By Pam Martens and Russ Martens: July 29, 2016
Attorney General Loretta Lynch of the U.S. Department of Justice
The Wall Street Journal reported yesterday that the U.S. Department of Justice in Washington D.C. and its U.S. Attorney’s office in Manhattan “have launched a criminal investigation into whether individuals at Mossack Fonseca & Co., the law firm at the center of the ‘Panama Papers’ scandal, knowingly helped its clients launder money or evade taxes…”
That investigation, if conducted thoroughly and without improper interference, could turn up the heat on some powerful Wall Street players.
On May 16 Wall Street On Parade broke the story that the Miami office of Citigroup’s Private Bank at 201 South Biscayne Blvd. was the listed address for dozens of offshore companies whose agent is Mossack Fonseca. (See graph below.) Our information was obtained from a search of the public database made available by the International Consortium of Investigative Journalists (ICIJ), which received more than 11.5 million leaked files from the Panama-based law firm, Mossack Fonseca. ICIJ calls Mossack Fonseca “one of the world’s top creators of hard-to-trace companies, trusts and foundations.”
Prior to Citigroup’s implosion and bailout in 2008, it reported its major subsidiaries to the Securities and Exchange Commission. In this report from 2006, Citigroup showed more than 1600 major subsidiaries with more than five dozen in secrecy jurisdictions. As Citigroup came under serial investigations by the Justice Department and other Federal regulators, its list of subsidiaries shrank dramatically. But as we reported in 2014, that doesn’t mean the subsidiaries are actually gone – many are simply just not listed any longer in an out-of-sight-out-of-mind kind of operation.
Wall Street hedge funds may also come under the microscope. Hedge fund titans have turned up in the Panama Papers database or earlier leaked documents that are now part of the ICIJ database.
Internationally known hedge fund billionaire mogul, George Soros, turned up in the Panama Papers. His name is linked to Soros Holdings Limited, whose agent is Mossack Fonseca, with the British Virgin Islands listed as its registration. Another company tied to Soros is Soros Finance Inc., which shows registration in Panama and also shows Mossack Fonseca as its agent.
Another hedge fund mogul, S. Donald Sussman, founder of Paloma Partners, appears in the ICIJ offshore database from a document leak in 2013. Both he and his hedge fund are shown connected to a company called Simply Radiant Limited. The company was registered in the British Virgin Islands. Its agent is listed as Portcullis Trustnet.
Another hedge fund billionaire in the ICIJ database is David E. Shaw. Three entities tied to Shaw turn up in the earlier leaked documents: an account in the name of David E. Shaw, a Shaw Family Trust I, and Mid Ocean Company.
The U.S. Public Interest Research Group (USPIRG) notes that “while not all of the transactions and accounts arranged by the [Mossack Fonseca] firm were illegal, many helped extremely wealthy individuals dodge billions of dollars in taxes through the use of offshore ‘shell’ companies and other methods.” ICIJ has noted that 36 Americans implicated in fraud or other financial crimes show up in the database.
Soros, Sussman and Shaw are among the largest donors to the SuperPac supporting Hillary Clinton, Priorities USA.
Citigroup Ties to Panama Papers
