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Tracking Panama cash trail: What India Wanted, What It Got — And Didn’t

India sent notices to authorities in tax havens, including the BVI and the Bahamas, seeking details of beneficial ownership and finances of a number of offshore companies managed by Mossack Fonseca.

Written by P Vaidyanathan Iyer |
April 5, 2016 2:15:09 am
Panama Papers, Mossack Fonseca, Panama papers india, indian express, panama papers india list, Kansu Corporation, Claire Consultants, Zerpin Holdings, Bragmar Equities, STI United Corporation, Mossack Fonseca , panama leaks, Mossack Fonseca shell companies, panama list, Mossack Fonseca india, Mossack Fonseca india clients, indian express panama papers, latest news The Mossack Fonseca office in Panama City. The law firm is one of the world’s top creators of shell companies.

India sent notices to authorities in tax havens, including the BVI and the Bahamas, seeking details of beneficial ownership and finances of a number of offshore companies managed by Mossack Fonseca. They include Kansu Corporation, Claire Consultants, Zerpin Holdings, Bragmar Equities and STI United Corporation.

Records show how these requests hit a roadblock

KANSU CORPORATION
* India’s request to Bahamas: January 22, 2015
* Bahamas writes to MF: June 9, 2015
* Time given by Bahamas to MF: 28 days
* Period of interest: 1995 to 2011

Read | Explained: What Do The Panama Papers Reveal

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Information sought: Incorporation, shareholder, management, bank accounts, statements, payments to shareholders/ directors, ledger accounts of Dilip J Thakkar, Indira D Thakkar and the Chhaganlal Suchak Family Trust in the books of Kansu Corporation Limited.

Watch | Panama Papers: Big Names In The Indian List

India sought information about Bahamas-registered Kansu Corporation in January 2015. But the Canadian tax authorities had already approached the tax haven in 2012 for information pertaining to a loan extended to the offshore entity by Shirish Suchak and Elkay Finance Quebec Inc. MF records show that it was more concerned about the Canadian request.

Read | Panama Papers India, Part 2: Politician, industrialist, jeweller

In May 2012, Mossack Fonseca informed the finance ministry in the Bahamas that the company was struck off the registry since January 2012. But MF soon realised that a loan of Canadian $7 million is owed to Kansu, indicating that the entity was still active. “This operation perhaps is connected to this request from the Canadian tax authorities because Elkay Finance and Shirish Suchak are the persons investigated according to the notice,” an MF executive from MF’s Panama office informs her colleague in The Bahamas.

The India connection is Dilip Thakkar, a Mumbai-based chartered accountant, who was first appointed as a director in 1995. His wife, Indira Dilip Thakkar, was also a director in Kansu from April 2001 to January 2009.

CLAIR CONSULTANTS LTD
* India’s request to BVI: April 25, 2014
* BVI notice to MF: June 6, 2014
* Time given by BVI to MF: 10 days
* Period of interest: 2002-2012

Information sought: Shareholder details, shares allotted, amount paid, due diligence documents for beneficial owners, directors’ details including India connection, P&L and Balance Sheet statements, bank accounts in HSBC (Geneva), Deutsche Bank AG (Singapore) and Deutsche Bank Trust Company Ltd (New York).

Watch | Explained: What Do The Panama Papers Reveal

After India’s request was conveyed by BVI tax authorities, MF approached LOPAG, which had provided directors to Clair Consultants. On May 9, 2014, LOPAG told MF through a letter that Clair has been struck off the registry. Its directors included Louis Oehri, the founder of LOPAG. It also said that “the beneficial owner of Clair Consultants Limited was Mr Venkata Rao Madugula, date of birth: 31.12.1939, domiciled in 110016, New Delhi, India.”

Records available in India’s Ministry of Corporate Affairs reveal that Madugula was the managing director of a company called Transcom Services India Private Ltd, located at Patparganj Industrial Estate. This company is also dormant. The other director in the company was Ranjit Bahadur Singh.

Indians in Panama Papers list: Amitabh Bachchan, Aishwarya Rai, KP Singh, Iqbal Mirchi, Adani elder brother

MF further wrote to the BVI’s International Tax Authority that Clair did hold assets before it became dormant and was struck off in April 2010. Madugula’s address was provided as F58, Queen Park (Main), New Delhi 110016. The accounting records, including financial statements of the company, were kept at Poststrasse 3, LI-9491, Liechtenstein. It held a bank deposit with DB Singapore.

