Category Archives: Australia

The billion-dollar trail that leads straight to Vladimir Putin


AUSTRALIAN companies and individuals are being investigated by the ATO after leaked documents revealed how the world’s super-rich hide their cash.

More than 800 Australian clients of the secretive Panama based law firm, Mossack Fonseca & Co, where the documents came from, are being investigated by the ATO.

An international coalition of media outlets published an extensive investigation into the offshore financial dealings of the rich and famous, based on a vast trove of documents —the so-called Panama Papers — provided by an anonymous source.

The International Consortium of Investigative Journalism, a non-profit organisation based in Washington, said the cache of 11.5 million records detailed the offshore holdings of a dozen current and former world leaders, as well as businessmen, criminals, celebrities and sports stars.

And now the Australian Taxation Office is targeting hundreds of Australians as a result of the leak.


The ATO is examining the dealings of 800 Australian high net worth individuals and has linked more than 120 of them to an associated offshore service provider situated in Hong Kong, The Australian Financial Review reported on Monday.

The ATO told Fairfax some cases may be referred to the Serious Financial Crime Taskforce.

Labor senator Sam Dastyari said the revelations show a broken tax system and a “cat and mouse game”.

“What is so concerning is that some of this activity may even fall within the law,” he told ABC Radio.

Senator Dastyari said tax avoidance was not a victimless act, because every dollar that was siphoned off, didn’t go into Australian schools or hospitals.
The tax office must be congratulated for taking a strong stance, he said.


The leaked records came from the Panamanian law firm, Mossack Fonseca & Co. The firm is one of the world’s top creators of shell companies, which can be legally used to hide the ownership of assets. The firm has offices in 35 cities around the world, including in Hong Kong, Miami and Zurich.

German newspaper Sueddeutsche Zeitung first received the data more than a year ago.

The Munich-based daily was offered the data through an encrypted channel by an anonymous source who requested no monetary compensation and asked only for unspecified security measures, said Bastian Obermayer, a reporter for the paper.

Obermayer said that over the course of several months Sueddeutsche Zeitung received about 2.6 terabytes of data — more than would fit on 600 DVDs. The newspaper said the amount of data it obtained is several times larger than a previous cache of offshore data published by WikiLeaks in 2013 that exposed the financial dealings of prominent individuals.

“To our knowledge this is the biggest leak that journalists have ever worked on,” Obermayer said.

The report is based on a data leak of 11.5 million records for 214,488 entities connected to people in more than 200 countries or territories. The leak includes emails, financial spreadsheets, passport information, corporate records and other sensitive information. It spans nearly 40 years, from 1977 through to the end of 2015.

“In the largest media collaboration ever undertaken, journalists working in more than 25 languages dug into Mossack Fonseca’s inner workings and traced the secret dealings of the law firm’s customers around the world,” the report said.

“They shared information and hunted down leads generated by the leaked files using corporate filings, property records, financial disclosures, court documents and interviews with money laundering experts and law-enforcement officials.”

The consortium said it will release the full list of companies and individuals identified in the data in early May.


The report into the documents revealed a network of secret offshore deals and vast loans worth $2.6 billion has laid a trail to Putin, reports The Guardian.

According to the report, an unprecedented leak of documents shows how this money has made members of Putin’s close circle rich.

The report revealed associates of Russian President Vladimir Putin have moved as much as $2.6 billion through offshore accounts.

The offshore trail reportedly starts in Panama, darts through Russia, Switzerland and Cyprus — and includes a private ski resort where Putin’s younger daughter, Katerina, was married in 2013.
In Russia, the Kremlin last week said it was anticipating what it called an upcoming “information attack.”

Putin’s spokesman, Dmitry Peskov, told reporters that the Kremlin had received “a series of questions in a rude manner” from an organisation that he said was trying to smear Putin.
“Journalists and members of other organisations have been actively trying to discredit Putin and this country’s leadership,” Peskov said.


