“They do not want to disclose details”: Contact report Sequoia Treuhand Trust Reg, Dolan Laurence, March 6, 2013.
the former Siemens representative who was a major Bank Rossiya shareholder: Jack Stubbs, Andrey Kuzmin, Stephen Grey, and Roman Anin, “The Man Who Married Putin’s Daughter and Then Made a Fortune,” Reuters, December 17, 2015, http://www.reuters.com/investigates/special-report/russia-capitalism-shamalov/.
earning at least $4 million from them between 2008 and 2011: Jake Bernstein, Petra Blum, Oliver Zihlmann, David Thompson, Frederik Obermaier, and Bastian Obermayer, “All Putin’s Men: Secret Records Reveal Money Network Tied to Russian Leader,” International Consortium of Investigative Journalists, April 3, 2016, https://panamapapers.icij.org/20160403-putin-russia-offshore-network.html.
worth about $10 million a year in dividends to Roldugin: Ibid.
Direct investment by Russians in the BVI during this period increased eightfold: “Russians Park Money in British Virgin Islands,” Wall Street Journal, August 16, 2013, http://blogs.wsj.com/emergingeurope/2013/08/16/russians-park-money-in-british-virgin-islands/?mg=id-wsj.
when the U.S. Treasury Department sanctioned the brothers: “Treasury Sanctions Individuals and Entities for Sanctions Evasion and Other Activities Related to Russia and Ukraine,” U.S. Department of the Treasury, December 22, 2015, https://www.treasury.gov/press-center/press-releases/Pages/jl0314.aspx.
In 2016, Arkady Rotenberg placed first on the Forbes list: Roman Anin, Olesya Shmagun, and Dmitry Velikovskiy, “The Secret Caretaker,” Organized Crime and Corruption Reporting Project, April 3, 2016, https://www.occrp.org/en/panamapapers/the-secret-caretaker/; and Bernstein et al., “All Putin’s Men.”
the younger Shamalov, barely thirty, managed to borrow about $1.3 billion: Stubbs et al., “The Man Who Married Putin’s Daughter and Then Made a Fortune.”
Russia has a GDP per capita of about $9,000: Julia Ioffe, “What Russia’s Latest Protests Mean for Putin,” Atlantic, March 27, 2017, https://www.theatlantic.com/international/archive/2017/03/navalny-protests-russia-putin/520878/.
the owners simply changed its name to MV Nerei: Anna Astakhova, “For the sake of maximizing profit from transportation, shipowners turned Russian seamen into slavery,” Top Secret, June 3, 2015. Translated from Russian via Google Translate, https://www.sovsekretno.ru/articles/id/4824/.
The owners declared bankruptcy: “Database on Reported Incidents of Abandonment of Seafarers,” International Labour Organization, December 19, 2016, http://www.ilo.org/dyn/seafarers/seafarersBrowse.details?p_lang=en&p_abandonment_id=194&p_search_id=130718104745; and “Thirteen Seafarers Stuck on Abandoned Ship Appeal for Help,” Officer of the Watch, June 26, 2013, https://officerofthewatch.com/2013/06/26/thirteen-seafarers-stuck-on-abandoned-ship-appeal-for-help/.
were detained but to date have avoided trial or prison: “Former deputy Gleb Klokov used slave labor?,” Translated from Russian via Google Translate, VladNews, April 22, 2013, http://vladnews.ru/2013/04/22/66986.html; “Suspected of using slave labor sailors on SS Veles taken in custody in Vladivostok,” Translated from Russian via Google Translate, PortNews, April 22, 2013, http://xn—m1abcfge5eq.xn—p1ai/news/print/159116/.
8: THE ART OF SECRECY
The art trade in Switzerland is a multibillion-dollar business: Rachel A. J. Pownall, TEFAF Art Market Report 2017, European Fine Art Foundation (2017), p. 57, http://1uyxqn3lzdsa2ytyzj1asxmmmpt.wpengine.netdna-cdn.com/wp-content/uploads/2017/03/TEFAF-Art-Market-Report-20173.pdf.
the Geneva Freeport, more than 600,000 square feet of storage space: “Ports francs et entrepôts douaniers ouverts,” Contrôle fédéral des finances (CDF), January 28, 2014, p. 34.
