Panama papers – Brazilian politician

RNZ has more on Panama papers revelations.

Brazilian politician used NZ company to hide wealth (audio)

Disgraced Brazilian politician Eduardo Cunha has used a New Zealand company to hide his wealth in secret bank accounts, in the latest from the Panama Papers investigation.

Disgraced Brazilian politician hid money through NZ firm

A controversial and disgraced prominent Brazilian politician accused of taking millions of dollars in bribes used a New Zealand company as part of a complex arrangement to hide his wealth in secret bank accounts.

Eduardo Cunha, the suspended speaker of Brazil’s lower house of Congress, used a New Zealand trust company run by people featuring prominently in the Panama Papers and tax haven organiser Mossack Fonseca, to hide millions of dollars in bribes involving the state-run oil company Petrobras.

Mr Cunha was suspended for obstructing the official inquiry into the corruption scandal and his notoriety in Brazil is such that he’s been likened to the fictional corrupt US politician Frank Underwood, featured in the television series House of Cards.

The New Zealand link is PVCI New Zealand Trust, set up in July 2008 by a Panamanian company of the same name.

Law firm Cone Marshall linked to disgraced Brazilian politician (audio)

The New Zealand law firm Cone Marshall has been involved with yet another case that’s been revealed by the Panama Papers – this time its a disgraced prominent Brazilian politician.

Panama Papers NZClick here for full coverage

Facts arising out of the Panama Papers

Christ Trotter summarised the Panama Papers:

  • New Zealand is not a tax haven in the generally accepted definition of that term.
  • Changes to New Zealand legislation have put this country at risk of being perceived as a tax haven.
  • The Panamanian law firm, Mossack Fonseca, took advantage of our legislative laxity to promote New Zealand as a politically stable and corruption-free hiding place for their clients’ assets.
  • The National-led Government’s responses to IRD warnings that New Zealand was at risk of losing its corruption-free reputation were wholly inadequate.
  • The entire problem can be solved easily: simply by toughening-up the disclosure provisions of the relevant legislation.

Trotter also summarised Labour’s handling of the issue:

If Labour had been willing to assess these facts dispassionately, and with an eye to presenting itself as a credible alternative government, its handling of the Panama Papers would have been very different.

From the outset, it would have made it very clear that its number one priority was to protect New Zealand’s international reputation. That being the case, it would have been very careful to avoid calling their country a tax haven.

Their treatment of the Prime Minister would also have been different. Rather than attempting to associate him with the dubious behaviour of Mossack Fonseca, they would have acknowledged that the offending legislation had evolved gradually, under both Labour and National, and offered to make its remediation a bi-partisan effort.

Having sought out and obtained the best advice available from tax lawyers and accountants about how the legislation might best be rewritten to eliminate its usefulness to entities like Mossack Fonseca, Labour would then have approached the Government with an offer to rush through the necessary changes under urgency.

It’s hard to argue with this.

From Labour fails to make gains from Panama Papers

The concept of left wing balance

Early last week Radio New Zealand teamed up with Nicky Hager to reveal not very much about New Zealand’s involvement in the Panama papers.

The Standard had a number of posts as a result, including:

Sprung! New Panama Papers dump confirm NZ is a tax haven

A new release of Panama papers absolutely confirms New Zealand is a tax haven says Nicky Hager. And ironically, it is because of New Zealand’s squeaky clean reputation that tens of thousands of foreigners have come flooding here.
Rather than actually dealing with the issue, John Key is using his old classics “nothing to see here” coupled with “Labour did it too”, “nicky hager is a conspiracy nut”, and “wait for the (Shewan) whitewash enquiry” defenses.

John Key chickens out of #panamapapers interview

The Radio New Zealand TV One Nicky Hager release of analysis of the Panama Papers is underway and the media response is fascinating.

First up John Key pulled out of his regular Radio New Zealand interview after learning what he was to be questioned about. He attended all other media invitations. One wonders why. Perhaps National needs the PR advice to try and work out how to respond.

