Panama's President Juan Carlos Varela is among those publicly championing transparency, saying his government welcomes any investigation that protects its financial system from abuse. Will Fitzgibbon, a reporter for the International Consortium of Investigative Journalists that is leading the probe of documents from law firm Mossack Fonseca, told VOA illegal or morally suspicious activities were in the minority among the 220,000 companies in the documents. But he said even with a small percentage facilitating corruption or bribery, that for many advocates is enough to scrutinize the entire offshore system. "As Mossack Fonseca and others have told us in the industry, they work according to the laws of these nations, of Panama, of the British Virgin Islands, even of the United States, which has a very large offshore industry," Fitzgibbon said. "Therefore, the problem is even I think, according to many advocates, an issue of what is allowed by the laws of countries where these companies are created."
Denial of wrongdoing
Ramon Fonseca, one of the firm's co-founders, has strongly denied breaking any laws. He told the Associated Press that focus on the company is unfair and would not happen if it were based in the United States instead of Panama. Fitzgibbon said the documents were amazing in the number of "specific requests" companies and individuals made to create offshore companies in order to avoid paying taxes, as well as notices from governments writing to those companies to make those allegations.
People demonstrate against Iceland's Prime Minister Sigmundur Gunnlaugsson in Reykjavik, Iceland on April 4, 2016 after a leak of documents by so-called Panama Papers stoked anger over his wife owning a tax haven-based company.
The head of Switzerland's Credit Suisse, Tidjane Thiam, said Tuesday his firm only advocates clients use an offshore structure "when there is a legitimate economic purpose." Similarly, British banking giant HSBC said Tuesday it does not condone offshore activity for tax avoidance, and that allegations involving its clients predate its recent reforms. Credit Suisse agreed to pay the U.S. a $2.5 billion fine in 2014 for helping Americans evade taxes, while HSBC agreed in 2012 to pay $1.92 billion for its role in laundering drug money from Mexico.
Russian President Vladimir Putin attends a meeting with German Foreign Minister Frank-Walter Steinmeier at the Kremlin in Moscow, Russia
An ICIJ report Monday said the Mossack Fonseca documents included more than 500 banks registering 15,600 offshore companies. It said HSBC and its subsidiaries accounted for 2,300 of those shell companies, with Credit Suisse responsible for another 1,100. Those banks were also among a group that were given special arrangements by Mossack Fonseca that required less due diligence in documenting why clients wanted to create a shell company, ICIJ said, allowing the banks to be insulated from the deals.
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