1.2 million pieces of art: Pownall, TEFAF Art Market Report 2017, p. 68.
everything from Roman antiquities to an estimated one thousand Picassos: Graham Bowley and Doreen Carvajal, “One of the World’s Greatest Art Collectors Hides Behind This Fence,” New York Times, May 28, 2016, https://www.nytimes.com/2016/05/29/arts/design/one-of-the-worlds-greatest-art-collections-hides-behind-this-fence.html.
conservatively valued at more than $100 billion: Koltrowitz and Arnold, “Freeports Boom Highlights Risks of Shady Activities.”
In 2016, Italian police pried open crates: Nick Squires, “Disgraced British Art Dealer’s Priceless Treasure Trove Hidden in Geneva,” Telegraph, February 1, 2016, http://www.telegraph.co.uk/news/worldnews/europe/switzerland/12134541/Disgraced-British-art-dealers-priceless-treasure-trove-discovered-hidden-in-Geneva.html.
Worldwide the art trade is valued at $30 billion annually: Pownall, TEFAF Art Market Report 2017, p. 26.
more than half of all art sales are private: Clare McAndrew, TEFAF Art Market Report 2015, European Fine Art Foundation (2015), p. 36, http://tbamf.org.uk/wp-content/uploads/2015/03/TEFAF2015.pdf.
Today more than 65 percent of the articles stored in the Geneva Freeport are art and antiques: Geneva Free Ports and Warehouses Limited, “Second Update,” press conference presentation, June 8, 2016, http://geneva-freeports.ch/files/8714/7392/8901/dossier_presse_uk.pdf.
76 percent of collectors purchased art: Ibid.
prompted his friends to nickname him “Farouk”: Susan Adams, “The Art of the Deal,” Forbes, December 7, 2007, https://www.forbes.com/forbes/2007/1224/080.html.
an ostentatiously wealthy Egyptian ruler: Paul Crompton, “King Farouk’s Fabulous Wealth,” Al Arabiya News, January 30, 2014, http://english.alarabiya.net/en/perspective/features/2014/01/30/King-Farouk-s-fabulous-wealth-1977.html.
Joe Nahmad was willing, on occasion, to push the limits of the law: Adams, “The Art of the Deal.”
the three brothers gained a reputation: Ibid.
Russian gambling ring run out of New York’s Trump Tower: James Glanz, Randy Kennedy, and William K. Rashbaum, “Case Casts Harsh Light on Family Art Business,” New York Times, May 16, 2013, http://www.nytimes.com/2013/05/17/arts/design/helly-nahmad-gallery-owner-indicted-in-gambling-case.html.
purchasing the pastel Danseuses by Edgar Degas: Jake Bernstein, “The Art of Secrecy,” International Consortium of Investigative Journalists, April 7, 2016, https://panamapapers.icij.org/20160407-art-secrecy-offshore.html.
purchased an oil painting at auction at Christie’s for $3.2 million: Nathaniel Herzberg (trans. Barbara Banks), “‘Panama Papers’: A Clearer Picture on the Hidden Modigliani,” Le Monde, May 27, 2016, http://www.lemonde.fr/panama-papers/article/2016/05/27/panama-papers-a-clearer-picture-on-the-hidden-modigliani_4927569_4890278.html.
too young to have purchased the painting as claimed by Christie’s: Ibid.
“an art world ambulance chaser”: Michael Kaplan, “This ‘Holocaust Hustler’ Makes a Living Off of Nazi-Stolen Art,” New York Post, July 2, 2016, http://nypost.com/2016/07/02/this-holocaust-hustler-makes-a-living-off-of-nazi-stolen-art/.
as much as $170 million: Robin Pogrebin and Scott Reyburn, “With $170.4 Million Sale at Auction, Modigliani Work Joins Rarefied Nine-Figure Club,” New York Times, November 9, 2015, https://www.nytimes.com/2015/11/10/arts/with-170-4-million-sale-at-auction-modigliani-work-joins-rarefied-nine-figure-club.html.
