Financial Services ministry questions leak motive

Fri, May 13th 2016, 12:01 PM

The Ministry of Financial Services has taken a pugnacious stance on the so-called Panama Papers leak, charging that -- in the absence of more information -- the leak appears to be "a gratuitous attempt to convey a negative impression of The Bahamas as an international financial center (IFC)."

The ministry released a statement yesterday, questioning the publication by the International Consortium of Investigative Journalists (ICIJ) of the names of structures formed in The Bahamas and other IFCs.

As noted by the ministry, the publication came with a disclaimer which stated, "There are legitimate uses for offshore companies and trusts. We do not intend to suggest or imply that any persons, companies or other entities included in the ICIJ offshore leaks database have broken the law or otherwise acted improperly."

"The question comes to mind as to why publish a list at all? What is the motive? Without more the leak appears to be a gratuitous attempt to convey a negative impression of The Bahamas as an international financial center.

"Based on what has transpired thus far since the initial event it would appear that these leaks will take place intermittently over an extended period of time. Any leak of confidential information is unfortunate and potentially damaging. The uncertainty and sustained program of leaks is that much more serious," the statement said.

The 2.6 terabytes of data detail the dealings of Panama-based law firm Mossack Fonseca, which critics say specialized in helping clients park their money offshore. The documents outline the financial dealings of tens of thousands of clients, and the leak has led directly to the fall of world leaders and implicated others in all manner of dealings.

In the terse statement, the ministry contended that a justification was needed to explain the leak.

"That said, it is imperative that companies and the jurisdictions in which they operate, ensure that regulatory standards are adhered to, monitored and that they are enforced. "The Bahamas remains committed to international cooperation for its international compliance obligations and we continue to monitor the developments of this information leak," the ministry said.

Database
The Panama Papers database reveals the names of almost 320,000 companies and trusts dated 1977 to 2015. Currently, the database shows 15,946 offshore entities within The Bahamas. Each entity is also mapped to its intermediary and/or officer. Some countries that were frequently linked to The Bahamas include Hong Kong, Russia, Switzerland and the United Kingdom.

When searched by country, The Bahamas' results show 5,021 offshore entities, 1,593 officers, 122 intermediaries and 954 addresses. These results are offshore entities and intermediaries that were linked to The Bahamas from different jurisdictions such as the British Virgin Islands (BVI) and Panama. The world's top jurisdictions are BVI, Panama, The Bahamas, Seychelles and Samoa.

The online database adds a new twist to the ongoing investigations of the leaked papers. It was created for the ICIJ to gain more information from the public on the entities connected to the 11 million plus documents in the leak. Last week, the alleged whistleblower of the Panama Papers under the name "John Doe" wrote a manifesto explaining his actions.

"The Panama Papers provide a compelling answer to these questions: massive, pervasive corruption. And it's not a coincidence that the answer comes from a law firm. More than just a cog in the machine of "wealth management", Mossack Fonseca used its influence to write and bend laws worldwide to favor the interests of criminals over a period of decades," said the anonymous source.

"The prevailing media narrative thus far has focused on the scandal of what is legal and allowed in this system. What is allowed is indeed scandalous and must be changed. But we must not lose sight of another important fact: The law firm, its founders, and employees actually did knowingly violate myriad laws worldwide, repeatedly," the source added.

Click here to read more at The Nassau Guardian

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