In 2016, an unnamed whistleblower provided Munich daily newspaper Süddeutsche Zeitung with encrypted internal documents from Mossack Fonseca, a Panamanian law firm that sold anonymous offshore companies. These entities enabled owners to hide wealth, engage in illegal financial transactions and evade income taxes.

Known as the Panama Papers, the millions of documents leaked gave evidence that shamed wealthy individuals, corporations, and public officials.

The data provides rare insights into a world that can only exist in the shadows. It proves how a global industry led by major banks, legal firms, and asset management companies secretly manages the estates of the world’s rich and famous: from politicians, FIFA officials, fraudsters and drug smugglers, to celebrities and professional athletes.

The Süddeutsche Zeitung decided to analyze the data in cooperation with the International Consortium of Investigative Journalists. ICIJ had already coordinated the research for past projects that SZ was also involved in, among them Offshore Leaks, Lux Leaks, and Swiss Leaks. 

Panama Papers – The Secrets of Dirty Money

The leaked records come from a little-known but powerful law firm based in Panama, Mossack Fonseca, that has branches in Hong Kong, Miami, Zurich and more than 35 other places around the globe.

Mossack Fonseca’s fingers are in Africa’s diamond trade, the international art market and other businesses that thrive on secrecy…

The cache of 11.5 million records shows how a global industry of law firms and big banks sells financial secrecy to politicians, fraudsters and drug traffickers as well as billionaires, celebrities and sports stars.

The leaked data covers nearly 40 years, from 1977 through the end of 2015. It allows a never-before-seen view inside the offshore world — providing a day-to-day, decade-by-decade look at how dark money flows through the global financial system, breeding crime and stripping national treasuries of tax revenues.

The documents make it clear that major banks are big drivers behind the creation of hard-to-trace companies in the British Virgin Islands, Panama and other offshore havens. The files list nearly 15,600 paper companies that banks set up for clients who want keep their finances under wraps, including thousands created by international giants UBS and HSBC.

Giant Leak of Offshore Financial Records Exposes Global Array of Crime and Corruption

In April 2021, ICIJ reported:

Five years after the Panama Papers were first published, authorities are still clawing back lost tax dollars and prosecuting wrongdoers exposed by the global investigation.

Governments around the world have now recouped more than $1.36 billion (about C$1.75 billion) in back taxes and penalties as a direct result of the Panama Papers, including $185 million in newly-reported recoveries over the past two years...

Canada’s tax agency has assessed over $16 million in taxes and fines, but did not provide a figure for money that has been recouped by the government…

Canada did not make the ICJI list of 24 countries that had publicly confirmed recovery of taxes, penalties and interest following release of the Panama Papers.

In 2021, CRA told the CBC that it had identified almost 1,000 Canadians involved in Panama Papers documents. It appears that halfway through 2022, CRA has laid zero charges have against those identified. Toby Sanger, economist and executive director of the advocacy group Canadians for Tax Fairness said:

I was feeling patient — it does take time to investigate and prosecute — but now it’s been five years. We’ve just seen too little compared to what’s happened in other countries.

Despite saying the right things in public, Canada’s NDP confidence and supply agreement with Trudeau Liberals imposed no requirement to strengthen tax laws affecting overseas tax shelters or alter the CRA’s preference for low-hanging fruit when enforcing tax laws.