The so-called Panama Papers reveal a secret network of holding companies designed to shield owners from public scrutiny. The anonymity afforded by these companies makes them prime vehicles for hiding dirty money.
Fusion and its media partners located at least 22 U.S. court cases that involve companies tied to Mossack Fonseca, the law firm that helped powerful clients across the world hide money in offshore companies — and whose internal documents comprised the Panama Papers leak. These are seven of the most salient Fusion reviewed. In most cases, the shell companies were used to carry out crimes. In others, there’s no way to know what the shells were used for.
John Crim was found guilty in 2008 for conspiracy to defraud the US, and for interfering with the IRS. Crim was the co-founder of a Texas group that encouraged investors to place their assets offshore to evade taxes, according to a statement by the Department of Justice. Crim claims that out of his 14,000 clients, only 23 were abusing the system. He was ordered to pay $17.2 million in restitution and serve eight years in prison. He was released to a halfway house in 2014. In an interview with Fusion, he maintained his innocence and denied responsibility for any of his clients’ wrongdoing: “I didn’t want to spend all my time investigating what they’re doing.” He shows up in the Panama Papers as an intermediary who registered one company with Mossack Fonseca, through their office in Malta.
Andrew Mogilyansky incorporated a company with Mossack Fonseca in 1995. He later was convicted by a federal court in 2009 for traveling with intent to engage in illicit sexual conduct, and for engaging in illicit sexual conduct in foreign places, after traveling to Russia and hiring underaged prostitutes. He was sentenced to eight years in prison and ordered to pay $15,000 in restitution to the victims. It was additionally alleged that Mogilyansky had close ties to a sex-trafficking ring in Russia, and a civil complaint implicated one of his U.S.-based businesses in laundering the profits. It was never proven, and Mogilyansky denied the claims in an interview with Fusion.
Authorities in the British Virgin Islands approached Mossack Fonseca in 2014 looking for background information on Mogilyansky, the Panama Papers show; Mossack scrambled to pull something together and came across his conviction. “Yes, he was convicted for being a pedophile,” one Mossack employee wrote in an email. Another employee responded: “I don’t see how this company could have made money from the client’s pedophilia.” Fusion reached out to Mossack Fonseca requesting comment and received no response. The firm continued working with him.
JEAN ‘RICHARD’ CHARBIT
Jean “Richard” Charbit, a Frenchman living in Miami, was charged with securities fraud, pleading guilty in 2010. The scheme also intended to “defraud the investing public” by manipulating stock prices. Charbit was released from prison in 2012. Documents reveal that Mossack Fonseca continued to work with Charbit on at least 12 corporate entities, despite knowledge of his financial crimes. In response to concerns over Charbit’s arrest and conviction record, one Mossack employee wrote: “The customer has generated significant revenue for the firm.”
MAURICIO COHEN ASSOR & LEON COHEN LEVY
Mauricio Cohen Assor & Leon Cohen Levy were found guilty of “conspiracy to defraud the United States and filing false tax returns.” A criminal trial revealed that the father-and-son developers were hiding more than $150 million in assets in shell companies — from cars and Miami Beach mansions to yachts, luxury cars, and bank accounts. The Panama Papers reveal that Assor and Levy are indeed the true owners of these shells. The pair maintained at least 13 offshore accounts through Mossack Fonseca, many of which were named in the case against them. Both remain in prison today. Neither man had responded to Fusion’s request for comment by publication time.
Igor Olenicoff is listed among Forbes’ 10 most infamous tax cheats. He pled guilty to lying on his tax returns in 2007 after claiming he held no foreign companies or accounts. In reality, he was stashing $200 million in offshore accounts. After settling with the IRS for $52 million and managing to avoid jail time (only serving two years probation), he sued the bank UBS in 2008, claiming that he had been duped into these schemes without any prior knowledge. He appears in the data as a shareholder in the company Olen Oil Management Limited.
MUKHTAR SYED KECHIK & ROBERT MIRACLE
Robert Miracle and Mukhtar Kechik were involved in a $65 million ponzi scheme out of Seattle. Both maintained offshore accounts through Mossack Fonseca, and the Panama Papers reveal Miracle even opened one in the name of his daughter as he awaited trial. Miracle was eventually caught and sentenced to 13 years in prison in 2011. Kechik remains a fugitive.
Martin Frankel was convicted of looting $200 million of insurance companies’ assets, diverting them into private offshore accounts to fund his own lavish lifestyle. The scam was finally exposed when insurance regulators in Mississippi placed three Frankel-connected insurers under supervision. In 2004, he was sentenced to 17 years in prison. The criminal complaint against him cited one of his Mossack Fonseca-organized companies; a separate fraud suit against him by insurance commissioners from five states listed two more companies that Frankel had incorporated through Mossack.