But Putin isn’t the only one who has been exposed.

The leak has impacted more than 200,000 companies, foundations and trusts.

— Offshore companies have been linked to the family of Chinese President Xi Jinping.

— Icelandic Prime Minister Sigmundur David Gunnlaugsson and his wife secretly owned an offshore firm holding millions of dollars in Icelandic bank bonds during the country’s financial crisis.

— The law firm of a member of FIFA’s ethics committee, Juan Pedro Damiani, had business ties with three men indicted in the FIFA scandal: former FIFA vice president Eugenio Figueredo, as well as Hugo Jinkis and his son Mariano who were accused of paying bribes to win soccer broadcast rights in Latin America.

— Argentine football great Lionel Messi and his father owned a Panama company, Mega Star Enterprises Inc., a shell company that had previously not come up in Spanish investigations into the father and son’s tax affairs.

At least 33 people and companies in the documents were black-listed by the US government for wrongdoing, such as North Korea and Iran, as well as Lebanon’s Hezbollah, the ICIJ said.
Names also figuring in the leak included;

— The deceased father of British Prime Minister David Cameron.

— Former Egyptian President Hosni Mubarak.

— Syrian President Bashar al-Assad.

— The president of Ukraine Petro Poroshenko,

— The king of Saudi Arabia.

— Former Libyan leader Muammar Gaddafi.

— The prime minister of Pakistan Nawaz Sharif.

— Argentine President Mauricio Macri.

— Pilar de Borbon, the sister of former Spanish King Juan Carlos.

— Spanish film director Pedro Almodovar.

The leaked data provides what the ICIJ described as a “never-before-seen view inside the offshore world.”

“These findings show how deeply ingrained harmful practices and criminality are in the offshore world,” said Gabriel Zucman, an economist at the US-based University of California, Berkeley, cited by the consortium.

Most of the services the offshore industry provides are legal if used correctly the ABC reported but as the leaked documents show some will go to extreme lengths to hide the true owners of companies which makes it hard for authorities to investigate money laundering.

Mossack Fonseca says it had never been charged for criminal wrongdoing in its efforts to help clients launder money, dodge tax and circumvent financial sanctions.
One of the law firm’s founders, Ramon Fonseca, told AFP the leaks were “a crime, a felony” and “an attack on Panama”.

“Certain countries don’t like it that we are so competitive in attracting companies,” he said.

Panama’s government said it had “zero tolerance” for any shady deals, and vowed to “vigorously cooperate” with any legal investigations.


The leaked documents also revealed that New Zealand is being used as a tax haven by foreign politicians.

Malta energy minister Konrad Mizzi and the prime minister’s chief of staff Keith Schembri set up two offshore trusts in New Zealand in 2015 through the firm.

The two trusts are linked to Panama-based companies.

The revelations triggered wide-scale protests in Malta last month, with thousands taking part in a rally demanding the resignations of the two political figures.

Mizzi admitted in February that he and his wife had set up a trust in New Zealand to manage their assets.

He said he would close down his company in Panama but retain his trust in New Zealand.

There are reportedly thousands of foreign trusts registered in New Zealand — which do not pay local tax on offshore earnings — with their beneficiaries not registered with any public body.

The New Zealand link forms part of a larger investigation into the document dump, dubbed the Panama Papers, which were obtained by German newspaper Sueddeutsche Zeitung.

Sueddeutsche said an employee at the law firm had leaked the data, telling the newspaper he risked his life in doing so. The employee was not identified in the report.

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West Needs to Up the Ante in Infowar

The West is finally coming to a belated comprehension of the power of the Kremlin media machine. The Soviet Union is no more, but the Kremlin holds a media hegemony over 142 million citizens of Russia and 93 million residents of former Soviet republics, for whom Russian is a native language, or fluent second language.

The European Endowment for Democracy project that I co-authored sought a solution to this problem. Our research led us to an understanding of how different the situation is today than during the Cold War era.

