Accused of illegally hiding tens of millions of dollars from the U.S. Internal Revenue Service (IRS), four men, including a former investment manager, a former U.S. resident, an American accountant and a Panamanian lawyer, are facing federal charges ranging from tax evasion to money laundering conspiracies. Associated with the Panama Papers scandal, each of the men worked for Mossack Fonseca & Co., a Panamanian-based global law firm, or related entities.
In April 2016, Iceland Prime Minister Sigmundur David Gunnlaugsson and Gonzalo Delaveau, the president of Transparency International in Chile, both immediately resigned from their positions after being named in the 11.5 million leaked documents known as the Panama Papers that listed the financial details of more than 200,000 offshore accounts created by Mossack Fonseca. Other prominent figures named in the Panama Papers include the father of former U.K. Prime Minister David Cameron, several friends of Russian President Vladimir Putin, the family of Chinese President Xi Jinping, cousins of Syrian President Bashar al-Assad, the family of former Pakistan Prime Minister Nawaz Sharif, the King of Saudi Arabia, Ukrainian President Petro Poroshenko, and Argentine President Mauricio Macri.
According to the recent 11-count indictment, Dirk Brauer, who worked as an investment manager for Mossfon Asset Management, S.A., an asset management company closely affiliated with Mossack Fonseca, and Ramses Owens, a Panamanian attorney who worked for Mossack Fonseca, helped their U.S. taxpayer clients conceal assets and investments by creating sham foundations and shell companies. By using debit cards and fictitious sales, their clients were able to repatriate their funds covertly.
Harald Von Der Goltz, a former U.S. resident now living in London, was one of Mossack Fonseca’s U.S. taxpayer clients. The Justice Department has charged him with conspiracy to commit tax evasion, wire fraud, money laundering conspiracy, willful failure to file an FBAR, and false statements.
Richard Gaffey, an accountant in Massachusetts, has been accused of assisting Von Der Goltz evade U.S. income taxes and reporting requirements while worked closely with Owens to help another U.S. taxpayer client of Mossack Fonseca to defraud the IRS. Gaffey faces many similar charges.
“Law firms, asset managers, and accountants play key roles enabling entry into the global financial system,” said Brian Benczkowski, Assistant Attorney General of the Criminal Division for the Justice Department. “The charges announced today demonstrate our commitment to prosecute professionals who facilitate financial crimes across international borders and the tax cheats who utilize their services.”
On Tuesday, Homeland Security Investigations (HIS) Special Agent-in-Charge Angel Melendez stated, “Today we announce the indictment of four individuals who allegedly defrauded the U.S. government through a large scale, intercontinental money laundering and wire fraud scheme, associated with Mossack Fonseca and its affiliates. HSI’s El Dorado Task Force, together with the IRS, built a case that uncovered an alleged complex trail of offshore shell corporations and bogus foundations used to disguise the beneficial ownership of huge amounts of money.”
According to the FBI, Brauer, Gaffey, and Von Der Goltz have been apprehended, while Owens remains at large. Owens faces a maximum sentence of 70 years in prison, Brauer faces 25 years, Gaffey faces more than 50 years, and Von Der Goltz over 60 years in federal prison.