'Panama Papers' push Iceland's PM to resign

[webfact]

'Panama Papers' push Iceland's PM to resign



LONDON: -- Iceland’s under pressure prime minister,Sigmundur Davíð Gunnlaugsson has tendered his resignation after his family’s offshore investments were revealed in the ‘Panama Papers’ leak.

The move must first be approved by his government’s coalition partners and the president before becoming official.

Gunnlaugsson and his wife allegedly set up a company in the British Virgin Islands with help from Mossack Fonseca the Panama law firm at the centre of the scandal.

-- (c) Copyright Euronews 2016-04-06

[webfact]

Iceland's leader is first victim of offshore holdings leak
By JILL LAWLESS and DAVID McHUGH

LONDON (AP) — The leak of millions of records on offshore accounts claimed its first high-profile political casualty Tuesday as Iceland's prime minister stepped aside amid outrage over revelations he had used such a shell company to shelter large sums while Iceland's economy was in crisis.

Icelandic leader Sigmundur David Gunnlaugsson is the first major figure brought down by the publication of the names of rich and powerful people linked to the leaks, dubbed the Panama Papers.

China and Russia, meanwhile, took the opposite approach, suppressing the news and rejecting any allegations of impropriety by government officials named in the leak of more than 11 million financial documents from a Panamanian law firm.

Officials in Ukraine, Argentina and other countries are also facing questions about possibly dubious offshore tax-avoidance schemes.

The reports are from a global group of news organizations working with the Washington-based International Consortium of Investigative Journalists. They have been processing records from the Mossack Fonseca law firm that were first leaked to Germany's Sueddeutsche Zeitung newspaper.

The announcement that Gunnlaugsson was stepping down as leader of Iceland's coalition government came from his deputy, Sigurdur Ingi Johannsson, who is also the country's agriculture minister. It followed the refusal by Iceland's president to dissolve parliament and call a new election, and after thousands of Icelanders protested outside the parliament building in Reykjavik.

No replacement has yet been named, and President Olafur Ragnar Grimsson did not immediately confirm that he had accepted the resignation. Late Tuesday, a government statement said Gunnlaugsson had suggested Johannsson take over as prime minister for "an unspecified amount of time," while Gunnlauggson would stay on as leader of his center-right Progressive Party.

Gunnlaugson has denied any wrongdoing and said he and his wife have paid all their taxes. He also said his financial holdings didn't affect his negotiations with Iceland's creditors during the country's acute financial crisis.

The leaked documents allege that Gunnlaugsson and his wife set up a company called Wintris in the British Virgin Islands with the help of the Panamanian law firm. Gunnlaugsson is accused of a conflict of interest for failing to disclose his involvement in the company, which held interests in failed Icelandic banks that his government was responsible for overseeing.

Iceland, a volcanic North Atlantic island nation with a population of 330,000, was rocked by a prolonged financial crisis when its main commercial banks collapsed within a week of one another in 2008.

Since then Icelanders have weathered a deep recession and been subjected to tough capital controls — another reason the prime minister's offshore holdings rankle many.

China, on the other hand, dismissed as "groundless" reports that the Panamanian law firm had arranged offshore companies for relatives of at least eight present or past members of the Communist Party's Politburo Standing Committee, the apex of power in China.

Among those named in the leaked documents was the brother-in-law of President Xi Jinping. State media have ignored the reports and searches of websites and social media for the words "Panama documents" were blocked.

China's Foreign Ministry spokesman Hong Lei said he would not discuss the reports further and declined to say whether the individuals named would be investigated.

"For these groundless accusations, I have no comment," Hong told reporters at a regularly scheduled news conference.

Meanwhile, Ukraine's president was accused of abusing his office and of tax evasion by moving his candy business offshore, possibly depriving the country of millions of dollars in taxes.

Shell companies aren't in themselves illegal. People or companies might use them to reduce their tax bill legally, by benefiting from low tax rates in countries like Panama, the Cayman Islands and Bermuda. But the practice is frowned upon, particularly when used by politicians, who then face criticism for not contributing to their own countries' economies.

Because offshore accounts and companies also hide the names of the ultimate owners of investments, they can be used to illegally evade taxes or launder money.

Mossack Fonseca says it obeys all laws relating to company registrations and does not advise people how to evade taxes.

The firm said in a statement that "our industry is not particularly well understood by the public, and unfortunately this series of articles will only serve to deepen that confusion.

"The facts are these: While we may have been the victim of a data breach, nothing in this illegally obtained cache of documents suggests we've done anything wrong or illegal, and that's very much in keeping with the global reputation we've worked hard to build over the past 40 years of doing business the right way."

Members of the Group of 20 — which includes China — have agreed on paper to tighten laws relating to shell companies and make sure authorities can find out who the real owners are. Actual legislation at the national level has lagged behind the promises, however.

The appearance of offshore accounts in political scandals is far from new. Shell companies played a role in the corruption scandal involving the Petrobras oil company in Brazil. The U.S. Justice Department said in an indictment last year that offshore accounts were used to mask the transfer of bribes to officials at FIFA, the global soccer federation.

