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Global Tax Evasion Inquiry

Posted in Offshore Account Update on April 29, 2016 | Share

Mossack Fonseca is a law firm in Panama whose massive database of client records was recently leaked. The leak, referred to as The Panama Papers, revealed tax evasion and money laundering on a global scale.

The Panama Papers included the names and information of high-profile politicians and wealthy individuals from countries all over the world. The leak provided an unprecedented glimpse into the inner workings of law firms, banks and investors with offshore accounts. 

The firm has now had its offices raided, according to The Guardian. The raid occurred as tax investigators from countries across the globe prepare to meet in Paris where an “unprecedented inquiry into global tax evasion” will take place.  This unprecedented inquiry could result in many people worldwide finding their accounts under scrutiny and even finding themselves facing criminal charges.

As the global crackdown on tax evasion continues, anyone with undeclared offshore accounts needs to talk with a Washington DC criminal tax lawyer as soon as possible to find out about options for voluntary disclosures that can provide amnesty from prosecution.

More About the Raid

Taxing authorities who are meeting in Paris plan to analyze the documents leaked in the Panama Papers as part of new global strategies to identify tax evaders worldwide. The Joint International Tax Shelter Information and Collaboration (Jitsic) network is leading the new aggressive approach aimed at stopping tax evasion.

The Paris meeting is being chaired by the head of international tax from Australia's tax office, but will be attended by authorities from many different countries.  The Panama Papers will provide these officials with a detailed, unfiltered, real-world picture of how tax evasion works behind the scenes.

While the Panama Papers provides extensive information, investigators believe there may be even more useful data held by Mossack Fonseca. Mossack Fonseca is the fourth largest offshore law firm, and its specialization is incorporating companies in offshore jurisdictions. Mossack Fonseca has denied wrongdoing, claiming it only set up shell companies and offshore accounts for clients but wasn't involved with how the accounts were used.

Panama's attorney general ordered a raid on the Panamanian offices of the firm “to establish the use of the firm for illicit activities.”  If the firm is found to be implicated in breaking the law in an effort to help clients evade tax obligations, criminal charges could result. 

Panama has come under scrutiny, and France had decided to put Panama on a list of uncooperative countries for offering financial information.  Panama has been making an effort to cooperate with other countries, including creating an international panel to review legal and financial practices.  Panama's raid of Mossack Fonseca may be part of an attempt to show a good faith effort to cooperate in the fight against tax evasion.

The raid on Mossack Fonseca is part of a long string of efforts to impose accountability on those who allegedly help to facilitate tax evasion.  Many banks have also been targeted by investigators, and many financial institutions from across the globe have participated in the Swiss Bank Program which the IRS has created. The Swiss Bank Program offers amnesty to banks that pay fines and cooperate with taxing authorities by providing information on consumer accounts.

Individual accountholders may find their information falling into the hands of taxing authorities because of leaks like the Panama Papers or because of cooperation by financial institutions.  Consulting with Kevin Thorn, a DC criminal tax lawyer, is advisable before you come under investigation so you can take advantage of any options available to avoid criminal prosecution.


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"Mr. Thorn and the attorneys at Thorn Law Group were so knowledgeable about the IRS Voluntary Disclosure Program and about the way the IRS Criminal Investigation Division works. Mr. Thorn helped put my mind at ease and walked me through the whole Voluntary Disclosure process. With the help of Thorn Law Group, and Mr. Thorn specifically, we were able to get back into compliance and were able to avoid criminal prosecution."