As part of a global project, Venezuelan journalists participated in the review of millions of files leaked from a Panamanian law firm specialized in registering companies in tax havens. The documents, obtained by the German newspaper 'Süddeutsche Zeitung' and processed by the International Consortium of Investigative Journalists (ICIJ), show patterns for government officials and business groups to hide their identities or money.
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The information includes e-mails, financial forms, passports and corporate records that reveal the secret owners of bank accounts and companies in 21 offshore jurisdictions. The filtered internal files of MF (Mossack Fonseca law firm) contain information on 214,488 offshore entities connected to people in over 200 countries and territories.
The incredible amount of information led the newspaper to resort to ICIJ, based in Washington DC, and with previous experience in this type of project, which developed an ad hoc team to organize and process the information. The database was shared with a network of more than 370 journalists and 100 media around the world.
In the case of Venezuela, the investigation began in June 2015 and involved 11 journalists from different electronic media. Although a large part of the hundreds of thousands of documents related to Venezuela do not include relevant information, the mere review, analysis and processing of the information entailed months of work.
It is clear that organizing an offshore company itself is not a crime and it is even natural for certain commercial transactions.
Most services provided by the offshore industry are legal if used by those who abide to the law. But the documents show that banks, law firms and other offshore players often did not meet the law requirements to make sure that their clients are not involved in criminal activities, tax evasion or political corruption. In some cases - as evident in the files - offshore intermediaries protected themselves and their clients by concealing suspicious transactions or altering official records.
Sometimes the provider did verify through due diligence that a prospect was a Politically Exposed Person (PEP) or someone suspected of criminal activities, but decided to ignore the finding.
This unusual journalistic access to the internal management of Mossack Fonseca and its relationship with its clients made it possible to verify that provider and client regularly scheme to mislead the regulatory authorities of their countries of origin on the ownership of companies, and subsequently arrange the registration of companies previously registered, among other practices aimed to cover up the circulation of money that is concealed or legitimized.
The information obtained from MF, for the Venezuelan case, offers significant examples of what happened during the last 15 years with the destiny of the vast flows of oil revenues that the State managed in the framework of a policy of massive imports and the maintenance of differential rates. There were traces of former public officials, whose regular income - limited by definition - was no objection to ordering MF to open and manage shell companies in tax havens.
It
is also evident that the Panamanian company put together tailored-made corporate
structures for some Venezuelan clients who wanted either to dissipate their
presence in companies organized with directors of MF itself or generate external
debt through transactions with empty shells
that could be presented later on
to the administrative entity in a Venezuela under the exchange control
regime.
They are part of the financial, legal and fiscal maneuvers that were plotted in MF, sometimes at the suggestion of the provider, sometimes at the request of the client or at the request of an intermediary such as banks or law firms.
The leakage of information sheds light on a corner of submerged finance that journalistic investigations cannot normally reach.
In the texts comprising the special emerge names as those of the former Chief of Escorts of Hugo Chávez, Adrián Velásquez, and the former Head of the program of social assistance Plan Bolívar 2000, Víctor Cruz Weffer, with companies under their control in tax havens. Several authorities of the state oil company PDVSA also did the same.
Entrepreneurs —some linked to the revolutionary government of Venezuela, although they later appeared under asylum in other nations— also used Mossack Fonseca to cover up their financial operations. Their names will come out from today. There are also cases of businesspersons who opened corporate facades in tax havens such as Hong Kong, Panama, the Virgin Islands or Belize to take advantage of the opportunities opened by the eagerness to import of the Government.
Heads of State, social and sports celebrities, organized mafia leaders, swindlers… On a global scale, the massive leak of documents has allowed to reveal the face of different celebrities never known by the people. In fact, it allowed discovering previously unknown characters that people should know.
The files show offshore companies controlled by the prime ministers of Iceland and Pakistan, the king of Saudi Arabia and the sons of the president of Azerbaijan. They also include at least 33 people and companies blacklisted by the US government based on evidence that they have done business with Mexican drug lords, terrorist organizations such as Hezbollah and renegade nations like North Korea.
One of these companies provided fuel for the aircraft that the Syrian government used to bomb and kill thousands of its own citizens, as accused by US authorities. It became clear how associates of Russian President Vladimir Putin surreptitiously moved up to $ 2,000 million through banks and secret companies.
