If This Mossack Fonseca Investigation Is Real, I Wonder What Will Turn Up in Russia

Photo credit: FABRICE COFFRINI - Getty Images
Photo credit: FABRICE COFFRINI - Getty Images

From Esquire

Before we dive into the algae-coated chaos that is Camp Runamuck, we should pay some attention to a couple of other interesting developments. Right now, Netflix is running a film called The Laundromat, a Steven Soderburgh work that traces the massive—and allegedly criminal—operations of an offshore law firm called Mossack Fonseca, whose extraordinarily vast alleged money-laundering and asset-hiding empire was revealed through a huge leak of the firm's documents in 2016 that came to be known as The Panama Papers.

The movie was released despite a Hail Mary defamation suit filed by the two men who ran Mossack Fonseca, played in the film by Gary Oldman and Antonio Banderas, respectively. The suit sought to prevent Netflix from releasing the film. (It clearly failed since I watched it last night.) But, in the court filings in support of the suit, Mossack Fonseca's lawyers maintained that the firm is currently being investigated by the FBI. From the International Consortium of Investigative Journalists.

The pair, partners in the offshore law firm whose confidential files were exposed in the Panama Papers, are suing Netflix for defamation over the film, in which they are played respectively by Antonio Banderas and Gary Oldman. Private investigator Arthur Ventura Jr states in an affidavit to the Connecticut District Court that “in his opinion” Mossack and Fonseca “are not only targets of a federal investigation” but are also subject to U.S. prosecutors’ positions “that both men serve a sentence of incarceration.”

In case you've forgotten...

The 2016 Panama Papers investigation centered on 11.5 million records leaked from Mossack Fonseca that revealed how politicians, business leaders, celebrities and criminals operated through hard-to-trace shell companies in tax havens. The investigation, a collaboration of almost 400 journalists from 80 countries, led to the resignation of prime ministers, criminal charges in Latin America and Europe and to governments from Australia to Iceland recovering more than $1.2 billion in unpaid taxes and penalties.

If the FBI really is pursuing Messrs. Mossack and Fonseca, it will be interesting to see what happens when and if the investigators run up against some of the Trump Organization's pals in Russia. According to the original Panama Papers leak, the law firm's business was lousy with money from Russian oligarchs with ties to Vladimir Putin, and with money from Putin himself. From the Guardian:

These assets are only part of a series of linked financial schemes revealed in the documents that revolve round Bank Rossiya. The bank is headed by Yuri Kovalchuk. The US alleges he is the “personal banker” for many senior Russian government officials including Putin. The Panama Papers disclose that Kovalchuk and Bank Rossiya achieved the transfer of at least $1bn to a specially created offshore entity called Sandalwood Continental. These funds came from a series of enormous unsecured loans from the state-controlled Russian Commercial Bank (RCB) located in Cyprus and other state banks. There is no explanation in the files of why the banks agreed to extend such unorthodox credit lines.

Some of the cash obtained from RCB was also lent back onshore in Russia at extremely high interest rates, with the resulting profits siphoned off to secret Swiss accounts. A $6m yacht was purchased by Sandalwood and shipped to a port near St Petersburg. Cash was also handed over directly to the Putin circle, this time in the form of very cheap loans, made with no security and with interest rates as low as 1%. It is not clear whether any loans have been repaid.

(Not for nothing, but are there any Russian oligarchs any more who don't "have ties" to Vladimir Putin? Living ones, I mean.)

Photo credit: VIEW press - Getty Images
Photo credit: VIEW press - Getty Images

Also on this episode of Crimestyles Of The Rich and Famous, in New York, the first civil trial in connection with how the energy companies have lied about the climate crisis gets underway this week. The defendant is Exxon. From Inside Climate News:

Exxon is accused of disclosing one set of these projected carbon costs to investors while planners used an entirely different set internally for evaluating investments. The public set was more conservative and projected that climate policies would be more stringent, while the internal one assumed more modest attempts to limit emissions. The effect of using these dueling estimates, the attorney general says, was that Exxon hid tens of billions of dollars in potential costs, downplaying the risk to investors and inflating the company's value.

Applying a lower estimate for carbon costs made high-polluting projects look more financially attractive, and it undermined the investment case for any project that would reduce emissions. Nowhere is this clearer than in Exxon's tremendous investments in Canada's oil sands, a vast expanse of low-grade hydrocarbons that now make up about 30 percent of the company's oil reserves. "The oil sands crystallizes, at least from my perspective, everything about this issue that is concerning with Exxon," said Andrew Logan, who runs the oil and gas program at Ceres, a nonprofit that works with investors to push for more sustainable business practices. "Oil sands tick all the boxes when it comes to a carbon-risky asset."

Laundered money and dirty energy. Modern capitalism summed up in two commodities.

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