Europol links 3,500 names on Panama Papers to suspected criminals

Almost 3,500 individuals and companies in the Panama Papers are probable matches for suspected criminals including terrorists, cybercriminals and cigarette smugglers, media sources claim.

The Guardian said it had seen a document containing an analysis carried out by Europol, which sheds more light on the breadth of criminal behaviour facilitated by tax havens around the world.

“The main point here is that we can link companies from the Panama Papers leaks not only with economic crimes, like money laundering or VAT carousels, but also with terrorism and Russian organised crime groups,” Simon Riondet, head of financial intelligence at Europol, told a committee of MEPs.

The Panama Papers, leaked files from the offshore services company Mossack Fonseca, revealed that hundreds of people, including the  wealthy and the powerful, had used offshore companies to hide their riches.

While the use of offshore structures is legal, critics have long alleged that they can also be used to facilitate improper or unlawful behaviour.

The memo was prepared for a European parliamentary committee investigating how the offshore world can be used to facilitate tax abuse and international crime.

According to the memo, Europol compared a publicly available version of the Panama Papers published by the International Consortium of Investigative Journalists with its own databases of individuals and companies suspected of criminal involvement and identified 3,469 probable matches .

According to the Guardian, it matched 1,722 names in the Panama Papers with entities that had been reported by EU member states as having been involved in potential money-laundering transactions. A further 516 of the matches were connected to eastern European organised criminal gangs, 388 were connected to VAT fraud operations, and 260 to cigarette smuggling operations. It said 116 of the names were connected to “Hydra” – a Europol codeword for Islamist terrorism, according to the document – while 99 related to “Cola”, or drug crime.

The document identifies “the use of corporate service providers by criminals to acquire large numbers of shell companies (including finding third parties for positions within the company) located in offshore/tax havens (usually under the form of holding companies or trusts)” as one such scheme.

Separately to its analysis of the Panama Papers, the Europol briefing also suggests that Luxembourg, widely known as a major tax haven for multinational corporations, is also failing to tackle money-laundering offences.

“Reporting figures across the EU do not always appear to be commensurate with the activities of the regulated sector in particular jurisdictions: notably Cyprus and Malta and Luxembourg receive very few reports given the significance of these jurisdictions in offshore financial service and the online gambling industry,” the memo reads.

“Furthermore, the vast majority of reports filed with Luxembourg stem from a single electronic bank/payment service provider, in spite of the fact that other sectors, such as private banking and offshore financial services, offer significant scope for money-laundering activities and tax crimes.”

Separately, Giovanni Kessler, the director general of OLAF, the European anti-fraud office, told the MEPs his agency had opened four investigations into potential cases of fraud against the European Union “on the basis of an analysis of information related to the Panama Papers and of information obtained from other sources”.