In the 20th century, the goal of Western media broadcasts in Russian, like the BBC World Service and Radio Free Europe, was to get information through the Iron Curtain. The battle was fought for alternative points of view against censorship. Today, television is under the strict control of the Kremlin, but the public has access to different media sources through the Internet.

Russian-speaking citizens of Ukraine, Moldova, and the Baltics can get information from a wide range of sources: Kremlin-run, local, or Western, all providing sharply contradictory versions of reality.

A good example is Estonia, whose residents, after hearing the competing Russian and Western versions of the events surrounding the downing of Malaysia Airlines Flight MH17 over Ukraine last year, lost faith in reports from both sides.

The Kremlin blurs the boundary between fact and fiction. Informational and analytical segments are prepared using cinematic techniques and sensationalism. The disinformation is arranged into a coherent narrative. News shows concentrate on military actions in Ukraine, Western conspiracies against Russia, and positive stories about President Vladimir Putin. The president ensures stability in a country surrounded by enemies.

These emotions are intensified through costly documentary films about the glorious battles of World War II and betrayal by liberals, dishonoring themselves by collaborating with enemies of the motherland.

Meanwhile, the Kremlin-run media ignores the local news and important social issues. Analysts from the European Endowment for Democracy recommended creating a news agency that would concentrate on those very details that Moscow strives to avoid.

This type of media source would be unlikely to succeed, nor should it try, in convincing its audience of the veracity of one particular version of the events surrounding a passenger plane crash in Ukraine, for example, but it could focus on local stories about hospitals, schools, and courts, and therefore be more relevant.

Ideally, this approach to program creation should correspond to development priorities. When the British Department for International Development supports judicial reform in Ukraine or Moldova, that should be accompanied by the production of television shows and documentaries about the workings of the judicial system. The BBC charity Media Action is already helping Ukrainian public television prepare short films about the lives of young people in a conflict zone. The budget for this project is tiny, but such projects are essential.

High-quality shows aren’t cheap. A full-fledged television project like BBC Russia would cost at least 20 million euros a year. Putin knows well that the media is just as important as doctors and soldiers. The West made a big mistake in the 1990s when they left media development in the former Soviet Union to the will of the free market. The media was seized by oligarchs and corrupt regimes.

Reducing financing for media sources like Radio Free Europe was seen as a peacetime bonus in the West. But today, the cost of those savings is high.

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MH17: Malaysia looking at “Plan B” to bring justice for victims

Malaysia is in early discussions with Belgium, the Netherlands, Ukraine and Australia to go ahead with “Plan B” to bring justice for those killed onboard MH17, Malaysian Transport Minister Liow Tiong Lai said, according to The Star.

“We felt sad when Russia rejected the proposal for the setting up of an international tribunal through a veto vote but we are working on an alternative,” Lai said, according to the paper. “(It’s) either that we will form a multi-state court or bring this matter to the International Criminal Court.”

The Malaysia Airlines flight from Amsterdam to Kuala Lumpur was shot down over Ukrainian airspace on July 17, 2014. All 298 people on board the aircraft were killed.
Russia blocked the setting up of a UN tribunal saying it was premature, ill-defined and unfounded.

ED: Yea….”Unfounded”

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Suspected Russian Missile Parts Found at MH17 Crash Site

Parts of a suspected Russian missile system have been found at the site in eastern Ukraine where Malaysia Airlines Flight 17 was brought down last year, killing all 298 people on board.

Dutch prosecutors made the announcement on Tuesday, saying the parts, possibly from a Buk surface-to-air system, “are of particular interest to the criminal investigation as they can possibly provide more information about who was involved in the crash of MH17.”

Prosecutors had previously said they were treating a missile strike as the most likely scenario, but Tuesday’s statement was the first time they have described possible physical evidence of a missile.

However, they cautioned that the discovery did not prove there was “a causal connection between the discovered parts and the crash of flight MH17.”

