Mossack & Fonseca deeply entrenched in Foreign Service

Not only were the two principal Partners of law firm Mossack Fonseca - Jurgen Mossack y Ramón Fonseca Mora - deeply involved in the administration of Juan Carlos Varela, but their family members and associates were and remain deeply entrenched in the Panamanian Foreign Service.

Panamanian foreign minister Isabel De Saint Malo confirmed that Jurgen Mossack only resigned his position on the National Council for Foreign Relations (Conarex, in Spanish) on Wednesday this week, in the wake of the scandal brought about by the publication of the Panama Papers. However, more than one family member of Mr. Mossack and Mr. Fonseca Mora continue to serve in Panamanian consulates around the world. Such is the case of Mr. Peter Mossack, brother to the principal partner all the scandal-hit law firm, whose father served in Nazi Germany’s Luftwaffe, and who remains to this day Honorary Consul in Frankfurt; or of Mr. Eduardo Fonseca Ward, M. Fonseca Mora’s own son, who is serving as consul general in Dubai, in the UAE. According to Ms. Isabel de Saint Malo, there is no need for Mr. Eduardo Fonseca Ward to resign from his consular position, since he does not work for the scandal-hit law firm, and he is not a lawyer [sic]. Ramón Fonseca Mora was until recently one of the principal ministerial counsels to the administration of Mr. Juan Carlos Varela.A flurry of damning publicationsAdding to the damaging news that have hit the image of Panama worldwide, the New York Times recently published an article highlighting how the two founding partners of law firm Mossack & Fonseca knowingly did business for years with dangerous clients from Iran, who were included in the list of all US- sanctioned persons for their presumed links with terrorists organizations.  “Among the leaked documents was an email exchange obtained by the International Consortium of Investigative Journalists, in which the firm’s top partners realized they had worked for years with clients from Iran who had been listed on a sanctions list published by the United States government and the United Nations” the New York Times reported.  

The U.S. sanctions list has the aim of identifying heads of terrorist organizations and political leaders: as transpires in the New York Times article, Mossack & Fonseca “was providing services to all of those notorious human rights violators — Qaddafi, Mugabe, Assad and Putin.” The article also reports how Mr. Mossack related his concerns to Mr. Fonseca Mora in an email to him: “This is dangerous.  A red flag should have been raised immediately.” According to the New York Times, “Mr. Mossack placed blame for the oversight on employees in the law firm’s London office who were “not doing their due diligence thoroughly (or maybe none at all).””.This would seem to contradict the declarations made last Monday by former Presidential adviser Mr. Fonseca Mora. In his television interview, Mr. Fonseca Mora claimed to be unaware of who the final beneficiaries all of the shell companies his law firm incorporates. It was only yesterday that he had to admit that some all the shell companies his law firm created had fallen into the wrong hands.    The New York Times also highlighted how Mossack Fonseca helped obfuscate financial information through a shell company known as MF Nevada, in the United States. Said US company was used to conceal approximately $1.7 billion from the Argentinian Treasury. The US newspaper also refers to how the firm has been linked to the kick-backs scandal that erupted in relation to state-owned oil company Petrobras in Brasil. “In Brazil, Mossack Fonseca was linked to a corruption investigation into bribes paid to politicians by companies doing business with the state-run oil company.Investigators began focusing on the firm after finding an array of apartments in the names of relatives of an imprisoned politician”, the New York Times reported.Were this not enough, Mossack & Fonseca has additionally been linked to an offshore company that has allegedly helped a New York-based art gallerist fight a lawsuit over the misappropriation of Nazi-looted art, filed by the descendants of the original owners.

Meanwhile, the spokesperson the fall of the United States State Department, Mark Toner, admitted that Washington was behind the financing of the journalists that had investigated the “offshore companies” scandal. In spite of the mounting evidence and its damning nature, Panamanian President Juan Carlos Varela has opted for a strategy of confrontational nationalism, threatening retaliatory actions against countries such as France, who have taken a tough stance on the matter of tax evasion.  In defense of his friendPresident Varela studiedly avoided mentioning the name of Mr. Ramon Fonseca Mora in his speeches and declarations, admitting that he would stick to his friend through thick and thin.The New York Times itself highlights the close relationship between President Varela and Fonseca Mora, pointing out how the latter was already an executive party member in the first decade of the 21st century, and how he later became a close and trusted presidential adviser. “Panama’s president has vowed to cooperate with any judicial investigations stemming from the leaked information, which could put him in the awkward position of allowing an inquiry into his former adviser.”In spite of all common sense pointing in the opposite direction, the Panamanian government has so far refused to sever links with Mr. Fonseca Mora's family, and has done nothing to remove Mr. Fonseca Mora's children from their government position. The minister in charge of this matter, Ms. Isabel de Saint Malo, has neither admitted nor denied any wrongdoing on their part, and proposed no action whatsoever.