The Panama Papers, 3 Years Later

Aug 15, 2019, 10:31:15 AM

Panama PapersHow much money has been recovered in the 3 years since the Panama Papers story broke? These documents exposed a network of tax havens across 200 countries. When they were released on April 3, 2016, people around the world were shocked to learn about the magnitude of global tax avoidance. More than just a scandal, the Panama Papers exposed a network of more than 214,000 tax havens involving entities from more than 200 hundred countries. Three years later, 23 countries have recovered more than $1.2 billion.

 

Exposure of the Panama Papers Led to Policy Reforms

The Panama Papers came from a Panamanian law firm, Mossack Fonseca. An anonymous whistleblower shared encrypted documents from Mossack Fonseca with a German newspaper, that also shared them with the International Consortium of Investigative Journalists (ICIJ). The ICIJ created a Pulitzer Prize winning global media project that analyzed and exposed the information in documents. Here are some fast facts from the ICIJ’s Panama Papers Project:

  • $1.2 billion in back taxes recovered. This is a global amount as of April 2019. Many governments expect to collect more as the investigation progresses.
  • 5 million leaked files from Mossack Fonseca. The leaked files included 4.8 million emails, 3 million database entries, 2.2 million PDFs, 1.2 million images, and 320,000 text files.Most of the documents showed no illegal actions.
  • ICIJ investigations found more than 785,000 offshore companies, foundations and trusts. Some of the shell corporations set up by Mossack Fonseca were used for fraud, tax evasion, or avoiding international sanctions. Mossack Fonseca ceased operations in March 2018.
  • Many prominent people were exposed. 12 current or former world leaders; 128 public officials and politicians; 61 family members and associates of prominent government figures, and hundreds of celebrities, executives, and other individuals from 200+ countries.
  • The first American charged will be tried in October. Richard Gaffey, a Massachusetts accountant, is due to be tried in October for conspiracy to commit tax evasion, money laundering and wire fraud. American politicians were initially named in the leak, but the US government sanctioned and blacklisted 33 individuals and companies for money laundering, trafficking, terrorism and fraud.
  • 16 countries have implemented at least one substantive reform related to the Panama Papers (as of March 2019).

 

Even though most off-shore tax havens are legal, the information in the Panama Papers changed how people perceive companies and wealthy individuals that take advantage of off-shore tax havens and other tax loopholes. Even though most tax havens are legal, more than 300 leading economists from 30 countries wrote a letter urging world leaders to bring an end to the financial secrecy perpetuated by offshore tax havens. Legal or not, since the release of the Panama Papers, many people now perceive that these tax havens help wealthy people avoid paying their fair share of taxes.

 

In addition, since the release of the Panama Papers the IRS has stepped up its investigations of offshore accounts and other tax shelters. While most of these offshore tools are still legal and provide many benefits to companies and individuals, speaking with an experienced and reputable tax attorney can help avoid any IRS investigation or other legal vulnerability.

 

Experience Tax Lawyers Find Tax Streategies for Individuals and Companies

With offices in Chicago and Cleveland, the attorneys at Robert J. Fedor, Esq. LLC provide aggressive representation for clients throughout the USA and globally. We can help you respond to any allegations of offshore tax improprieties and IRS audits. To learn more or to schedule a free consultation, call 800-579-0997 or contact us to schedule a free consultation.

 

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