MH17 was traveling from Amsterdam to Kuala Lumpur and most of the passengers were Dutch.

Pro-Russia fighters have been accused of shooting down the plane using a Buk missile system supplied by Russia. But both rebels and Russia deny any responsibility, in turn blaming the Ukrainian military.

A joint investigation team, made up of representatives from the Netherlands, Ukraine, Malaysia, Australia, the UK, US, and Russia, is due to publish a report on the causes of the crash in October.

Last month Russia vetoed a United Nations Security Council Resolution that would have created a tribunal to prosecute and punish anyone found responsible.

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Putin’s war on the West

HE IS ridiculed for his mendacity and ostracised by his peers. He presides over a free-falling currency and a rapidly shrinking economy. International sanctions stop his kleptocratic friends from holidaying in their ill-gotten Mediterranean villas. Judged against the objectives Vladimir Putin purported to set on inheriting Russia’s presidency 15 years ago—prosperity, the rule of law, westward integration—regarding him as a success might seem bleakly comical.

But those are no longer his goals, if they ever really were. Look at the world from his perspective, and Mr Putin is winning. For all his enemies’ machinations, he remains the Kremlin’s undisputed master. He has a throttlehold on Ukraine, a grip this week’s brittle agreement in Minsk has not eased. Domesticating Ukraine through his routine tactics of threats and bribery was his first preference, but the invasion has had side benefits. It has demonstrated the costs of insubordination to Russians; and, since he thinks Ukraine’s government is merely a puppet of the West (the supposed will of its people being, to his ultracynical mind, merely a cover for Western intrigues), the conflict has usefully shown who is boss in Russia’s backyard. Best of all, it has sown discord among Mr Putin’s adversaries: among Europeans, and between them and America.

His overarching aim is to divide and neuter that alliance, fracture its collective approach to security, and resist and roll back its advances. From his tantrums over the Middle East to his invasion of Georgia and multiple misadventures in Ukraine, Mr Putin has sometimes seemed to stumble into accidental disputes with the West, driven by a paranoid fear of encirclement. In hindsight it seems that, given his outlook, confrontation may have been inevitable. Either way, the contest he insists on can no longer be dodged. It did not begin in poor Ukraine and will not end there. Prevailing will require far more resolve than Western leaders have so far mustered.

What the Kremlin wants

Last year Mr Putin lopped off Crimea, redrawing Europe’s map by force. The war he hallucinated into reality in eastern Ukraine has killed thousands. Even if the ceasefire scheduled for February 15th holds (unlikely, on past form), he seems certain to get what he wants there: a wretched little quasi-state in the Donbas, which he can use to stall and warp Ukraine’s development. Yet these incursions are only his latest bid to bludgeon former Soviet states into submission, whether through energy blackmail, trade embargoes or war. For Mr Putin the only good neighbour is a weak one; vassals are better than allies. Only the wilfully blind would think his revanchism has been sated. Sooner or later it may encompass the Baltic states—members of both the European Union and NATO, and home to Russian minorities of the kind he pledges to “protect”.

The EU and NATO are Mr Putin’s ultimate targets. To him, Western institutions and values are more threatening than armies. He wants to halt their spread, corrode them from within and, at least on the West’s fragile periphery, supplant them with his own model of governance. In that model, nation-states trump alliances, states are dominated by elites, and those elites can be bought. Here, too, he has enjoyed some success. From France to Greece to Hungary he is cultivating parties on Europe’s far right and left: anyone who might lobby for Russian interests in the EU, or even help to prise the union apart (see pages 19-22). The biggest target is NATO’s commitment to mutual self-defence. Discredit that—by, for example, staging a pro-Russian uprising in Estonia or Latvia, which other NATO members decline to help quell—and the alliance crumbles.

Mr Putin’s stranglehold on his own country means he has time and freedom for this campaign. As he has amply demonstrated, he has no qualms about sacrificing Russians’ well-being to satisfy his coterie’s greed or to further his geopolitical schemes. He persecutes those who protest. And in the echo chamber his propaganda creates, the nationalism he peddles as a consolation for domestic woes is flourishing.