“IAC did not have a corporate identity independent of its individual owner”: Judge Eileen Bransten, Court Transcript, Maestracci, Philippe, v. Helly Nahmad Gallery, Inc., Supreme Court of the State of New York, April 24, 2017.
paintings by the likes of Picasso, Paul Cézanne, and Gustav Klimt: Juliette Garside, Jake Bernstein, and Holly Watt, “How Offshore Firm Helped Billionaire Change the Art World for Ever,” Guardian, April 7, 2016, https://www.theguardian.com/news/2016/apr/07/panama-papers-joe-lewis-offshore-art-world-picasso-christies.
A high-powered subsection of cultural New York: Carol Vogel, “Prized Picasso Leads the Ganz Collection to a Record Auction of $206 Million,” New York Times, November 11, 1997, http://www.nytimes.com/1997/11/11/arts/prized-picasso-leads-the-ganz-collection-to-a-record-auction-of-206-million.html.
Basil’s death in 1994: M
ichael Moschos, “Obituary: Basil Goulandris,” Independent, May 5, 1994, http://www.independent.co.uk/news/people/obituary-basil-goulandris-1433953.html.
Chowaiki decided to give financial backing to the legal effort: Kelly Crow, “The $3 Billion Family Art Feud,” Wall Street Journal, June 30, 2016, https://www.wsj.com/articles/the-3-billion-family-art-feud-1467326777.
Talara Holdings also put up a Chagall, Le violoniste bleu: “Marc Chagall—Le Violoniste Bleu,” Sotheby’s Impressionist and Modern Art Day Sale, May 6, 2015, http://www.sothebys.com/en/auctions/ecatalogue/2015/impressionist-modern-art-day-sale-n09341/lot.141.html.
“an elegy for a lost Golden Age”: “Paul Gauguin—Mata Mua (In Olden Times),” Museo Thyssen-Bornemisza, https://www.museothyssen.org/en/collection/artists/gauguin-paul/mata-mua-olden-times.
housed more than a thousand paintings: Jonathan Kandell, “Baron Thyssen-Bornemisza, Industrialist Who Built Fabled Art Collection, Dies at 81,” New York Times, April 28, 2002, http://www.nytimes.com/2002/04/28/nyregion/baron-thyssen-bornemisza-industrialist-who-built-fabled-art-collection-dies-81.html.
the baron’s artworks were divided among thirty to forty companies: Rafael Méndez, “Borja Thyssen usó una sociedad en Nevada para manejar cuentas bancarias en Andorra,” El Confidencial, September 4, 2016, http://www.elconfidencial.com/economia/papeles-panama/2016-04-09/borja-thyssen-cuentas-andorra-mossack-fonseca_1176959/.
masking her purchases through offshore companies as her husband did: Mar Cabra and Michael Hudson, “Mega-Rich Use Tax Havens to Buy and Sell Masterpieces,” International Consortium of Investigative Journalists, April 3, 2013, https://www.icij.org/offshore/mega-rich-use-tax-havens-buy-and-sell-masterpieces.
she split the company with Borja: Ángeles García, “Las cuentas secretas de los Thyssen,” El País, October 8, 2011, http://elpais.com/diario/2011/10/08/revistasabado/1318024801_850215.html.
complained that all her liquidity is tied up in paintings: Chris Hastings, “Art Expert Quits Museum in Fury at £25m Constable Sale,” Daily Mail, June 30, 2012, http://www.dailymail.co.uk/news/article-2167024/Art-expert-quits-museum-fury-25m-Constable-sale—Baroness-responsible-insists-needs-money-despite-homes-125ft-yacht-700m-art-collection.html.
The Constable painting fetched $34 million: Cabra and Hudson, “Mega-Rich Use Tax Havens to Buy and Sell Masterpieces.”
9: THE VIKINGS LOSE THEIR FERRARIS
The nation’s three leading banks had ballooned: Charles Forelle, “As Banking ‘Fairy Tale’ Ends, Iceland Looks Back to the Sea,” Wall Street Journal, October 10, 2008, https://www.wsj.com/articles/SB122359763876821355.
$403,000 per man, woman, and child: Roger Boyes, Meltdown Iceland: Lessons on the World Financial Crisis from a Small Bankrupt Island (New York: Bloomsbury USA, 2009), p. 144.