Sueddeutsche Zeitung, working with Germany's NDR and WDR public television stations, reported Monday that 14 German banks had used Mossack Fonseca's services to set up 1,200 letterbox companies for clients.

The report said use of offshore company registrations had spiked after the European Union introduced regulations in 2005 requiring countries to exchange tax information on individual people, but not for companies. Many of the accounts, however, have since been closed.

The EU has since tightened its rules on offshore companies under its Fourth Anti-Money Laundering Directive, which is being phased in as national governments pass local laws to comply by June 26, 2017. The new rules tighten requirements for companies to keep accurate information on their real owners and to make that available to authorities.


-- (c) Associated Press 2016-04-06

[shirtless]

We are all expected to pay these stupid taxes but not the Pm. what sort of example is he setting. same as all our leaders.

[steve187]

typical member of any countries parliament, - corrupt and looking after number 1.

[eggers]

The "Panama Papers" illustrate the amount of graft, corruption & deception by so called political leaders worldwide.

Very few can be believed or trusted, they're a bunch of self serving, lying,self righteous types who gain through deceit at expense of others & public purse.

[craigt3365]

typical member of any countries parliament, - corrupt and looking after number 1.

Not all, but some, yes. Though he did the right thing and his country allowed the news reports to be published. Unlike those in Russia and China who are 100% suppressing the news and denying anything happened.

China and Russia, meanwhile, took the opposite approach, suppressing the news and rejecting any allegations of impropriety by government officials named in the leak of more than 11 million financial documents from a Panamanian law firm.

[ozyjon]

What they did is lawfully not illegal but morally

they pay 11% tax where we pay 30% tax, that's

where it's wrong.

[mike324]

wonder if any of the US politicians are included in the leak? would be surprise if there were none...perhaps that might indicate the Panama Papers is the work of the US government again to bring down countries

[craigt3365]

What they did is lawfully not illegal but morally

they pay 11% tax where we pay 30% tax, that's

where it's wrong.

What's wrong is providing the legal loopholes to only pay 11%. Nothing wrong with tax avoidance. It is legal.

[wabothai]

Good !!! next.

[ALLSEEINGEYE]

Will be interesting to see how many politicians and high profile people will be uncovered for this.

I would almost suggest that it could affect the US Prez race but all of the candidates are probably all involved so will cancel each other out.

Likely that a majority of politicians around the world will be caught up in this.

Likely no one will do time except the whistle blower though

It ain't just Thailand, no justice anywhere when it comes to the rich and powerful.

[Neurath]

What they did is lawfully not illegal but morally

they pay 11% tax where we pay 30% tax, that's

where it's wrong.

What's wrong is providing the legal loopholes to only pay 11%. Nothing wrong with tax avoidance. It is legal.

What's wrong with getting welfare? Nothing wrong with welfare. It is legal. But of course those arguing that tax avoidance if legal is ok, will say that Welfare when legal is immoral. What's sauce for the goose is not sauce for the gander in this case eh?

[Assurancetourix]

 

wonder if any of the US politicians are included in the leak? would be surprise if there were none...perhaps that might indicate the Panama Papers is the work of the US government again to bring down countries

 

The americains don't need to go to Panama; they have the Delaware , Cayman islands and The Bahamas ;

[craigt3365]

 

wonder if any of the US politicians are included in the leak? would be surprise if there were none...perhaps that might indicate the Panama Papers is the work of the US government again to bring down countries

 

The americains don't need to go to Panama; they have the Delaware , Cayman islands and The Bahamas ;

Delaware is used to setup corporations, for a variety of reasons. No way can you evade taxes or hide your money there.

Cayman and Bahamas don't belong to the US and are considered offshore banking centers. Same as Panama, with all the risks associated with that for US citizens. I.E. you have to report your holdings or your in big trouble if caught.

[khunken]

 

wonder if any of the US politicians are included in the leak? would be surprise if there were none...perhaps that might indicate the Panama Papers is the work of the US government again to bring down countries

 

The americains don't need to go to Panama; they have the Delaware , Cayman islands and The Bahamas ;

Delaware is used to setup corporations, for a variety of reasons. No way can you evade taxes or hide your money there.

Cayman and Bahamas don't belong to the US and are considered offshore banking centers. Same as Panama, with all the risks associated with that for US citizens. I.E. you have to report your holdings or your in big trouble if caught.

The problem with the Panama Papers is the selective release of only part of the data that was originally hacked. The ICIJ 'journalists' are protecting many US individuals in the unreleased part of the data and even commenting on some of the data released.

This is Fox 'news' type tactics with the emphasis on the Russian 'connection' in particular in attempting to besmirch Putin because a friend of his is involved. 2+2=5

It's basically the same tactic to target Cameron whose dead father has a mention in the papers released.

Wikileaks & others have strongly criticised the selective release & even tied the release to Soros - not proven but similar to ICIJ 'journalism'.

All the data should be released to well regarded newspapers, Wikileaks style, who will then release factual quotes from the documents, only suppressing data which targets the innocent.

[craigt3365]

The problem with the Panama Papers is the selective release of only part of the data that was originally hacked. The ICIJ 'journalists' are protecting many US individuals in the unreleased part of the data and even commenting on some of the data released.

