Law firm at center of Panama Papers leak was implicated in Brazil corruption scandal in January

Keren Blankfeld – Forbes, 04/06/2016

Two months before one of the world’s largest data leaks, dubbed the Panama Papers, was made public on Sunday, Brazilian prosecutors accused the Panama law firm Mossack Fonseca at the center of the leak, of corruption. (The firm, whose leaked records span 40 years and make up the Panama Papers, according to the International Consortium of Investigative Journalists (ICIJ), issued a statement to the ICIJ denying any unlawful activities. In addition, it stated that ties to offshore companies is not an implication of wrongdoing.)

On January 27 Brazil’s Federal Police, as part of Brazil’s far-reaching corruption probe known as Operation Car Wash (“Operação Lava Jato”), accused the firm of helping clients create offshore entities to hide corrupt money. Prosecutors alleged that the firm was using real estate company OAS Empreendimentos Imobiliários S/A to help cover up money made in the criminal scheme involving state-owned oil giant Petrobras . Six temporary arrests were made and 16 search warrants were issued. Lawyers representing those arrested denied any wrongdoing or irregularities. FORBES has been unable to reach the firm for comment. Aside from its office in Brazil, the firm also has branches in 40 other cities.

According to the ICIJ, which on Sunday began sharing information on the Panama Papers, Mossack Fonseca’s cofounder Ramón Fonseca, an adviser to Panama’s president, “took a leave of absence as presidential adviser in March after his firm was implicated in the Brazil scandal and ICIJ and its partners began to ask questions about the law firm’s practices.”

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