What is to be done?

The first task for the West is to recognise the problem. Barack Obama has blithely regarded Russia as an awkward regional power, prone to post-imperial spasms but essentially declining. Historians will be amazed that, with Ukraine aflame, the West was still debating whether to eject Russia from the G8. To paraphrase Trotsky, Western leaders may not have been interested in Mr Putin, but Mr Putin was interested in them.

The next step is to craft a response as supple as the onslaught. Part of the trouble is that Mr Putin plays by different rules; indeed, for him, there are no inviolable rules, nor universal values, nor even cast-iron facts (such as who shot down flight MH17). There are only interests. His Russia has graduated from harassing ambassadors and assassinating critics to invasions. This is one of his assets: a readiness to stoop to methods the West cannot emulate without sullying itself.

The current version of this quandary is whether, if the latest ceasefire fails, to arm Ukraine. Proponents think defensive weapons would inflict a cost on Mr Putin for fighting on. But anyone who doubts his tolerance of mass casualties should recall his war in Chechnya. If arms really are to deter him, the West must be united and ready to match his inevitable escalation with still more powerful weapons (along, eventually, with personnel to operate them). Yet the alliance is split over the idea. Mr Putin portrays the war as a Western provocation: arming Ukraine would turn that from fantasy to something like fact, while letting him expose the limits of Western unity and its lack of resolve—prizes he cherishes. If fresh Russian aggression galvanises the alliance, arming Ukraine will become a more potent threat. Until that point, it would backfire.

A better strategy is to eschew his methods and rely on an asset that he, in turn, cannot match: a way of life that people covet. If that seems wishy-washy beside his tanks, remember that the crisis began with Ukrainians’ desire to tilt towards the EU—and Mr Putin’s determination to stop them. Better than arms, the West must urgently give Ukraine as much aid as it needs to build a state and realise that dream (and as much advice as it takes to ensure the cash is not misspent or stolen). The IMF deal announced on February 12th should be only a start. Mr Putin wants Ukraine to be a lesson in the perils of leaning West. It should instead be an exemplar of the rewards.

Just as urgently, those former Soviet countries that have joined Western institutions must be buttressed and reassured. If the case for sending arms to the Donbas is doubtful, that for basing NATO troops in the Baltics is overwhelming, however loudly Mr Putin squeals. Western leaders must make it clear, to him and their own people, that they will defend their allies, and the alliance—even if the struggle is covert and murky.

And it isn’t only its allies who appreciate the West’s virtues. So do many Russians, including shameless Putinists who denounce the West’s decadence but exploit its schools and stockmarkets. It is long past time for every Russian parliamentarian and senior official to join the sanctions list. Far from being relaxed as, after Minsk, fellow-travellers may suggest, sanctions must be tightened—and sanctions-busting curtailed (see page 64). In the end, they will prove a stronger lever than weapons.

At the same time, the West should use every available means to help ordinary Russians, including Russian-sympathisers in the Baltics and Ukraine, learn the bloody, venal truth about Mr Putin. It should let them know that Russia, a great nation dragged down a terrible path, will be embraced when it has rulers who treat the world, and their own people, with respect not contempt, however long that takes.

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“A year on from the downing of MH17, this was precisely the moment to establish a tribunal.”

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Explanation of Vote by Ambassador Matthew Rycroft of the UK Mission to the UN at the Security Council Meeting on MH17

Thank you Mr President – Foreign Minister. And I thank the representatives from Malaysia, the Netherlands, Australia and Ukraine for marking this occasion with their presence.

The United Kingdom is deeply saddened, frustrated and disappointed that Russia has vetoed this resolution today. This resolution was about securing justice for the 298 people, including 80 children and 10 British nationals, who lost their lives onboard Malaysia Airlines flight MH17. Russia’s veto disrespects the victims and insults their families.

