Panama Papers scandal "gets to the heart of our democracy", says whistleblower

One of the journalists who uncovered the Panama Papers scandal has appealed to MEPs to help "shed light" on the "parallel world" of offshore companies.

Mossack Fonseca logo | Photo credit: Press Association

By Martin Banks

Martin Banks is a senior reporter at the Parliament Magazine

27 Sep 2016


Speaking at a special hearing in Parliament on Tuesday, Bastian Obermayer said the scandal had shown the extent to which the rich and powerful sought to avoid tax.

Obermayer, a journalist at Munich-based newspaper Süddeutsche Zeitung, told the packed meeting the onus was now on politicians to act against such "wrongdoing." 

He said, "I hope the European Parliament will help shed more light on this parallel world. Some people, as our investigation showed, think they can evade tax. It is wrong and has to stop."


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The reporter, who is now based in Washington D.C., added, "This gets to the heart of our democracy. When this is at stake - and people are losing faith in democracy - it can give rise to populists and the xenophobic."

He was one of several journalists who worked on the Panama Papers case who were invited to explain how they went about their investigation to a special committee set up by Parliament.

The inquiry committee on Panama Papers is chaired by German MEP Werner Langen and will probe alleged contraventions of EU law in relation to money laundering and tax evasion and avoidance.

The Panama Papers were an unprecedented leak of 11.5 million files from the database of the world's fourth biggest offshore law firm, Mossack Fonseca. 

The records were obtained from an anonymous source by Süddeutsche Zeitung, which shared them with the International Consortium of Investigative Journalists (ICIJ). The ICIJ then shared them with a large network of international partners.

The documents show the myriad ways in which the rich can exploit secretive offshore tax regimes. Twelve national leaders are among 143 politicians, their families and close associates from around the world known to have been using offshore tax havens.

Speaking via a video link to the parliamentary hearing, Gerard Ryle, director of the US-based International Consortium of Investigative Journalists, said the Panama Papers revelations had "shocked the world."

He said the probe started when they were approached by a source who had access to "40 years of records" belonging to Mossack Fonseca.

Ryle said, "We assembled investigative journalists from 76 countries to work on the case. Not everything we uncovered was illegal but some 140 elected officials were implicated and it turned out to be the biggest data leak in history."

He added, "The job of journalists is to expose wrongdoing and it is now up to civil society and legislators like MEPs to decide what to do next."

Another speaker, Belgian journalist Kristof Clerix, of Knock Magazine, detailed how his title had sought to uncover Belgian links to the Panama Papers scandal.

He said they identified 732 Belgian citizens, many among the "richest families in the country, who were connected to 144 offshore companies. 

"Their preferred tax havens were in British Virgin Islands, Panama and the Seychelles," he said.

As a result of the publication's investigations, the Belgian tax authorities had now formally opened cases on 239 of the 732 cases, he said.

He told the hearing, "I want to take this opportunity to appeal to you to support whistleblowers. Without their efforts we would not be sitting here today talking about this."

His message was endorsed by committee Chair Langen, who said, "Improved protection for whistle blowers is an important objective. 

"We have to improve conditions for whistleblowers. Without the data that was uncovered by the work of these people we have heard at this hearing today, it would not be possible to make progress on the issue of tax justice."

 

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