Radio NZ working with Nicky Hager on a major story (ok, on a minor story in a major way) seems to be fine.

The second of those was by MickySavage. Yesterday he posted:

Matthew Hooton and the Radio New Zealand post

Radio New Zealand recently published a piece penned by well known supporter of the right Matthew Hooton.  What has happened to the concept of balance?

This tweet caused me some surprise when I first saw it.  I respect the quality of Radio New Zealand’s reporters and its commitment to the concept of quality journalism.  But I scratched my head when I saw this tweet because the conclusion seemed completely overblown and so un Radio New Zealand like.

What was really weird was that the post was written not by a staff member but by that well known commentator for the right Matthew Hooton.

I was astounded by this.  Isn’t Radio New Zealand meant to provide “innovative, comprehensive, and independent broadcasting services of a high standard”?  How could Hooton’s views be considered to be independent?

Hager is not an RNZ staff member. He is well known as a left leaning political activist.

Why are his views accepted as independent and balanced while it is ‘astounding’ that Hooton’s opinion is allowed on public radio airwaves?

Hooton’s article was ideologically driven and contained clear bias.  And it was completely lacking in detail or analysis.

Many people saw the RNZ/Hager coverage of the Panama papers in a similar light.

But getting back to Hooton’s column why did Radio New Zealand agree to it being published?  Did the arrangement to report on the issue with Nicky Hager upset the right that much that they demanded a patsy piece in the interests of “balance”?

So including a different opinion from Hooton is somehow a right wing conspiracy of public radio coercion, but collaborating with Hager is beyond reproach?

A rule from Presland farm:

Media balance is essential but some balance is more essential than those bloody righties being allowed to say something too.

It’s worth noting that Hooton was given a permanent ban from The Standard last week. Their sort of balance?

Who cares about papers from Panama?

The big Panama Papers revelations promised for this week seem to have fizzled out quickly.

Does anyone part from a few journalists and opposition MPs and a political activist care much about them?

Jane Paterson asks at RNZ: Panamania – do Kiwis care about the Papers?

The Panama Papers story is a hard one to tell, but underneath the tales of Brazilian online gambling tycoons, world leaders and Venezuelan bankers are important issues that need to be addressed.

But are they being addressed adequately? Sensible? Non-sensationally?

One problem now is that if something genuinely damning emerges all the wolf wailing may dampen the public response.

One of the questions repeatedly asked is why should New Zealanders care about this story, prompted by a massive leak of documents from the Panamanian law firm Mossack Fonseca.

That largely remains unanswered.

New Zealand warranted some mention, but the real focus on this country has only been since a team of journalists from RNZ and TVNZ, and the investigative journalist Nicky Hager, was given access to the Papers about a fortnight ago.

No, RNZ and TVNZ tried to give it real focus and most people’s vision went fuzzier.

If you can be bothered read through Paterson’s insistence there are important and worrying aspects in there somewhere.

I skimmed to the bottom.

The government has ended the week relatively unscathed as a result of the Panama Papers but the story was never intended to target the government and specific ministers, but rather to highlight how the system operates and the effect that potentially has on New Zealand’s reputation.

Perhaps it wasn’t the intention of RNZ or Paterson, but Hager and Labour and the Greens were hard out targeting the government, with the assistance of RNZ and TVNZ.

In the end it is up to New Zealanders to decide how much they care, and whether they want to see this kind of activity continue in their country.

It’s also up to New Zealanders to decide how much they care about objective and unbiased investigation and reporting.

Using Nicky Hager as the main messenger is not a great way to make the country care about an issue.

In answer to the headline question, here are the current most read articles at NZ Herald:

  1.  The 14-year-old boy who turned down $44 million
  2.  Bachelor break-up: Jordan’s friends come to his defence
  3.  Duncan Greive: The hot mess that is The Bachelor NZ
  4.  Shane Watson: Kate Middleton needs a style update
  5.  Interactive: What CEOs of top NZ companies earn

And if I look right now on the One News main page I have scrolled down to see about a hundred stories and can’t see a single one on the Panama papers.

