The latest: Norwegian bank DNB regrets offshore actions

Associated Press

Monday, April 4, 2016 | 6:59 a.m.

BERLIN — The Latest on the publication by a coalition of media outlets of an investigation into offshore financial dealings by the rich and famous (all times local):

3:45 p.m.

The Norwegian bank DNB says it regrets having helped about 40 customers open offshore companies in the Seychelles with the help of Panamanian law firm Mossack Fonseca.

The bank says "that it was legal to set up this type of companies doesn't mean that it was correct for us to do it for these customers."

The bank was reacting to a report in Norwegian newspaper Aftenposten showing it had helped customers set up shell companies in the Seychelles to avoid taxes. The report was based on a massive leak of documents linked to the Panamanian law firm.

DNB said its subsidiary in Luxembourg helped set up the companies between 2006 and 2010. About 30 of them were owned by Norwegians. DNB said it has since amended its rules.

It says "this is a closed chapter for our operations in Luxembourg."

The Norwegian Tax Administration said it is trying to gain access to the leaked documents.

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3:10 p.m.

French Finance Minister Michel Sapin says his country will investigate the Panama Papers documents in order to recover money from those who might have committed tax evasion. Several hundred French citizens reportedly feature among the individuals mentioned.

Sapin says Monday that France will ask countries which had access to the documents for more information. Interior Minister Bernard Cazeneuve told Le Monde newspaper that France wants assistance from Australia, Britain and the United States.

Sapin says France has the legal tools to recover unpaid taxes "and to apply penalties" on those who hold unregistered bank accounts or shell companies abroad. He says Panama has been under the surveillance of French authorities for several years.

France says it recovered 2.65 billion euros ($3 billion) of unpaid taxes in 2015. On the 7,800 cases that year, 515 were connected to a shell company in Panama.

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2:30 p.m.

Italian weekly L'Espresso says about 1,000 Italian clients turned up in a database of offshore accounts cited in a media investigation, including Alitalia chairman Luca Cordero di Montezemolo.

L'Espresso said documents showed a series of contracts set up in 2007 indicated Montezemolo as the head of a Panama-based company named Lenville. It said Montezemolo, who was Fiat chairman and Ferrari CEO at the time, declined comment when contacted.

The weekly said the names of UniCredit and Ubi Banca also appeared. Espresso said that UniCredit used Panama-based firm Mossack Fonseca to manage 80 offshore companies, but said that the bank distanced itself in 2010. UniCredit said in a statement that Mossack Fonseca "did not appear as a financial consultant of the group."

L'Espresso said Ubi Banca appeared to be linked to some 40 offshore companies registered in Panama and the Seychelles. The bank responded that it has no subsidiaries or affiliates in either of those countries, adding "the group has always supported its clients in compliance with regulations currently in force."

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2:20 p.m.

The German government says it hopes for further pressure on offshore tax havens to improve transparency following the release of leaked documents from a Panamanian law firm.

Finance Ministry spokesman Martin Jaeger said Monday Berlin hopes that "the current debate" will contribute to increasing the pressure. He said that more has been achieved over the past three years than in the previous 30 but "what we are lacking ... is transparency. We must bring light into the darkness, we must illuminate this undergrowth."

Chancellor Angela Merkel's spokesman, Steffen Seibert, said: "For us it is clear that the international community's pressure on such countries as, possibly, Panama must remain high so that they take further steps in the area of creating transparency."

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2:15 p.m.

Slovenia's Delo newspaper says that according to documents it analyzed so far, at least 78 Slovenian companies and 74 Slovenian individuals are reportedly associated with companies set up through Mossack Fonseca.

It said Monday Slovenian UPC Consulting Group is one of the key Slovenian clients of the Panama-based consulting firm for registration of companies in tax havens. UPC has helped Slovenians and some other nationals register at least 17 companies, Delo writes.

Delo says that according to the documents, among the companies UPC helped register, all but one were set up in Anguilla, a British overseas territory in the Caribbean, where there are virtually no taxes. Delo did not give names of the companies nor the individuals.

UPC denied that that tax laws were violated in either Slovenia or elsewhere.

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2:10 p.m.

A Ukrainian lawmaker has called for impeachment proceedings against President Petro Poroshenko over the leaked documents from a Panamanian firm.

Oleh Lyashko, the leader of the Radical Party, said Monday the trove of data on offshore financial dealings revealed by an international media consortium has implicated Poroshenko in alleged abuse of office and tax evasion.

Lyashko urged lawmakers to initiate impeachment proceedings against the president. Poroshenko, whose faction has 136 seats in the 450-seat parliament, appears well protected from the motion, which requires a three-quarter majority to pass.

Poroshenko promised voters that he would sell his candy business when he was elected in 2014. But documents of the Panamanian firm indicated that he set up an offshore holding company and may have saved millions of dollars in Ukrainian taxes.

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1:30 p.m.

India's Finance Minister Arun Jaitley says that those who did not take advantage of a government compliance window last year to declare their illegal assets stashed abroad would find "such adventurism extremely costly."

He says that a recent media investigation, which details wide-spread use of offshore accounts by world leaders, executives and others, were "a stern reminder to all of us." Jaitley's comments were reported by the Press Trust of India news agency.