Joly had taken a job with the Norwegian Agency for International Development: “Investigating Iceland’s Financiers,” Financial Times, November 13, 2009, https://www.ft.com/content/b4979f3a-cf2a-11de-8a4b-00144feabdc0.
Iceland was small enough where one could discover the real truth: Author interview with Eva Joly, Brussels, September 2016.
the scale of the crisis screamed for a response: Author interview with Ólafur Hauksson, Iceland, September 2016.
Landsbanki, which held the deposits of one in three Icelanders: Thor Bjorgolfsson, Billions to Bust and Back: How I Made, Lost and Rebuilt a Fortune (London: Profile Books, 2015), p. 214.
took out loans to fund a nationwide buying binge: Boyes, Meltdown Iceland, p. 90.
A father-and-son team: Bjorgolfsson, Billions to Bust and Back, p. 3.
“Like this we could provide our services much faster”: Email from Jost Dex to MF&Co Legal Department, September 16, 2004.
the rating agency Fitch issued a negative grade for Iceland’s economy: “Fitch Ratings Revises Iceland’s Outlook to Negative,” Central Bank of Iceland, February 21, 2006, http://www.cb.is/publications/news/news/2006/02/21/Fitch-Ratings-revises-Icelands-outlook-to-negative-/.
Landsbanki lent its own board members 40 billion kronur: Boyes, Meltdown Iceland, p. 160.
fraudulently boosting the bank’s share price: “Sigurjón Þ. Árnason Sentenced to Three and a Half Years in Prison in the Ímon Case,” Kjarninn, October 8, 2015, https://translate.google.com/translate?hl=en&sl=is&u=http://kjarninn.is/frettir/sigurjon-th-arnason-daemdur-i-thriggja-og-halfs-ars-fangelsi-i-imon-malinu/&prev=search.
Sheikh Mohammed bin Khalifa al-Thani, an investor from Qatar: Sigrún Davíðsdóttir, “The Al Thani Story Behind the Kaupthing Indictment (Updated),” Sigrún Davíðsdóttir’s Icelog, February 23, 2012, http://uti.is/2012/02/the-al-thani-story-behind-the-kaupthing-indictment/.
a fraud perpetrated by Kaupthing: Ibid.
Unemployment jumped from 2 percent to 10 percent in six months: Boyes, Meltdown Iceland, p. 187.
Born into a well-to-do Jersey family: Bibi van der Zee, “Holy Cow, Taxman! Featherweight Activist Battles the Dodgers,” Guardian, July 7, 2011, https://www.theguardian.com/business/2011/jul/07/interview-john-christensen-tax-justice-network.
with the goal of researching the industry from the inside to expose its flaws: Author interview with John Christensen, January 2017.
to reveal the most prolific purveyors of financial secrecy: “And the Losers Are…,” Tax Justice Network, October 31, 2009, http://taxjustice.blogspot.com/2009/10/and-losers-are.html.
The release of the first index created a stir: “Financial Secrecy Index—What the Papers Said,” Tax Justice Network, November 6, 2009, http://taxjustice.blogspot.com/2009/11/financial-secrecy-index-what-papers.html.
the Sovereign Society was responsible for at least sixty-nine Mossfon companies: Kevin G. Hall, “Sovereign Society Fed Clients to Panama Papers Law Firm,” McClatchy, June 1, 2016, http://www.mcclatchydc.com/news/nation-world/national/article80981417.html.
“Secure your wealth with an 82-year-old, proven, virtually 100% courtroom-proof structure”: Sovereign Society, “The Most Effective Way to Build a ‘Permanent Total Wealth Portfolio,’” March 15, 2008.
the Sovereign Society held a four-day conference at a swank resort in Bermuda: Matt Collins, “Mastering the Media Machine: Give ’Em the Story,” Sovereign Society, March 20, 2009.
“But beware!!!”: Email from Ramsés Owens to Aurie Escobar, April 13, 2009.
An American real estate tycoon: William Raymond Ponsoldt, Contact Report, Egbert Wetherborne, February 14, 2011.
federal prosecutors indicted Lockard for bank fraud and conspiracy: Indictment, United States of America v. Lance Lockard et al., U.S. District Court for the District of Alaska, Case 3:07-cr-00148-RRB, December 17, 2008.
