Feds indict 4 men in Panama Papers investigation

The journalists who broke 'Panama Papers'

Panama Papers investigation: four men criminally charged in US

US authorities unsealed charges against four people in connection with offshore accounts opened with the help of Panamanian law firm Mossack Fonseca & Co., in the first USA criminal prosecution to emerge from the so-called Panama Papers leak.

Gaffey was arrested in MA earlier Tuesday.

The most serious charges in the case, which include wire fraud and money laundering conspiracy, carry a maximum sentence of 20 years in prison.

The prosecutors said Mossack Fonseca perpetrated a "decades-long criminal scheme", which was first exposed in a series of articles since 2015 by the Guardian and dozens of media partners around the world.

The 10 top local news stories from metro Boston and around New England delivered daily.

The 11-count indictment unsealed in Manhattan stems from what prosecutors described as an "intercontinental money laundering scheme" involving a global law firm based in Panama. The charges were revealed in an 11-count federal indictment unsealed Tuesday in NY.

The repercussions of the leaks were far-ranging, prompting the resignation of the prime minister of Iceland and bringing scrutiny to the leaders of Argentina and Ukraine, Chinese politicians and Russian President Vladimir Putin, among others.

Two Germans, one American and one Panamanian citizen were charged with conspiracy and other counts. All but Owens have been arrested. But Owens, 50, remains at large, USA authorities said.

Jeffrey Newman, a lawyer for Von Der Goltz, called the indictment "a desperate attempt to salvage an American case out of the Panama Papers".

Investigators said Owens and Brauer had for years created and managed sham foundations, opaque offshore trusts and undeclared bank accounts to allow American clients of Mossack Fonseca to hide their income from USA tax authorities.

Owens and Brauer are accused of establishing and managing "opaque offshore trusts and undeclared bank accounts" on behalf of American taxpayer clients of Mossack Fonseca, the U.S. Attorney's Office for the Southern District of NY said in announcing the charges.

Gaffey is accused of assisting Von Der Goltz's scheme and advising another American taxpayer, who is identified in Tuesday's filings only as "Client 1".

The trio also allegedly lied that Von Der Goltz's elderly mother owned the fake accounts, because she was a Guatemalan citizen and resident and thus not a United States taxpayer, like Von Der Goltz.

Mossack Fonseca was the Panama-based law firm subjected to a massive leak of papers in 2016 that lifted the lid on hidden tax activities of the wealthy.

Gaffey also worked with Owens to help another, unnamed client deceive the IRS by establishing offshore accounts to hold about $4 million.

According to the indictment, Gaffey and Owens gave that client advice on how to covertly repatriate about $3 million of the client's offshore money to the U.S. falsely saying on their tax return that the money represented proceeds from a sale. The data leak included copies of about 200 American passports, and some 3,500 shareholders in the offshore companies listed addresses in the US - a small fraction of the more than 250,000 companies Mossack Fonseca set up for clients in four decades of business.

Joachim von der Goltz, who is accused of hiding his ownership of shell companies he used to secret away tens of millions of dollars from US tax authorities, was arrested in London on December 3.

Latest News