Mossack Fonseca closes in Jersey, Isle of Man and Gibraltar, cuts back in Nevada and Wyoming
Wednesday, June 1, 2016 at 9:28AM
Richard L. Cassin in Gibraltar, IIsle of Man, Jersey, Nevada, Panama, Unaoil, VimpelCom, Wyoming

The law firm at the source of the leaked Panama Papers said it's closing its offices in three offshore jurisdictions.

On Twitter Friday, Mossack Fonseca said:

Our offices in Jersey, Isle of Man and Gibraltar will be ceasing operations, but we will continue serving all of our clients.
                   — Mossack Fonseca (@Mossfon)

McClatchy reported last week that Mossack Fonseca's business partner in Wyoming, AAA Corporate Services, cut its ties to the law firm.

In Nevada, Mossack Fonseca's affiliate resigned as the registered agent for 1,024 companies.

On May 20, the Nevada Secretary of State fined M.F. Corporate Services (Nevada) Limited $10,000 (the maximum fine allowed by law) for failing to maintain names and addresses of contact people for companies it administered in the state.

Jersey, Isle of Man, and Gibraltar are British-dependent territories.

In another Tweet Friday about the office closures, Mossack Fonseca said:

This decision has been taken with great regret, as Mossack Fonseca has had a presence in these locations for more than 20 years.

The Panama-based firm has other offices and operations in Belize, The Netherlands, Costa Rica, Malta, Hong Kong, Cyprus, British Virgin Islands, Bahamas, Panama, British Anguilla, Seychelles, and Samoa.

In early April, the Washington-based International Consortium of Investigative Journalists (ICIJ) started publishing the Panama Papers -- more than 10 million records leaked from Panama-based Mossack Fonseca.

Last month the ICIJ launched a searchable database that used the Panama Papers to index 320,000 offshore companies and the people behind them.

The documents named at least a dozen current world leaders and more than 120 other politicians and officials.

It's not always illegal to own or control anonymous companies. But the companies are sometimes used to evade taxes, launder money, and hide assets.

Shruti Shah, a contributing editor of the FCPA Blog and Vice President of Programs and Operations at Transparency International-USA, said, "There are numerous examples of bribe payments being made through shell companies to avoid scrutiny. Recent examples include the VimpelCom case and the allegations against Unaoil."

Anonymous companies have also been used to facilitate domestic corruption and to defraud the federal government and U.S. citizens, she said.

In a statement on its website, Mossack Fonseca said,

[W]e merely help incorporate companies, and before we agree to work with a client in any way, we conduct a thorough due-diligence process, one that in every case meets and quite often exceeds all relevant local rules, regulations and standards to which we and others are bound.

The firm said in nearly 40 years of operation, it hasn't been charged with criminal wrongdoing.

"We’re proud of the work we do, notwithstanding recent and willful attempts by some to mischaracterize it,” the statement said.

After the ICIJ published the Panama Papers, the United States and UK announced steps to restrict the use of anonymous companies.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He'll be the keynote speaker at the FCPA Blog NYC Conference 2016.

Article originally appeared on The FCPA Blog (http://www.fcpablog.com/).
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