistani media and political circles. Pakistan Tehreek-e-Insaf’s (PTI) chief lashed out at Prime Minister Nawaz Shareef for having off –shore properties of millions, when the country he rules and get votes from has to rely on foreign loans that have crippled the economy of the country.
Imran Khan accused Sharif of acquiring the properties and transferring them to his children to shield himself from liability under Pakistani tax laws. Khan said that Pakistan’s National Accountability Bureau, an anti-corruption watchdog, “must take action” to determine how Sharif’s family obtained the money to set up the offshore accounts.
Prime Minister Nawaz Sharif on Tuesday, in an attempt to address the issue, announced to form a “judicial commission” which will be headed by a retired judge so that the “accusers” can prove the allegations. Prime Minister’s “gracious step” to render himself for accountability is questionable on two accounts, 1) the “judicial commission” cannot be headed by a retired judge. 2) Who has the burden of proof?
The major opposition parties in the country including PPP, PTI and JI have rejected the prime minister’s proposed judicial commission.
The Prime Minister’s approach is the antithesis of how the rest of the world is dealing with the matter. In other countries the institutions of the state have taken notice to investigate the leaks as it could prove potential malfeasance, money laundering and tax evasion by the notables.
The Pakistan Muslim League- Nawaz (PML-N) is clearly missing the point or rather seems oblivious to the matter at hand. It is handling the issue just like many other issues in the past by terming it as a “conspiracy of opposition” and focusing all its energies to frame this issue as a personal grudge or agenda of Imran Khan against the Sharif Family while completely ignoring the fact that the leak was pulled off by an international and independent consortium of journalists and includes the names of many of the world’s top leaders.
The resignation of Iceland’s Prime Minister is vindication of the western democratic system. However in Pakistan no such precedent could be found. Accountability is at the heart of democracy, and it is in country’s best interest that like the rest of the world a fair and independent probe is launched to investigate the matter.