If you look hard you might see a link in the top right to THE PANAMA PAPERS. But not even One News seems to care about the big stories they were pushing earlier this week.

Maybe if the Batchelor had a trust it might make the headlines over and over and over.

New Zealand’s reputation at stake

Today’s ODT editorial says that “New Zealand is not a tax haven in the way many countries in the world operate” but the country’s reputation is at stake over the Panama papers revelations.

NZ’s reputation at stake

Prime Minister John Key is moving to protect the international reputation of New Zealand as a place to do business, with the release of the Panama Papers forcing his hand.

The Panama Papers have proved to Kiwis that this country is being used by foreign business people and global leaders as a way to pervert the tax laws of their home countries.

Let’s be clear, however. New Zealand is not a tax haven in the way many countries in the world operate. Our foreign tax laws may be used by overseas people to defraud their own countries of tax, but our tax base is not being exploited. Nothing about those trusts is illegal in this country with most apparently meeting our tax laws.

Nothing relating to new Zealand has been found to be illegal – yet – but if overseas people can use New Zealand’s trust laws to hide illegal activity or avoid tax illegally then it looks bad for New Zealand.

However it should be noted that if New Zealand wasn’t being used for questionable trusts other countries would be used – as they are, far more than New Zealand is.

What is at stake is New Zealand’s reputation which is seen around the world transparent and stable. We are consistently at the top of tables about the ease of doing business, the least corrupt country and one of the most transparent.

Mr Key is indicating a second phase of anti-money laundering measures may be brought forward in the wake of the Panama Papers. He denies the papers are evidence New Zealand is a tax haven, in line with tax experts. Here the foreign trusts need to provide information to Inland Revenue and the trustee fills out an annual return. In tax havens, little or no information is supplied to authorities.

If there is potential reputational damage then something needs to be seen to being done about it.

There has been no indication any of the people named were acting illegally, just that they were involved in some way or another. The tall-poppy syndrome is never far from sight in this country. The latest name dump is guilt by association, without context.

That is also a major issue that could affect reputations of those implicating named people in shady dealings.

Labour leader Andrew Little is saying Mr Key has damaged New Zealand’s reputation by siding with those people keen to limit their tax obligations. Labour will abolish foreign trusts but it needs to be said the current regime was put in place by former Labour finance minister Sir Michael Cullen in 2005.

Sir Michael required foreign trusts with New Zealand resident trustees to provide some tax information to Inland Revenue – exactly what is currently happening.

Thanks to the past Labour led government and the current National led government New Zealand’s tax and trust laws are (or have been) highly regarded. That is apparently a part of the problem, our reputation is being exploited by some people who want to use trusts.

The Government has appointed well-regarded accountant John Shewan to undertake an independent review of disclosure rules covering the foreign trusts in New Zealand. Mr Key indicated the Government is open to any changes Mr Shewan may suggest.

So far, New Zealand has complied with every information request from its treaty partners to the standard set by the OECD and $205 million has been invested since Budget 2012 to strengthen compliance work by Inland Revenue.

Reputational damage is hard to repair and Mr Key will be wise to act quickly on recommendations coming from both Mr Shewan and Inland Revenue.

The spotlight will be on Shewan’s report in particular. Somethig needs to be seen to being done.

For the good of New Zealand’s reputation Labour need to work positively with this with the Government to ensure our good tax and trust laws are improved.

Panama papers continued

I’m too busy to wade through all the Panama papers stuff and am already getting jaded by what seems to be overkill, where genuine issues of concern will be swamped by the volume.

So feel free to post related links and information here and discuss it.

I expect that by the end of the day you will have jointly summaries it all succinctly for me so I can update myself on what is going on.

