Police raided the Lima office of Mossack Fonseca on Monday in it tax-evasion investigations into Peruvian citizens and companies named in the Panama Papers.
Police armed in riot gear accompanied a team of 20 prosecutors and officials from Peru’s tax authority, SUNAT, to seize hundreds of documents from a two-story home on a quiet street in Lima’s upscale district of San Isidro on Monday.
The home of Monica de Ycaza has served since 2001 as the Peru office of Mossack Fonseca, the Panamanian law firm behind the scandal known as “Panama Papers.” An anonymous source leaked 11 million internal documents showing how the firm helped some of the world’s wealthiest people create offshore entities to evade taxes in their home countries.
Independent journalism website Ojo Publico, a partner of the International Consortium of Investigative Journalists (ICIJ) network which helped break the Panama Papers story, has led the coverage of how the company operated within Peru. Ojo Publico has identified which of Peru’s leading companies, businessmen and politicians had links to the controversial firm.
Ojo Publico reports that Monssack Fonseca creates a maze of holding companies which transverse different tax havens for its clients. Entities in Panama, the British Virgin Islands and dozens of other tax havens help conceal the location of money.
“The UIF cannot even look into these legal black holes,” Financial Intelligence Unit (UIF) director Sergio Espinoza told Ojo Publico. “It is difficult to track somebody operating in these jurisdictions because they do not use their real names. [They create] legal entities to avoid being identified as the true owner.”
SUNAT director Martin Ramos told Ojo Publico that his office was currently investigating 2,000 citizens who receive undeclared income abroad.
“We Peruvians are subject to taxes on all [income] that we generate inside and outside of Peru,” reads an email from Mossack Fonseca’s Lima office to the Panama headquarters. “For foreign income we pay 30%. Many people leave their money abroad and don’t declare it. That money is in foreign banks (Citibank, Inteligo, UBS, Credit Suisse, Andorra, Morgan Stanley, JP Morgan, HSBC). [The banks] have officials in Peru without permission, behind closed doors.”
“[The banks] do not have a license to operate, yet they here they are getting funds,” reads the email. “The issue is complicated because [SUNAT] just implemented new rules. Somebody who collaborates with a Peruvian in not declaring everything they have and not paying taxes is subject to eight years in prison. Those who form [offshore] companies do so for confidentiality, and then don’t declare them.”
Ojo Publico identified a former Cabinet minister, a congressman, a former SUNAT official and various businessmen and celebrity chefs who were clients of the Panamanian firm. Alleged mafia boss Rodolfo Orellana and drug trafficker Fernando Zevallos were two of Mossack Fonseca’s first Peruvian customers.
Lambayeque congressman Virgilio Acuña, brother of disgraced presidential candidate Cesar Acuña, created a Panamanian firm to conceal his ownership of two construction firms as he launched his bid for Congress. Acuña’s various companies won $83 million in government contracts, the largest of which came from La Libertad during Cesar Acuña’s 10-month stint as governor. Other contracts came from Ancash under former governor Cesar Alvarez, who is currently jailed for corruption.
Two Popular Strength donors gave over $100,000 to the 2011 and 2016 campaigns of presidential candidate Keiko Fujimori. As Cabinet chief under Alejandro Toledo, Pedro Pablo Kuczynski signed a letter of recommendation which former banker Francisco Pardo used to incorporate a company in Panama. However neither of those cases seem to amount to a crime for either candidate.
Ojo Publico identified offshore legal entities which are subsidiaries of Peru’s largest banks and holding companies including Credicorp, Ferreycorp, Grupo Breca, Grupo Gloria, Hochschild Mining and Intercorp.
High-profile personalities who created offshore companies with Mossack Fonseca include investigative journalist Nicolas Lucar, former housing minister Hernan Garrido, Nobel laureate Mario Vargas Llosa and celebrity chef Gaston Acurio. Ojo Publico also identified figures believed to be connected to illegal mining and logging in Peru.
Acurio published his tax returns on Facebook in light of the revelations to prove he had not hidden money abroad. He told El Comercio that his business managers did not set up offshore entities to evade taxes, but to make it easier to comply with the regulations of all the countries where he operates restaurants.
“In Peru there are many institutions and companies that use [offshore companies] legally, but some do not,” Oscar Rivera, president of Peru’s banking association, Asbank, told El Peruano. “What should be clear is that this is a normal practice in the business world, which can be used for good or bad.”
“They are investigating some companies and economic groups which I do not really believe have committed the crime of tax evasion or used offshore companies to do it,” Rivera added.
Peru’s SUNAT investigators and prosecutors must return the documents seized from Monica de Ycaza’s home within 60 days. Tax evasion can be punished by two to eight years in prison. According to Colombia Reports, offshore tax havens cost the Pacific Alliance member country billions of dollars in annual tax revenue.
Peru’s raid of the firm’s Lima office came one day before Panamanian authorities raided the Mossack Fonseca headquarters in Panama City.
The Panama Papers from law firm Mossack Fonseca are the largest document leak since Wikileaks’ 2011 disclosure of U.S. State Department communications, which became known as Cablegate. The documents revealed the offshore links of several of the world’s heads of state and celebrities and prompted the resignation of Iceland Prime Minister Sigmundur Gunnlaugsson.
LOS MILLONARIOS NEGOCIOS DE MOSSACK FONSECA EN LIMA (Ojo Publico)
LA SOCIEDAD OFFSHORE DE VARGAS LLOSA (Ojo Publico)
El poder económico en el Perú (Ojo Publico)
Sunat descubre presunto desbalance patrimonial en representante de Mossack Fonseca en Lima (Ojo Publico)
Asbanc: no todas las empresas “offshore” realizan prácticas ilegales (Andina)
¿CUÁNDO SE CONFIGURA EL DELITO DE DEFRAUDACIÓN TRIBUTARIA? (PUCP)
Gastón Acurio: Entraremos a formatos de ‘fast casual’ (El Comercio)
Panama Papers: incautan documentos contables de oficina en Lima (El Comercio)
Panama Papers: Sunat allana sede de Mossack Fonseca en Lima con apoyo de Fiscalía y Policía (Gestion)
Panamá Papers: Sunat y Fiscalía intervinieron oficina en Lima de Mossack Fonseca [Fotos y video] (Peru 21)