Tuesday, April 5, 2016


The partners, and the public relations people working for Mossack Fonseca, have gone to great lengths to claim that the law firm merely formed corporations and foundations for valued clients, and was not involved in their financial matters. In truth and in fact, MF was engaged in money laundering, as well as wealth management for their clientele, on a massive basis.

Forget about the whistleblower for a minute; let me introduce you to a Panamanian couple; We shall call them Sr. y Sra. S_____z. He is a wealth manager for MF, and his wife works as a compliance officer there, and they are Confidential Informants. This duo, who had a large amount of incriminating information from MF files, sought repeatedly to sell it to the highest bidder in Panama. Whether they found ready, will and able buyers is anyone's guess.

They also disclosed a some sordid details about MF, all of which the company is attempting to deny ever happened. Here's a sample:

(1) Mossack Fonseca employed over 120 sales staff, worldwide in its wealth management branch, whose sole goal was to sign up clients. Their illicit funds would first be laundered, through bearer share Panamanian companies, and then invested, so that the client would realize a regular return on his or her illegally-acquired assets. There was a division of labor; money laundering was handled by one division, and wealth management by another. Some these "investments" were arms trafficking into African countries caught up in civil wars;  many of the others were for illegal or immoral purposes as well.

(2) Compliance officers at MF were replaced and rotated every two months, which meant that nobody in compliance had the big picture about the clients who were engaged in criminal activities, or who were PEPs banking bribe & kickback money. This short-term replacement also meant that MF would not have to pay the ones who were let go severance, which is otherwise required under Panamanian employment law.

When the compliance officer ascertained that a new client was either a criminal, or subject to international or OFAC sanctions, or a corrupt PEP, management would tell her to disregard her information, because the Panamanian authorities would never discover that fact. Panama does have an abysmal record, regarding arrests for money laundering. Simply put, there are none. Remember also, that Ramon Fonseca himself, while trying to defend his law firm, admitted that it does not always know the identity of the beneficial owner of a corporation that it forms for "valued clients." We call that Willful Blindness, in the Money Laundering Control Act of 1986.

Therefore, when you hear from the spin doctors at Mossack Fonseca, remember that it does indeed engage in money laundering for dodgy clients, as well as investing their criminal proceeds. 

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