More correspondence between MF’s internal departments and LOPAG suggests that India sought further details, but LOPAG continued to stall, claiming that Liechtenstein’s regulator had told the firm that it need not share these details with the BVI.

STI UNITED CORPORATION

India sent a request to BVI authorities on June 13, 2014, seeking details of shareholding, ownership and accounts of STI United Corporation. After the BVI authorities passed on the request, MF’s compliance department said that while a Russian national Ola Mirimskaya was the beneficial owner of STI United Corporation, one of the directors of the company was Sehrawat Narender Singh, an Indian, with a New Delhi address (Ms Type 2/1, Atul Grove Road, Janpath, Connaught Place, New Delhi).

Read: Panama Papers: Trailing 6 firms, Delhi hit Mossack Fonseca wall

Sehrawat was appointed as a director in the company on December 15, 2004. While his occupation is listed as a businessman, he is also the General Attorney for another company Amos Properties Ltd, also registered with MF.

Santa Barbara Foundation was listed as one of the shareholders of STI. On February 19, 2013, Sehrawat was removed from the board of directors of STI based on a written resolution by the Foundation Council of Santa Barbara Foundation, and signed by Mirimskaya, the sole director. Mirimskaya resigned as a director on October 1, 2014. Oliinyk Olga, an Ukrainian national, replaced her.

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On June 19, 2014, these details were passed on to BVI authorities by Eyra Perdomo, managing director, MF (BVI). Her affidavit stated that STI Corporation held shares in other companies as an investor to hedge funds in the Bahamas. However, MF stated that it was not in possession of financial statements and banking records of the company, which were in Moscow.

MF does not provide any details of the beneficial ownership of the company. While Santa Barbara Foundation is a shareholder, the charter of the Foundation does not reveal any ownership details. It states that the foundation’s initial capital will be $10,000. Further, it states that the Foundation’s council is not required to submit annual accounts of its administration.

***

BRAGMAR EQUITIES

On October 28, 2013, BVI sent a notice to MF, giving it ten days to seek information on the register of directors, register of shareholders, including the allocation of capital, and details of bank accounts such as account number, account name, deposits, withdrawals and statements of Bragmar Equities Ltd from 1995 to 2012.

Read | Panama Papers: Inside the offshore factory of Mossack Secret Fonseca

Authorities warned that failure to produce the information could attract a fine of up to $100,000 or imprisonment for a term not exceeding five years, or both. MF responded that the directors and shareholders of the company are listed as Integrated International Services Ltd, Nerine Chambers, PO Box, Road Town, Tortola, BVI. It turned out that this company was only an intermediary and the probe hit a dead end.

ZERPIN HOLDINGS

Following a notice sent by BVI authorities to MF on May 2, 2014, seeking information on Zerpin Holdings’ ultimate beneficial ownership, financial statements, business activities, dividend paid and funds raised, from 2011 to 2012, MF provided information in parts.

Read | Tracking Panama cash trail: How Mossack Fonseca stonewalled Delhi

It stated that the ultimate beneficial owner was Kevin Ernest Isherwood and listed his address as 14 Hackwood St, Robertswood, East Sussex. It provided other details such as address where accounting records are kept, name of the director (Lawrence Pountney Ltd) and date of registration (July 23, 2008). But crucially, it doesn’t provide financial statements.

MF records show that its compliance department acknowledged that this information would not be of any use to authorities. “From my own Google search on the director and shareholder, it appears he is acting solely as a nominee director. He is a director for a number of companies in the UK, and perhaps, elsewhere,” Daphne Durand, supervisor, legal department, MF & Co. (BVI), tells Liza Aizprua, production lawyer, at the MF headquarters in Panama.

Full Coverage: Panama Papers

Durand writes: “If it has been confirmed that Kevin Ernest Isherwood is in fact the beneficial owner, please request proof of beneficial ownership, as this is the only means of us confirming that fact. Otherwise, we will not be in a position to make any such confirmation to the Tax Authority.”

An Investigation by The Indian Express with International Consortium of Investigative Journalists & Suddeutsche Zeitung, Munich.

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