Pandora Papers : Kenya President And Relatives Amassed More Than $30m of Offshore Wealth
Kenya’s president, Uhuru Kenyatta, will come under pressure to explain why he and his close relatives amassed more than $30m of offshore wealth. This follows the release of secret deals and hidden assets of some of the world’s richest and most powerful people in the biggest trove of leaked offshore data in history.
Branded the Pandora papers, the cache includes 11.9m files from companies hired by wealthy clients to create offshore structures and trusts in tax havens such as Panama, Dubai, Monaco, Switzerland and the Cayman Islands.
They expose the secret offshore affairs of 35 world leaders, including current and former presidents, prime ministers and heads of state. They also shine a light on the secret finances of more than 300 other public officials such as government ministers, judges, mayors and military generals in more than 90 countries.
The files include disclosures about major donors to the Conservative party, raising difficult questions for Boris Johnson as his party meets for its annual conference.
More than 100 billionaires feature in the leaked data, as well as celebrities, rock stars and business leaders. Many use shell companies to hold luxury items such as property and yachts, as well as incognito bank accounts. There is even art ranging from looted Cambodian antiquities to paintings by Picasso and murals by Banksy.
The Pandora papers reveal the inner workings of what is a shadow financial world, providing a rare window into the hidden operations of a global offshore economy that enables some of the world’s richest people to hide their wealth and in some cases pay little or no tax
There are emails, memos, incorporation records, share certificates, compliance reports and complex diagrams showing labyrinthine corporate structures. Often, they allow the true owners of opaque shell companies to be identified for the first time.
The files were leaked to the International Consortium of Investigative Journalists (ICIJ) in Washington. It shared access to the leaked data with select media partners including the Guardian, BBC Panorama, Le Monde and the Washington Post. More than 600 journalists have sifted through the files as part of a massive global investigation.
The offshore trail also stretches from Africa to Latin America to Asia, and is likely to pose difficult questions for politicians across the world. In Pakistan, Moonis Elahi, a prominent minister in prime minister Imran Khan’s government, contacted an offshore provider in Singapore about investing $33.7m.
In Kenya, the president, Uhuru Kenyatta, has portrayed himself as an enemy of corruption. In 2018, Kenyatta, he told the BBC: “Every public servant’s assets must be declared publicly so that people can question and ask: what is legitimate?”
He will come under pressure to explain why he and his close relatives amassed more than $30m of offshore wealth, including property in London. Kenyatta did not respond to enquiries about whether his family wealth was declared to relevant authorities in Kenya.
The Pandora papers also reveal some of the unseen repercussions of previous offshore leaks, which spurred modest reforms in some parts of the world, such as the BVI, which now keeps a record of the real owners of companies registered there. However, the newly leaked data shows money shifting around offshore destinations, as wealthy clients and their advisers adjust to new realities.
Some clients of Mossack Fonseca, the now-defunct law firm at the heart of the 2016 Panama papers disclosures, simply transferred their companies to rival providers such as another global trust and corporate administrator with a major office in London, whose data is in the new trove of leaked files.
Asked why he was migrating the new company, one customer wrote bluntly: “Business decision to exit following the Panama papers.” Another agent said the industry had always “adapted” to external pressure.
Some leaked files appear to show some in the industry seeking to circumvent new privacy regulations. One Swiss lawyer refused to email the names of his high-value customers to a service provider in the BVI, following new legislation. Instead, he sent them by airmail, with strict instructions they should not be processed in any “electronic way”. The identity of another beneficial owner was shared via WhatsApp.
“The purpose of this way to proceed is to enable you to comply with BVI rules,” the lawyer wrote. Referring to Mossack Fonseca, the lawyer added: “You are obliged to keep secrecy for our clients and to not make feasible at all a second ‘Panama papers’ story that happened to one of your competitors.”
Gerard Ryle, the director of the ICIJ, said leading politicians who organised their finances in tax havens had a stake in the status quo, and were likely to be an obstacle to reform of the offshore economy. “When you have world leaders, when you have politicians, when you have public officials, all using the secrecy and all using this world, then I don’t think we’re going to see an end to it.”
He expected the Pandora papers to have a greater impact than previous leaks, not least because they were arriving in the middle of a pandemic that had exacerbated inequalities and forced governments to borrow unprecedented amounts to be shouldered by ordinary taxpayers. “This is the Panama papers on steroids,” Ryle said. “It’s broader, richer and has more detail.”
At least $11.3tn in wealth is held offshore, according to a 2020 study by the Paris-based Organisation for Economic Co-operation and Development (OECD). “This is money that is being lost to treasuries around the world and money that could be used to recover from Covid,” Ryle said. “We’re losing out because some people are gaining. It’s as simple as that. It’s a very simple transaction that’s going on here.”
CREDIT: THE GUARDIAN