“I want to know the entire history of this client”: Email from Jürgen Mossack to Ramsés Owens et al., June 19, 2008, translated from original Spanish by author.
10: COMBING THE MONSTER
Birkenfeld and his colleagues had often traveled to America: CBS News, “Banking: A Crack in the Swiss Vault,” December 30, 2009, http://www.cbsnews.com/news/banking-a-crack-in-the-swiss-vault/.
UBS bankers visited around thirty-eight hundred American clients: Lisa Jucca, “How the U.S. Cracked Open Secret Vaults at UBS,” Reuters, April 9, 2010, http://www.reuters.com/article/us-banks-ubs-idUSTRE6380UA20100409.
“everyone who is attacking Swiss bank secrecy”: Speech by Hans-Rudolf Merz, March 18, 2008. https://www.parlament.ch/en/ratsbetrieb/amtliches-bulletin/amtliches-bulletin-die-verhandlungen?SubjectId=13870.
In 2016, the Swiss changed their law to create a “serious tax offense”: Bernhard Lötscher and Axel Buhr, “Tax Fraud to Become Predicate Offence to Money Laundering,” International Law Office, August 31, 2015, http://www.internationallawoffice.com/Newsletters/White-Collar-Crime/Switzerland/CMS-von-Erlach-Poncet-Ltd/Tax-fraud-to-become-predicate-offence-to-money-laundering.
Kassim Tajideen, for being a financial contributor to Hizballah: U.S. Department of the Treasury, “Treasury Targets Hizballah Financial Network,” December 9, 2010
, https://www.treasury.gov/press-center/press-releases/Pages/tg997.aspx.
the fund paid no UK taxes during thirty years of operation: Juliette Garside, “Fund Run by David Cameron’s Father Avoided Paying Tax in Britain,” Guardian, April 4, 2016, https://www.theguardian.com/news/2016/apr/04/panama-papers-david-cameron-father-tax-bahamas.
Mossfon’s production had fallen by 82 percent: Rigoberto Carvajal, analysis for author.
Société Général switched the shareholders of the companies: Email from Jost Dex to Mossfon Trust Corporation, February 25, 2009.
“NOT their final clients … UNBELIEVABLE!”: Email from Chris Zollinger to Adrian Simon, et al., September 30, 2010.
Zeller had come from a state-owned cantonal bank: https://www.credit-suisse.com/ch/en/about-us/governance/people/alexandre-zeller.html.
had repeatedly failed to live up to its obligations: Mark P. Sullivan, “Venezuela: Political Conditions and U.S. Policy,” Congressional Research Service, July 28, 2009, https://fas.org/sgp/crs/row/RL32488.pdf.
President Hugo Chávez’s chief bodyguard and his wife: Tamoa Calzadilla, “Un matrimonio cercano a Chávez terminó con empresas en paraísos fiscales y cuenta en Suiza,” Univision, April 1, 2016, http://www.univision.com/noticias/papeles-de-panama/un-matrimonio-cercano-a-chavez-termino-con-empresas-en-paraisos-fiscales-y-cuenta-en-suiza; and Alfredo Meza, “Adrián Velásquez: El edecán de Chávez que puso su dinero a buen resguardo,” Panama Papers Venezuela, March 30, 2016, http://panamapapersvenezuela.com/adrian-velasquez/.
when a friend asked, “I have clients who have cash”: Stéphane Joahny, “‘Virus’ rebondit au Maroc,” Le Journal du Dimanche, November 3, 2012, updated June 19, 2017, http://www.lejdd.fr/Societe/Actualite/L-affaire-Virus-rebondit-au-Maroc-573163.
a century-old inheritance stashed at HSBC in Switzerland: John Lichfield, “The Assistant Mayor, the Swiss Bank Accounts and the €350,000 of Moroccan Drugs Money,” Independent, October 14, 2002, http://www.independent.co.uk/news/world/europe/the-assistant-mayor-the-swiss-bank-accounts-and-the-350000-of-moroccan-drugs-money-8210969.html.
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