Prime Minister Narendra Modi on Monday ordered a multi-agency probe team on the global expose by International Consortium of Investigative Journalists (ICIJ), dubbed the "Panama Papers", which found over 500 Indians also had alleged offshore links.
"A multi-agency group is being formed to monitor the black money trail," Finance Minister Arun Jaitley said here after the expose was published in The Indian Express. "Details of the assets worth Rs.6,500 crore has already been found," he added.
As per a statement issued by his ministry, the probe team will comprise officers from the Central Board of Direct Taxes' Financial Intelligence Unit, its Tax Research Unit as also officials from the Reserve Bank of India.
"The group will monitor the flow of information in each one of the case. The government will take all the necessary actions as required to get maximum information from all sources including from foreign governments to help in the investigation process," the statement added.
The journalists' consortium had said late on Sunday that its members and more than 100 other news organisations around the globe have found offshore links of some of the planet's most prominent people. The list included over 500 Indians.
The details of the Indians with such offshore funds were published in The Indian Express. But whether or not such funds exist, and also if they were illegal is what the probe team ordered by Modi is expected to look into.
"In terms of size, the Panama Papers is likely the biggest leak of inside information in history - more than 11.5 million documents - and it is equally likely to be one of the most explosive in the nature of its revelations," the consortium said of its investigation published.
In the context of the commitment of the central government to bring out undisclosed money both from abroad and from within the country, information brought out by any investigative journalism was welcome, the finance ministry said.
The ministry said in the past too, based on the investigations by ICIJ in 2013 -- that showed the links of 700 Indians with business connection with off-shore entities -- the agencies of the government were able to identify 434 persons as Indian residents.
It also said 184 persons admitted their relationship with such off-shore entities/transactions.
"Although, in the previous report of ICIJ, information relating to financial transactions/bank accounts was not available, the government authorities have detected credit in the undisclosed foreign accounts of such Indian persons in excess of Rs.2,000 crores."
As a consequence, 52 prosecution complaints have been filed against the alleged offenders so far.
"The government is committed to detecting and preventing the generation of black money. In this context the expose of Panama Papers will further help the government in meeting the objective," the finance ministry added.
The government expressed concern that tax havens were making countries like India suffer tax losses.
"The recent initiative of 'Base Erosion' and 'Profit Shifting' (BEPS) will help India and other countries in checking the practice of tax-avoidance through such tax havens. India is also fully committed to the BEPS initiative."
In India, The Indian Express ran several pages of the investigation reports alleging, among other names, Bollywood superstarts Amitabh Bachchan and Aishwarya Rai, being directors in companies in Panama.
The two did not immediately respond despite efforts to contact them. Aishwarya Rai's media adviser told the newspaper that the information was false. The spokesperson for Aishwarya Rai said "no" when IANS asked her if she intended to issue a statement.
Among those named in the report were Sameer Gehlaut of India Bulls and K.P. Singh of DLF. Vinod Adani, elder brother of industrialist Gautam Adani, politician Shishir Bajoria from West Bengal and Anurag Kejriwal of Loksatta Party were also alleged to have set up companies in tax havens.
Bajoria told the paper that that "erroneous beneficial owner information" was given by mistake.
The Express said it had carried out the investigations spread over eight months with several global newspapers. Many of the other persons named in the Express reports responded, some denying while others maintaining that they had worked within the laws of the country.
Among the global leaders named were 12 current and former world leaders, including Pakistan Prime Minister Nawaz Sharif's family members. It also sought to reveal how associates of Russian President Vladimir Putin secretly shuffled as much as $2 billion through banks and shadow firms.
In Russia, the state-run media organisations were silent on the subject. In Pakistan, however, Sharif's son Hussain told Geo News that his family had not done anything wrong.
ROYAL BANK SAYS IT OPERATES WITHIN LAW AFTER LEAK OF PANAMA PAPERS
The Royal Bank of Canada says it operates within the law and has policies to prevent tax evasion after reports said it used the Panamanian law firm whose leaked documents are said to reveal the use of offshore tax havens.
The International Consortium of Investigative Journalists worked with hundreds of journalists to analyze 11.5 million records from the law firm Mossack Fonseca.
The records reportedly show major banks helped clients create companies in offshore havens like Panama.
Mossack Fonseca has confirmed the authenticity of the records that hackers obtained.
