World leaders rush to limit harm from Pandora Papers

NEW YORK • World leaders are on the defensive after the release of millions of documents detailing how heads of state use offshore tax havens to stash assets worth hundreds of millions of dollars.

Thirty-five current and former leaders are featured in roughly 11.9 million documents leaked from financial services companies that include reports of luxury mansions on the French Riviera and in Monte Carlo and California.

The so-called Pandora Papers were obtained by the International Consortium of Investigative Journalists (ICIJ) and released in stories by media partners including The Washington Post, the BBC and The Guardian.

Allegations range from corruption to money laundering and tax evasion.

Holding assets offshore or using shell companies is not illegal in most countries, but the revelations are embarrassing for leaders who have pushed austerity measures or campaigned against corruption.

While Russian leader Vladimir Putin is not named, he is linked via associates to secret assets in Monaco, including a waterfront home acquired by a Russian woman reported to have had a child with him.

"This is just a set of largely unsubstantiated claims," said Kremlin spokesman Dmitry Peskov on Monday. "We didn't see anything on hidden wealth within Putin's inner circle."

Ukraine's President Volodymyr Zelensky, who has been vocal on anti-corruption issues, used a network of offshore companies to buy three upmarket properties in London, the ICIJ revealed.

His office said on Monday it had been a way of protecting himself against the "aggressive actions" of the regime of his predecessor, the pro-Russia president Viktor Yanukovich.

Jordan rejected "distorted" reports that King Abdullah II created a network of offshore companies and tax havens to amass a US$100 million (S$130 million) property empire stretching from California to London.

King Abdullah did not directly address the issue but denounced what he called a "campaign against Jordan", a royal court statement quoted him as saying to a group of tribal elders. He added: "We have nothing to hide."

The country's royal court said the properties were funded with the king's personal wealth and used for official and private visits.

Ivory Coast Prime Minister Patrick Achi's office denounced the "malicious use" of information after it emerged that he had become the owner of Bahamas-based company Allstar Consultancy Services through a trust that obscured his ownership.

His office said the information dated back to the late 1990s when he was an adviser to Ivory Coast's energy minister.

Kenyan President Uhuru Kenyatta appeared to welcome the papers, which he said would "enhance financial transparency". However, he sidestepped allegations that his family owned 11 offshore companies worth millions of dollars.

Ecuador's President Guillermo Lasso defended himself after revelations that he had lodged funds in two trusts based in the United States. "All my revenue has been declared and I have paid the corresponding tax in Ecuador," he said.

The ICIJ found links between almost 1,000 companies in offshore havens and 336 high-level politicians and public officials. Among them were more than a dozen serving heads of state and government, country leaders, Cabinet ministers and ambassadors.

More than two-thirds of the companies were set up in the British Virgin Islands.

Nearly two million of the 11.9 million leaked documents came from a Panamanian law firm called Alcogal, which has rejected accusations of shady dealings.

ICIJ's director Gerard Ryle said in a video accompanying the investigation that those best placed to halt such practices were the ones benefiting the most.

Transparency International's Maira Martini called for an end to the offshore industry, saying the investigation once more offered "clear evidence" of how it "promotes corruption and financial crime".

The Pandora Papers are the latest in a series of mass leaks handled by the ICIJ - from LuxLeaks in 2014, to the 2016 Panama Papers. They were followed by the Paradise Papers in 2017 and FinCen files last year.

AGENCE FRANCE-PRESSE