As the Paradise Papers investigation slowly unravels the reputation of high-asset notables everywhere, foreign authorities recently froze bank accounts linked to a prominent investor and KPMG.
The Paradise Papers is a treasure chest of leaked documents from the Panamanian law firm Mossack Fonsecra. More than 11.5 million records are gradually yielding the financial secrets of high and low profile people and organizations who stash their cash in foreign lands to reap the benefit of legal—and illegal—offshore tax havens.
In a recent development, Mauritian regulators froze more than 90 bank accounts associated with Jean-Claude Bastos de Morais, an investor who is founder and chairman of Quantum Global, an enterprise aimed at creating and leveraging partnerships for investment in Africa.
Before an investigation by the International Consortium of Investigative Journalists (ICIJ) pulled back the curtain on their business dealings, Mr. Bastos was working with José Filomeno dos Santos, a friend, and the son of the former president of Angola. Mr. Bastos helped Mr. Dos Santos manage Angolan monies in the national sovereign wealth fund, Fundo Soberano de Angola (FSDEA). FSDEA holds about $5 billion dollars of wealth for that country.
Fraud accusations
After the association between the parties was uncovered and Mr. Dos Santos and Mr. Bastos were accused of fraud, offshore arrangements created in Mauritius began to surface. Mr. Bastos is alleged to have received excessive fees for his work with the fund.
Well known for its lagoons and beaches, the Republic of Mauritius is located in the Indian Ocean just over one thousand miles from the African coast. First a Dutch, then French, then British possession, Mauritius became independent in 1968. Once known for its sugar, the Republic is often discussed these days for its favorable conditions for sheltering anonymous offshore investments and channeling wealth for nearby African neighbors.
Further delving into the activities of the FSDEA, in April, ICIJ investigators suggested “the movement of tens of millions of dollars” from Angola to Mauritius and onward with the help of global services company KPMG. The accounting firm has only acknowledged its work in auditing two funds for Quantum Global while documents appear to show the firm assisted in structuring offshore assets for the company as well.
The impact here in the USA
Despite reduced funding, the US Internal Revenue Service (IRS) continues to uncover—and launch criminal tax investigations of—those who take advantage of abusive offshore tax schemes.
The Paradise Papers and other leaks will continue to throw shade on illegal offshore tax practices and impact the lives, reputation, and liberty of individuals and enterprises that are mentioned in passing, or face criminal tax charges.
Experienced criminal tax defense in Cleveland and Chicago
Robert J. Fedor, Esq., LLC delivers strategic tax solutions if you are facing a tax controversy, criminal tax matter, or an IRS criminal investigation. In Chicago, Cleveland, or internationally, we provide confidential, responsive legal service when you face a tax challenge. Contact us or call 800-579-0997 today.