The firm denies any wrongdoing and says most of the individuals named in the leaked documents were not its direct clients but accounts set up by intermediaries.
The CBC and the Toronto Star, two of the media outlets that the consortium collaborated with, reported that the Royal Bank of Canada and its subsidiaries set up about 370 of these types of corporations.
"RBC works within the legal and regulatory framework of every country in which we operate," the Royal Bank said in a statement. "Tax evasion is illegal, and we have established controls, policies and procedures in place to detect it and prevent it occurring through RBC."
The bank said there are legitimate reasons to set up a holding company but if it believes a client intends to commit a criminal offence by evading taxes, it would report that and not serve the client.
The leaked documents reportedly show the offshore dealings of more than 100 politicians and public figures from multiple countries, including Iceland, Ukraine, Pakistan and Russia.
ICELAND'S PM SAYS HE WON'T RESIGN IN PANAMA PAPERS SCANDAL
REYKJAVIK, Iceland — Iceland's prime minister told parliament Monday he will not resign after documents leaked in a media investigation linked him to an offshore company that could represent a serious conflict of interest.
"I have not considered quitting because of this matter nor am I going to quit because of this matter," a defiant Sigmundur David Gunnlaugsson told parliament. "The government has had good results. Progress has been strong and it is important that the government can finish its work."
As he left the building, large protests were developing in the capital, Reykjavik, outside the parliament.
News reports have alleged that Gunnlaugsson and his wife set up a company in the British Virgin Islands with the help of a Panamanian law firm at the centre of a massive tax evasion leak. The reports have prompted calls for a no-confidence vote in parliament against him.
He told parliament he and his wife have paid all their taxes in full and he denied having assets in a tax haven. Gunnlaugsson also said there was nothing new in the information contained in the Panama Papers data leak.
A variety of opposition figures still called for him to leave office and have called for a no-confidence vote against his centre-right government.
The revelation concerns the company Wintris Inc., which Gunnlaugsson allegedly created in 2007 along with his partner at the time, Anna Sigurlaug Palsdottir, who is now his wife.
He allegedly sold his half of the company to Palsdottir for $1 on Dec. 31, 2009, the day before a new Icelandic law took effect that would have required him to declare the ownership of Wintris as a conflict of interest.
Wintris lost money as a result of the 2008 financial crash that crippled Iceland, and is claiming a total of 515 million Icelandic kronur ($4.2 million) from the three failed Icelandic banks: Landsbanki, Glitnir, and Kaupthing.
Gunnlaugsson has been accused by opposition leaders of a serious conflict of interest because as prime minister he was involved in reaching a deal for the banks' claimants. Former Prime Minister Johanna Sigurdardottir called for Gunnlaugsson's resignation, as did Birgitta Jonsdottir, the popular head of the Pirate Party.
Gunnlaugsson, the head of the centre-right Progressive Party, began his four-year term in 2013, five years after Iceland's financial collapse.
Iceland, a volcano-dotted North Atlantic nation with a population of 330,000, went from being an economic superstar to financial basket case almost overnight when its main commercial banks collapsed within a week of one another in 2008.
LEAKS ABOUT OFFSHORE ACCOUNTS LEAVE RUSSIANS UNIMPRESSED
In the list of presidents, prime ministers, sheikhs, billionaires and other magnates cited in a sweeping worldwide investigation into hidden assets in offshore accounts, there was an odd man out: A Russian cellist.
Up until now, 64-year-old Sergei Roldugin was known only in the Russian music community — as a People's Artist of Russia and the artistic director of the House of Music in St. Petersburg. What makes him stand out from other Russian musicians, however, is his close ties to President Vladimir Putin.
Roldugin features in Putin's early autobiography as a close friend and the godfather of Putin's eldest daughter, Maria. He pursued a musical career, and despite the fact that he never became a tycoon like many of Putin's other friends, he did somehow acquire a stake in the Rossiya bank, one of the first Russian firms slapped with U.S. sanctions following Russia's 2014 annexation of Crimea.
The U.S. Treasury in 2014 described the bank as being "designated for providing material support to government officials" and co-owned by members of Putin's inner circle. But unlike other Putin friends who have built flourishing businesses in Russia, Roldugin, whose stake in Rossiya was reported at 3.3 per cent, was not slapped with sanctions.