The list of world leaders who used Mossack Fonseca to organized offshore companies includes the current president of Argentina, Mauricio Macri, who was the director and vice president of a company in the Bahamas run by Mossack Fonseca when he was an entrepreneur and the mayor of the Argentine capital. A spokesman for Macri said the president was never personally owned shares in the firm, that it was part of his family's businesses.
The files also highlight the contradictions of some champions in the fight against corruption.
They detected offshore companies linked to the family of Chinese leader Xi Jinping, who has sworn to fight against "armies of corruption", as well as eight other members of the Politburo of the ruling Communist Party of China.
Also companies linked to Ukrainian President Petro Poroshenko, who has positioned himself as a reformer in a country shaken by corruption scandals. The files contain new details of the offshore businesses of the late father of British Prime Minister David Cameron, a leader seeking a reform of tax havens.
The traces of Mossack Fonseca are in the African diamond trade, the international art market and other businesses that benefit from secrecy. The firm has provided service to so many members of the Middle Eastern royalty as to fill a palace. It has helped two kings, Mohammed VI of Morocco and the Salman of Saudi Arabia, to go out to sea in luxurious yachts.
The leaked documents reveal that the law firm of Juan Pedro Damiani, a member of FIFA's ethics committee, had business relationships with three men who have been indicted in the FIFA scandal: former FIFA vice president Eugenio Figueredo and Hugo and Mariano Jinkis, the father and son duo accused of paying bribes to win the rights to broadcast football events for Latin America. The records show that Damiani's legal signature in Uruguay represented an offshore company linked to the Jinkis and seven companies linked to Figueredo. The best soccer player in the world, the Argentine Lionel Messi, also appears in the documents. A company in Panama established for him by Mossack Fonseca in 2012, Mega Star Enterprises Inc., adds a new name to the list of shell companies that are known to be linked to Messi. His offshore businesses are currently the target of a tax evasion case in Spain.
Until recently, Mossack Fonseca operated mainly in the shadows. But it has been under increasing scrutiny as governments have obtained partial leaks from the firm's files, and authorities in Germany and Brazil have begun to investigate their practices.
In February 2015, Süddeutsche Zeitung reported that law enforcement agencies in Germany had launched a series of raids targeting one of the country's major banks, Commerzbank, in a tax evasion investigation that authorities said could lead to criminal charges against employees of Mossack Fonseca.
In Brazil, the firm has become a target in an investigation of bribery and money laundering called "Operation Car Wash" (Lava Jato, in Portuguese), which has led to criminal charges against prominent politicians and an investigation to the popular former president Luiz Inácio Lula da Silva. The scandal threatens to remove current president Dilma Rousseff from office.
In January, Brazilian prosecutors called Mossack Fonseca a "great money launderer" and announced that they would file criminal charges against five employees of the firm's office in Brazil for their roles in the scandal.
Mossack Fonseca denies having broken the law in Brazil. One of its owners, the Panamanian Ramón Fonseca Mora, insisted in recent weeks in his innocence. But at the same time he had to resign office as an Advising Minister of the Government of Panama and as head of the Panameñista party, which led Juan Carlos Varela to the Presidency.
"We are totally innocent of the charges against us," he told the media last month. "I ask for this license to defend my honor, my firm and my country."
(*) The Venezuelan team is made up of Ahiana Figueroa, Alfredo Meza, César Batiz, Ewald Scharfenberg, Fabiola Zerpa, Joseph Poliszuk, Katherine Pennacchio, Laura Weffer, Lisseth Boon, Roberto Deniz, and Ronna Rísquez.
Adrián Perdomo Mata has just entered the list of sanctioned entities of the US Department of the Treasury, as president of Minerven, the state company in charge of exploring, exporting and processing precious metals, particularly gold from the Guayana mines. His arrival in office coincided with the boom in exports of Venezuelan gold to new destinations, like Turkey, to finance food imports. Behind these secretive operations is the shadow of Alex Saab and Álvaro Pulido, the main beneficiaries of the sales of food for the Local Supply and Production Committee (Clap). Perdomo worked with them before Nicolás Maduro placed him in charge of the Venezuelan gold.
Gassan Salama, a Palestinian-cause activist, born in Colombia and naturalized Panamanian, frequently posts messages supporting the Cuban and Bolivarian revolutions on his social media accounts. But that leaning is not the main sign to doubt his impartiality as an observer of the elections in Venezuela, a role he played in the contested elections whereby Nicolás Maduro ratified himself as president. In fact, Salama, an entrepreneur and politician who has carried out controversial searches for submarine wrecks in Caribbean waters, found his true treasure in the main social aid and control program of Chavismo, the Clap, for which he receives millions of euros.