From a comment by Gezza:

Dom Post editorial today:

Search here if you have a few years to spare:

Offshore Leaks Database

Find out who’s behind almost 320,000 offshore companies and trusts from the Panama Papers and the Offshore Leaks investigations

Panama papers investigation – “NZ a tax haven”

Nicky Hager says “What the Panama Papers show without any doubt at all, absolutely conclusively, is that New Zealand is functioning as a tax haven.”

That in itself may or may not be a serious issue for New Zealand. Any country can potentially be used in some way by someone as a tax haven.

It could be argued that Inland Revenue enables tax evasion because some people in New Zealand evade tax. Should we clamp down on the grey economy?

The key issue is whether New Zealand allows trusts that are out of the ordinary and what trusts are used for here can’t be used elsewhere.

Does New Zealand need to clamp down on trusts? Or are we just one option for rich people wanting to hide income and if we weren’t available they would simply do it somewhere else?

If the latter then it is an international issue and the motives for singling out New Zealand should be examined.

Nicky Hager has a reputation for politically loaded revelations so this will require substantial balanced analysis.

One News: Panama Papers investigation: ‘NZ absolutely, conclusively is a tax haven’

Tens of thousands of Panama Papers documents reveal how New Zealand, Niue, The Cook Islands and Samoa have become prime destinations for the rich to hide their financial secrets.

 The documents have been subject of an investigation by ONE News, in partnership with RNZ News and investigative journalist Nicky Hager.

Hager says: “What the Panama Papers show without any doubt at all, absolutely conclusively, is that New Zealand is functioning as a tax haven.”

It can be revealed that at the centre of the New Zealand operation is Roger Thompson, a former Inland Revenue worker.

His accountancy firm – Bentleys, in the heart of Auckland’s business district – is the New Zealand agent for Panama law firm Mossack Fonseca.

Mr Hager describes it as “an ordinary office in the middle of Queen Street where nobody would look and where it’s only inside the computer files and the filing cabinet that you would realise that that is the centre of all kinds of tax haven activity in our country”.

For $4000 this New Zealand agent creates trusts for wealthy foreigners who use New Zealand’s limited disclosure rules to stay anonymous, even to tax authorities.

An admin fee of almost $3000 a year will see Bentleys send a one-page form to Inland Revenue. It confirms foreign trust clients don’t need to pay any tax under New Zealand law.

Mr Hager says: “IRD never knows who the real people are who are behind these trusts. They never get to see the accounts. They never get to see what business they’re doing.”

The point has just been made on Breakfast that what is happening in New Zealand isn’t illegal.

Andrea Vance has fronted the One News investigation – working closely with Nicky Hager – and she made the point that it raised important moral questions that needed to be considered.

The investigation into the Panama Papers New Zealand is a journalistic collaboration by reporters from ONE News, RNZ News and investigative journalist Nicky Hager.

It may be difficult separating political activism from legitimate legal and financial issues.

So it needs to be properly thrashed out whether New Zealand should allow this legal activity (legal on the New Zealand trust side of things at least).


Radio NZ:

Dotcom not John Doe

I didn’t think the John Doe who claims to have hacked the Panama papers would be Kim Dotcom, but it seems that some do. It’s certainly being talked about.

Both & are speculating this morning that “John Doe” may be . Interesting theory. would know.

Theories have been circulating suggesting the mysterious figure behind the Panama Papers leaks may in fact be the NZ-based internet entrepreneur. The Spiniff begins its fearless mission to unmask John Doe by asking, is it you, Kim Dotcom?

Rare is the day when the two most voluble and entertaining thought leaders of the New Zealand blogosphere agree, but so it is on the matter of the identity of the Panama Papers’ “John Doe”, the name adopted by the person behind the massive information leak.

Both Cameron ‘Whaleoil’ Slater and Martyn ‘Daily Blog’ Bradbury – along with various other novice online sleuths – have been speculating that John Doe is Kim Dotcom, the Mega-founder being sought for extradition from New Zealand by the US Justice Department.

But Bradbury responded that “I’m not speculating it is Kim” but ” oh I certainly believe it’s political”. The last two sentences Hooton referred to :

I wonder who had the skills to hack and desire for vengeance against Key?