A myriad of documents that the Washington-based International Consortium of Investigative Journalists gained access to showed Roldugin — or someone posing as him — skillfully operating affiliated companies that controlled a significant share of a business empire that earned tens of millions of rubles per day from murky deals. The companies received millions from Putin's friends and Russian billionaires as well as preferential loans from a Russia-controlled Cyprus-based bank.
The journalists who analyzed the leaked documents from the Panamanian law firm Mossack Fonseca, one of the world's biggest creators of shell companies, say the combined turnover of a company that Roldugin is reported to have owned through an intermediary between 2009 and 2012 was around $2 billion.
When the Novaya Gazeta newspaper, which led the ICIJ investigation in Russia, approached Roldugin after a concert, the cellist had a friendly chat with the reporter but refused to talk about the offshore companies, saying the subject was "delicate."
Roldugin was unavailable for comment on Monday. A receptionist at the St. Petersburg House of Music said he was not in.
The release of what has become known as the Panama Papers has sent officials in countries around the world scrambling. Some have pledged to investigate claims of possible tax evasion, others like the prime minister of Iceland and the president of Ukraine face political storms over their alleged involvement in offshore companies.
In Russia, however, the trove of documents showing a money trail leading close to the president has gone largely unnoticed.
Following hours of silence, state-owned Channel One in its 6 p.m. bulletin reported the story, leading with the denial by Putin's spokesman, Dmitry Peskov, and mentioning the dealings involving the Ukrainian president. The TV report said "many wonder" what could have triggered the investigation and alleged that the leak may have been a U.S.-orchestrated attempt to remove Panama as a tax haven since it is competing for tax revenue.
Peskov blamed Western media for focusing on Putin even though he was not directly linked to any offshore activity.
He suggested the ICIJ had ties to the U.S. government. The ICIJ is not funded by the government and is part of the non-profit, non-partisan Center for Public Integrity.
"It's obvious that there are many journalists there whose main profession is unlikely to be journalism," he said, alleging that "former employees of the State Department, the CIA, other security services" may have been involved in the publication of the leaks.
Peskov said Roldugin was a friend of Putin's but added the president "has very many friends."
In past years, as Putin's friends were building fortunes by getting lucrative state contracts with no or little competition, independent media in Russia have published countless investigations suggesting a conflict of interest at the least — or possibly major corruption. These reports, however, did not lead to any official investigations, Russian government reshuffling or public discontent.
Arguably the only exception was last year's protest by truck drivers who rallied against a hefty new road tax imposed by a company co-owned by a son of one of Putin's friends.
Russian experts said even if the offshore scandal was getting coverage on Russian television, Putin will still come out of it unscathed.
"There aren't any accounts directly connecting Putin to the companies, but even if there were, it is unlikely that this would shock his supporters in Russia," Alexander Baunov of the Carnegie Center in Moscow told The Associated Press.
Putin's detractors, he said, are looking in the wrong places for problems that could potentially destabilize his government.
What could be disastrous for Putin? "Anything that brings Russia back to the 1990s," said Baunov, referring to the withholding of salaries and a slump in living standards.
In a country where all officials are believed to be corrupt by default, a revelation of corruption in Putin's inner circle or even his own misdeeds are not viewed as much of a sin.
"In a healthy society, all those friends of the national leader would already be behind bars while the leader himself would be a pariah," Dmitry Gudkov, the only Russian lawmaker who voted against the Crimean annexation said in a blog Monday. "In our (society) the reaction is: 'So what? He does not drink newborn babies' blood, thanks for this.' We know things could be worse."
While Russian opposition activists were fuming on social media about the Panama Papers revelations, the reports left many more Russians unmoved.
"Seriously, if someone had posted a photo of Putin watching 'Peppa Pig' it would have caused more of a stir," blogger Ilya Varlamov tweeted, referring to a popular cartoon series.
Unlike the reclusive banker Yuri Kovalchuk or Putin's childhood friend Arkady Rotenberg, the soft-spoken Roldugin has never hidden from the press, giving interviews about his love for music and Russian musical talent.
"I don't like talking about Putin. It's private, I hope you understand," Roldugin said in a 2014 interview.
But when asked where he thinks Putin's government is failing, he said: "I think there is not enough effort to fight corruption in Russia. I would like to see more decisive action."