This is Fox 'news' type tactics with the emphasis on the Russian 'connection' in particular in attempting to besmirch Putin because a friend of his is involved. 2+2=5

It's basically the same tactic to target Cameron whose dead father has a mention in the papers released.

Wikileaks & others have strongly criticised the selective release & even tied the release to Soros - not proven but similar to ICIJ 'journalism'.

All the data should be released to well regarded newspapers, Wikileaks style, who will then release factual quotes from the documents, only suppressing data which targets the innocent.

Americans are mentioned in the Panama Papers. Just not to the same extent as other countries, and for good reason. As mentioned here:

http://www.politico.com/agenda/story/2016/04/the-panama-papers-where-are-the-americans-000083

Tax evasion overall is a far larger problem in developing countries, where norms around paying taxes are weak and rules designed to stop such evasion are ineffective. And when wealthy Americans do want to evade taxes, they turn to Bermuda, or the Cayman Islands, or Singapore. They don’t park their money in Panama.

“Within the [high-net worth] world, there is a national taste as in anything else,” said Edward Kleinbard, a professor of law and business at the University of Southern California, “and I think Panama is a disfavored country among U.S. advisers because it is viewed as an outlier relative to world norms.”

I've looked into offshore accounts many times in the past. Panama was never really mentioned. Cayman and Bermuda were mentioned all the time.

[mike324]

Americans are mentioned in the Panama Papers. Just not to the same extent as other countries, and for good reason. As mentioned here:

http://www.politico.com/agenda/story/2016/04/the-panama-papers-where-are-the-americans-000083

I've looked into offshore accounts many times in the past. Panama was never really mentioned. Cayman and Bermuda were mentioned all the time.

Pretty interesting to read from the link

"“If there was a leak from Singapore, as opposed to Panama, which is what we have so far, we might find more [evasion],” said Reuven Avi-Yonah, a law professor at the University of Michigan who has testified before Congress about tax evasion."

[Naam]

 

wonder if any of the US politicians are included in the leak? would be surprise if there were none...perhaps that might indicate the Panama Papers is the work of the US government again to bring down countries

 

The americains don't need to go to Panama; they have the Delaware , Cayman islands and The Bahamas ;

Delaware is used to setup corporations, for a variety of reasons. No way can you evade taxes or hide your money there.

Cayman and Bahamas don't belong to the US and are considered offshore banking centers. Same as Panama, with all the risks associated with that for US citizens. I.E. you have to report your holdings or your in big trouble if caught.

but you can hide non yield producing assets which do not require a financial institution in companies incorporated in Delaware, Connecticut and Wyoming.

the result is that you can evade taxes if the country of your tax residence levies a wealth tax (a number of countries do that).

by the way, Wyoming has less than 600,000 inhabitants but 850,000 registered corporations

[khunken]

The problem with the Panama Papers is the selective release of only part of the data that was originally hacked. The ICIJ 'journalists' are protecting many US individuals in the unreleased part of the data and even commenting on some of the data released.

This is Fox 'news' type tactics with the emphasis on the Russian 'connection' in particular in attempting to besmirch Putin because a friend of his is involved. 2+2=5

It's basically the same tactic to target Cameron whose dead father has a mention in the papers released.

Wikileaks & others have strongly criticised the selective release & even tied the release to Soros - not proven but similar to ICIJ 'journalism'.

All the data should be released to well regarded newspapers, Wikileaks style, who will then release factual quotes from the documents, only suppressing data which targets the innocent.

Americans are mentioned in the Panama Papers. Just not to the same extent as other countries, and for good reason. As mentioned here:

http://www.politico.com/agenda/story/2016/04/the-panama-papers-where-are-the-americans-000083

Tax evasion overall is a far larger problem in developing countries, where norms around paying taxes are weak and rules designed to stop such evasion are ineffective. And when wealthy Americans do want to evade taxes, they turn to Bermuda, or the Cayman Islands, or Singapore. They don’t park their money in Panama.

“Within the [high-net worth] world, there is a national taste as in anything else,” said Edward Kleinbard, a professor of law and business at the University of Southern California, “and I think Panama is a disfavored country among U.S. advisers because it is viewed as an outlier relative to world norms.”

I've looked into offshore accounts many times in the past. Panama was never really mentioned. Cayman and Bermuda were mentioned all the time.

Well US individuals are certainly mentioned in the papers and ICIJ have not, so far, released the details of them that they have admitted are contained therein.

I disagree with you about developing countries being more prone to tax evasion than developed ones. The UK for example has two tax havens within its waters: Isle of Man & the Channel Islands. Luxembourg & even Ireland (my country) are tax havens of sorts. There are far more rich people in developed countries that use these tax havens (including the Caymans & others) than in developing countries.

Even multinationals move their profits into tax havens as a tax evasion strategy. It's an on-going issue with a number of them and the EU & US tax authorities are not amused.

Edited April 6, 2016 by khunken

[craigt3365]

I had a shell company in Wyoming for quite a few years. I read a report that the address used had thousands of companies there . 555 I closed it down not very long after that.