According to the new reports, the names of Indian superstars Aishwarya Rai Bachchan and Amitabh Bachchan feature among the more than 500 Indian with connections to offshore financial firms in Panama.

India's Prime Minister Narendra Modi has promised to prosecute those who evade taxes and to bring back money parked in tax havens but his government has made little progress on that front.

Having an offshore account or company is not necessarily illegal, but can be used to avoid or evade taxes.

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12:55 p.m.

The spokesman of Russian President Vladimir Putin says he is the "main target" of the media investigation into offshore accounts, but that he was not implicated in any wrongdoing.

The documents published by more than 100 media outlets alleged that Putin's friends, including a leading cellist, were engaged in an offshore scheme.

Putin's spokesman Dmitry Peskov says "it's obvious that the main target of such attacks is our president," and claimed that the publication was aimed at influencing Russia's stability and parliamentary elections scheduled for September.

Peskov said international media had wrongly focused on Putin instead of other world politicians, even though he was not implicated in any wrongdoing, and suggested the Washington-based International Consortium of Investigative Journalists, a key player in the publication, had ties to the U.S. government.

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12:50 p.m.

The French president says the leaked documents from a Panamanian law firm are "good news" because it will help the state to recover money from people who have committed tax evasion.

Francois Hollande, speaking to reporters during the visit of a tech company in the Paris suburb of Boulogne-Billancourt, says "the whistleblowers do a useful work for the international community; they're taking risks, so they must be protected."

Last year, the French tax administration recovered 12 billion euros ($ 13.6 billion) from people who had committed tax evasion or tax avoidance, according to the French president.

Regarding the French clients of the Panamanian firm Mossack Fonseca, "all the investigations will be made" and potential trials "will be held", Hollande says.

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11:35 a.m.

Nordea, the Nordic region's biggest bank, says it doesn't help wealthy customers evade taxes in response to reports linking it to the Panamanian law firm at the center of a media investigation into offshore accounts.

Swedish public broadcaster SVT, one of the hundreds of media with access to leaked documents detailing offshore accounts, says Nordea's private banking unit in Luxembourg worked with Panamanian firm Mossack Fonseca to help wealthy customers set up shell companies.

Nordea said Monday it follows and "all rules and regulations" and doesn't tolerate being used to evade taxes. It said its Luxembourg unit in 2009 started taking measures "in addition to those prescribed in laws and regulations or industry practices." Since then the number of customers "with these structures" has decreased, Nordea said.

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11:20 a.m.

A group representing current and former lawmakers from Southeast Asian countries says the trove of leaked documents shows how the wealthy and politically powerful have abused rules governing offshore tax havens, often to the detriment of their own communities.

The group, ASEAN Parliamentarians for Human Rights, is calling for governments in the region to crack down on large scale corporate tax evasion and pursue more equitable tax regimes.

Malaysian lawmaker Charles Santiago, who chairs the group, says multinational corporations and individuals evading tax should be hauled up in their respective countries.

He says, "Intermediaries, especially financial institutions, must be investigated and charged as well."

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10:50 a.m.

Russian media are keeping mum about the $2 billion found in offshore accounts linked to close friends of President Vladimir Putin.

An investigation published by an international coalition of more than 100 media outlets on Sunday details how politicians use banks, law firms and offshore shell companies to hide their assets. Putin's close friends including a cellist from St. Petersburg were shown to be engaged in a complex offshore scheme.

Following a leak from a Panamanian law firm, authorities in other countries said they would investigate the individuals mentioned for possible tax evasion.

In Russia, where the investigation was published by independent Novaya Gazeta, the so-called Panama Papers scandal faced an effective coverage ban. Russian television on Monday morning made no mention of the Panama scandal.

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8:45 a.m.

Japan's biggest security company, Secom Co., said Monday that it had disclosed to tax authorities all necessary information about the management of assets of its founders by a Panamanian law firm, Mossack Fonseca, at the center of an investigative report on offshore financial dealings.

Secom Co. said in a statement that it understood all services provided by Mossack Fonseca to Secom and to its director Makoto Iida and its late former director Juichi Toda were legal.

The Kyodo News Service is part of a media consortium that has published details of an investigation into offshore financial dealings by the rich and famous. It reported that Iida and Toda, who died in 2014, used offshore companies to manage their assets.

Separately, the National Tax Agency said it does not comment on individual cases.

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8:20 a.m.

The Australian Taxation Office says it is investigating more than 800 wealthy Australians for possible tax evasion linked to their dealings with a Panamanian law firm, Mossack Fonseca, which is one of the world's biggest creators of shell companies.

The investigation comes a day after the release by the Washington-based International Consortium of Investigative Journalism of details of a cache of 11.5 million records detailing offshore holdings of a dozen current and former world leaders, as well as businessmen, criminals, celebrities and sports stars.

Ramon Fonseca, a co-founder of Mossack Fonseca, confirmed to Panama's Channel 2 television network that the papers were authentic and had been illegally obtained through hacking.

The Australian Tax Office said in a statement that it had linked 120 out of 800 individual Australian taxpayers it found in the data to an unnamed associate offshore services provider in Hong Kong.