Through resolution 2166, the Security Council unanimously agreed that those responsible for this incident be held to account and demanded that all States cooperate fully with efforts to establish accountability. With its veto, Russia is not meeting that demand.

The Security Council had the opportunity today to start a process that would have brought justice and accountability for the families of all those who lost their lives. There are clear precedents for the Council taking this kind of action; securing international support for the Lockerbie trial and establishing the ICTY and the Special Tribunal for Lebanon, to name but a few.

A year on from the downing of MH17, this was precisely the moment to establish a tribunal, to send a clear and unambiguous message that this Council will not tolerate impunity; that this Council has a clear responsibility to address violent acts which constitute a threat to international peace and security.

So we reject the Russian allegation that this resolution was an unnecessary and premature move and that the Security Council should have waited for the investigations to conclude. An operational and fully staffed tribunal takes time to set up. Had we started that process today, the tribunal would have been ideally placed to act on the outcome of the investigations.

Mr President,

Despite Russia’s veto, the investigations will continue. The investigators have been exemplary in their professionalism and integrity, working in the most challenging circumstances. We reject any allegations to the contrary.

Russia has been involved in both investigations. The Russian Federal Air Transport Agency has actively participated in the technical investigation. And it has contributed material to the criminal investigation. It is damaging that Russia has chosen to block the best route to establishing a tribunal for that criminal investigation to reach a conclusion. It is through these investigations that we will bring those responsible to account, as resolution 2166 demands. The veto today will not prevent that; the perpetrators of this terrible crime should find no comfort in Russia’s actions today. There must be accountability and the international community now needs to unite to make that happen.

Let me conclude Mr President, by returning to the victims. To them, MH17 was meant to be a routine flight to Kuala Lumpur. A business trip, a holiday, a stop-over before a conference. Instead, all 298 people onboard lost their lives in a remote part of eastern Ukraine, far from home, far from those they loved and far from those who loved them. They, and those that they left behind, deserve justice. Despite Russia’s actions today, we will not give up in our pursuit of that goal.

Thank you.

Russia’s Putin Voices Opposition to International Tribunal for MH17

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Russian President Vladimir Putin said on Wednesday he opposed the creation of an international tribunal to prosecute those who shot down a Malaysian airliner over eastern Ukraine, hours before a U.N. vote on such a proposal.

Putin’s comment was the latest to indicate Russia may block moves at the United Nations, co-sponsored by the Netherlands, to set up a UN-backed tribunal into the downing of Malaysia Airlines flight MH17 in July 2014.

Kiev and many Western countries accuse pro-Russian separatists in east Ukraine of shooting down the plane with a Russian-made missile, charges Moscow denies.

All 298 people on board, the majority of them Dutch, were killed and the Netherlands is leading an international investigation into the incident.

“The Russian president confirmed the unchanging position that it is inexpedient to create such a judicial body,” the Kremlin said in a statement following a phone call between Putin and Dutch Prime Minister Mark Rutte.

The Dutch, along with Malaysia, Australia and most Western countries, are pushing for the tribunal, which they say would have the authority to investigate impartially and demand the extradition of suspects, whichever country might be harboring them.

Russia has said setting up a tribunal before investigations are complete would risk further politicizing the incident. Putin also regretted that Russia’s own draft resolution, which demands justice for the victims but does not establish a tribunal, did not win the U.N. Security Council’s backing.

The Netherlands said in a statement that it believed a tribunal would be the best way of achieving impartial justice.

“In order to avoid the risk of politicizing justice, it is best to set up the tribunal before deciding what the circumstances of the crash were,” the Dutch government said.

The downing of the plane triggered a new round of Western economic sanctions against Russia over the conflict in Ukraine, and deepened the worst stand-off between Moscow and the West since the Cold War ended.

More than 6,500 people have been killed in more than 15 months of fighting in east Ukraine between the rebels and forces loyal to Kiev.