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Abu Dhabi, UAEFriday 14 December 2018

'Panama Papers' law firm that exposed offshore rogue finance industry to shutdown

Mossack Fonseca is shutting down due to the reputational fallout from its involvement in global tax evasion

The Panama Papers leaked documents showed three Syrian companies that were sanctioned by the US for their alleged involvement in supplying the regime of president Bashar Al Assad, had used the services of Panama-based law firm Mossack Fonseca to create shadow companies in the Seychelles. EPA
The Panama Papers leaked documents showed three Syrian companies that were sanctioned by the US for their alleged involvement in supplying the regime of president Bashar Al Assad, had used the services of Panama-based law firm Mossack Fonseca to create shadow companies in the Seychelles. EPA

Mossack Fonseca, the Panamanian law firm at the center of the “Panama Papers” scandal, said on Wednesday it was shutting down due to the economic and reputational damage inflicted by its role in the global tax evasion debacle.

The so-called Panama Papers, which consist of millions of documents stolen from Mossack Fonseca and leaked to the media in April 2016, provoked a global scandal after showing how the rich and powerful used offshore corporations to evade taxes.

“The reputational deterioration, the media campaign, the financial circus and the unusual actions by certain Panamanian authorities, have occasioned an irreversible damage that necessitates the obligatory ceasing of public operations at the end of the current month,” the firm said in a statement.

Mossack Fonseca said a skeleton staff would remain in order to comply with requests from authorities and other public and private groups.

Nonetheless, the law firm said it would continue “fighting for justice,” adding it would continue to cooperate with authorities.

Last month, Panamanian prosecutors raided the offices of Mossack Fonseca, seeking possible links to Brazilian engineering company Odebrecht. The Brazilian construction firm has admitted to bribing officials in Panama and other countries to obtain contracts in the region between 2010 and 2014.

Ramon Fonseca, a partner at Mossack Fonseca, denied last month that his firm had a connection to Odebrecht, while accusing Panamanian President Juan Carlos Varela of directly receiving money from Odebrecht, Latin America’s largest engineering company.

Mr Varela has denied that he took any money from Odebrecht.