While the key role of Colombian entrepreneurs Alex Saab Morán and Álvaro Pulido Vargas in the import scheme of Nicolás Maduro’s Government program has come to light, almost nothing has been said about the participation of the traders who act as suppliers from Mexico. These are economic groups that, even before doing business with Venezuela, were not alien to public controversy.
Even though there are new brands, a new physical-chemical analysis requested by Armando.Info to UCV researchers shows that the milk powder currently distributed through the Venezuelan Government's food aid program, still has poor nutritional performance that jeopardizes the health of those who consume it. In the meantime, a mysterious supplier manages to monopolize the increasing imports and sales from Mexico to Venezuela.
Two entrepreneurs from Peru, Yosef Maiman and Sabih Saylan, participated as intermediaries in the irregular payments of Odebrecht, through offshore structures, to the former president of that country. They are part of a "shell companies" structure built by Mossack Fonseca, as shareholders of the private cable TV and telephone operator in Venezuela, Inter. Even the Panamanian law firm suspected that it was being used for money laundry. Meanwhile, another firm of the group contracted works with the Chavista State.
Turkey and the coastal emirates of the Arabian Peninsula are now the homes of companies that supply the main social -and clientelist- program of the Government of Venezuela. Although the move from Mexico and Hong Kong, seems geographically epic, the companies has not changed hands. They are still owned by Colombian entrepreneurs Alex Nain Saab Morán and Álvaro Pulido Vargas, who control since 2016 a good part of the Import of food financed with public funds. Around the world for a business.
When Vice President Delcy Rodríguez turned to a group of Mexican friends and partners to lessen the new electricity emergency in Venezuela, she laid the foundation stone of a shortcut through which Chavismo and its commercial allies have dodged the sanctions imposed by Washington on PDVSA’s exports of crude oil. Since then, with Alex Saab, Joaquín Leal and Alessandro Bazzoni as key figures, the circuit has spread to some thirty countries to trade other Venezuelan commodities. This is part of the revelations of this joint investigative series between the newspaper El País and Armando.info, developed from a leak of thousands of documents.
Leaked documents on Libre Abordo and the rest of the shady network that Joaquín Leal managed from Mexico, with tentacles reaching 30 countries, ―aimed to trade PDVSA crude oil and other raw materials that the Caracas regime needed to place in international markets in spite of the sanctions― show that the businessman claimed to have the approval of the Mexican government and supplies from Segalmex, an official entity. Beyond this smoking gun, there is evidence that Leal had privileged access to the vice foreign minister for Latin America and the Caribbean, Maximiliano Reyes.
The business structure that Alex Saab had registered in Turkey—revealed in 2018 in an article by Armando.info—was merely a false start for his plans to export Venezuelan coal. Almost simultaneously, the Colombian merchant made contact with his Mexican counterpart, Joaquín Leal, to plot a network that would not only market crude oil from Venezuelan state oil company PDVSA, as part of a maneuver to bypass the sanctions imposed by Washington, but would also take charge of a scheme to export coal from the mines of Zulia, in western Venezuela. The dirty play allowed that thousands of tons, valued in millions of dollars, ended up in ports in Mexico and Central America.
As part of their business network based in Mexico, with one foot in Dubai, the two traders devised a way to replace the operation of the large international credit card franchises if they were to abandon the Venezuelan market because of Washington’s sanctions. The developed electronic payment system, “Paquete Alcance,” aimed to get hundreds of millions of dollars in remittances sent by expatriates and use them to finance purchases at CLAP stores.
Scions of different lineages of tycoons in Venezuela, Francisco D’Agostino and Eduardo Cisneros are non-blood relatives. They were also partners for a short time in Elemento Oil & Gas Ltd, a Malta-based company, over which the young Cisneros eventually took full ownership. Elemento was a protagonist in the secret network of Venezuelan crude oil marketing that Joaquín Leal activated from Mexico. However, when it came to imposing sanctions, Washington penalized D’Agostino only… Why?
Through a company registered in Mexico – Consorcio Panamericano de Exportación – with no known trajectory or experience, Joaquín Leal made a daring proposal to the Venezuelan Guyana Corporation to “reactivate” the aluminum industry, paralyzed after March 2019 blackout. The business proposed to pay the power supply of state-owned companies in exchange for payment-in-kind with the metal.