I’ve always believed that vengeance is a dish best served 18months into the election cycle.

That’s quite vague. Incidentally Bradbury does seem to think that this could, at last, be what what triggers the revolution (John Doe had saiD that the next revolution would be digital):

This week is looking very difficult for John Key and his right wing rich mates. Mass surveillance lies didn’t wake sleepy hobbits up. Dirty Politics didn’t wake sleepy hobbits up. Looks like Key building Tax Havens and getting caught might just wake them up.

He might be right one day, but his accuracy average won’t be flash.

Meanwhile Slater didn’t actually come out and say it was Dotcom but he did all but. He posted a ‘comment of the day’ and bolded these words.

illegally hacked


It’s a whole lot easier for the hacker, the paymaster and the intermediaries to be close so what is discovered can be discussed and assimilated.

“John Doe” appears to have a better knowledge of NZ politics than a lot of kiwis

Am I joining the dots or do I just need to loosen the tinfoil ?

Slater accusing Dotcom is nothing new. He might be right once too and might actually front up with evidence to prove it. But then he posted:

I suspect Key will have second thoughts about cutting me adrift and feeding me to the wolves at the same time as doing absolutely nothing to try and identify the criminal hackers, the complicit media working with criminals, and the people in the Labour Party that are funding, facilitating and abusing the fruits of crime.

Sorry to say, I don’t have a lot of sympathy for Key over this.  He threw me under the bus.  He threw Ede under the bus.  He’s thrown Whitney under the bus.  None of us broke the law.

Key threw Slater and Ede under a bus? Or did he just distance himself from a train wreck?

Nevertheless it sounds like Slater has more on his mind than who John Doe is. His comment is full of irony, self-sorriness, and some trepidation.

Oh, and Manhire asked Dotcom if he was the Panamanian John Doe and Dotcom denied it, saying “I’m not John Doe, Satoshi Nakamoto or Rawshark.” Of course he doesn’t have to be them.

Conclusion: I’m suspicious of Manhire trying to deflect attention onto everyone but him. I don’t think he is John Doe either but which journalist writes about Slater and Bradbury these days. And in the same post!

Russell and Hooton on trusts

An exchange on Twitter between Deborah Russell (@beefaerie)and Matthew Hooton (MatthewHootonNZ) on trusts.

Deborah Russell: I’m going to be on Breakfast on TV One tomorrow morning, shortly after the 7am news, talking about the

Matthew Hooton: Would you mind explaining that there are no such thing as ‘foreign’ or ‘family’ trusts in NZ law, but only ‘trusts’?

Deborah Russell: I’ll do my best. I have found that most people don’t quite get what’s going on. “Foreign trust” is only for tax purposes.

But the problem is “foreign trusts” and what gets shunted into them, and the lack of information about them.

Matthew Hooton: Also don’t dividends get taxed where paid? So a NZ trust owning e.g. Rio Tinto shares doesn’t get off tax on dividends?

Deborah Russell: They would get taxed in Australia, and in NZ, with our Double Tax Agreement sorting out how much tax is paid in each place.

So the NZ trust *would* pay tax on the Rio Tinto dividends. But the problem is “foreign trusts” and what gets shunted into them, and the lack of information about them.

I think it’s a moral issue, not a tax issue wrt “foreign trusts”. Happy to discuss at length sometime.

Matthew Hooton: Then should get an ethicist on not a tax expert

Deborah Russell: As my PhD is in Philosophy, and I’ve lectured in Ethics, Political Theory, AND Tax, I guess I fit the bill. And Business Ethics, Professional Ethics, Applied Ethics. And more.

Matthew Hooton: Excellent. You’ll be able to talk about the ethics of publishing 240,000 names & addresses, many who have done nothing wrong.

Deborah Russell: Many of whom *may* have done nothing immoral. People may have interesting reasons for consulting a Panamanian firm.

Matthew Hooton: The itself says being on The List does not mean the person has done anything wrong. So why issue the list if not to smear?

Deborah Russell: To crowd source knowledge.

So it could be interesting, just after 7 am on Breakfast, TV One.

The source of the Panama Papers speaks

A post by ‘John Doe’, who claims to be the source of the Panama papers, gives a mention to New Zealand and John Key but also promotes the next revolution, digitized..


Income inequality is one of the defining issues of our time. It affects all of us, the world over. The debate over its sudden acceleration has raged for years, with politicians, academics and activists alike helpless to stop its steady growth despite countless speeches, statistical analyses, a few meagre protests, and the occasional documentary.

Still, questions remain: Why? And why now?

The Panama Papers provide a compelling answer to these questions: massive, pervasive corruption. And it’s not a coincidence that the answer comes from a law firm.

That sounds quite like political activism.

Shell companies are often associated with the crime of tax evasion, but the Panama Papers show beyond a shadow of a doubt that although shell companies are not illegal by definition, they are used to carry out a wide array of serious crimes that gobeyond evading taxes.

I decided to expose Mossack Fonseca because I thought its founders, employees and clients should have to answer for their roles in these crimes, only some of which have come to light thus far. It will take years, possibly decades, for the full extent of the firm’s sordid acts to become known.

It’s hard to believe that one law firm from Panama is a major part of the problem throughout the world.

For the record, I do not work for any government or intelligence agency, directly or as a contractor, and I never have. My viewpoint is entirely my own, as was my decision to share the documents with Süddeutsche Zeitung and the International Consortium of Investigative Journalists (ICIJ), not for any specific political purpose, but simply because I understood enough about their contents to realize the scale of the injustices they described.

One person claiming to have done it all by themselves sounds familiar.They seem to fancy their chances of starting a revolution.

Historians can easily recount how issues involving taxation and imbalances of power have led to revolutions in ages past. Then, military might was necessary to subjugate peoples, whereas now, curtailing information access is just as effective or more so, since the act is often invisible.

Yet we live in a time of inexpensive, limitless digital storage and fast internet connections that transcend national boundaries. It doesn’t take much to connect the dots: from start to finish, inception to global media distribution, the next revolution will be digitized.

He goes on, including singling out New Zealand and John Key for a mention.

Of course, those are hardly the only issues that need fixing. Prime Minister John Key of New Zealand has been curiously quiet about his country’s role in enabling the financial fraud Mecca that is the Cook Islands.

That’s all that’s said about here but it has stirred up media and discussions.

Stuff reports on this in Panama Papers whistleblower calls out John Key over silence on ‘fraud Mecca’  and quotes a response from Key:

Key said he was aware he had been singled out over the Cook Islands in the overnight statement, but said it was historic.

Speaking at the National Party northern regional convention in Auckland on Saturday morning, Key said he was confident neither he nor any of his ministers would be on a list of several hundred names due to be released on Monday morning.

“I won’t be on that list. These people have had these papers for a year looking through politicians,” he said.

“I know my own personal situation. I can assure you if I’d been in it or my ministers had been in it, we’d well and truly know by now. He’s made reference to me as the Prime Minister of New Zealand.

“We haven’t seen the papers so we can’t comment in any great note and when we get the chance we’ll work our way through them.”

There will no doubt a lot more attention paid to this as more information becomes available (which is really quite sparse so far).

But The Standard are already relishing the chance to pile more on Key, with two featured posts on it today:

Panama leaker’s statement singles out John Key

Over night the Panama Papers leaker “John Doe” released a “manifesto”.

In it he/she mentioned just one national leader by name, singling out our very own John Key, for his “curious silence”…

Why was John Key singled out by Panama Papers hacker?

Why, out of all the rotten, corrupt and unprincipled nations of the earth, did the Panama Papers hacker single out New Zealand’s John Key for special mention?

Simon Louisson does his best to interweave Key with the post of the supposed source of the Panama papers.

I think that at this stage the self promotion of the next revolution, digitized, is of more note.