AN INDIAN link has emerged between the two explosive data leaks in two years — Panama Papers (2016) and Paradise Papers (2017) — that lifted the veil on the opaque world of offshore firms in tax havens.
New records investigated by The Indian Express show that the Khemka family, which had set up over hundred offshore entities incorporated by Bahamas law firm Appleby in the Paradise Papers revelations had similar ties to Panama law firm Mossack Fonseca.
Documents from April 2016 to December 2017 show that Mossack Fonseca acted as the registered agent for Willsun Investments Company, an offshore entity set up by the Khemkas in Jersey.
They show that employees of Mossack Fonseca asked the company to adhere to due diligence norms as recently as October 2017, more than a year after the Panama Papers leak. They also traced a link between Shiv Vikram Khemka, a son of SUN group patriarch Nand Lal Khemka, and a Russian helicopter manufacturer that was placed on a sanctions list by the US in 2015.
On November 7, 2017, The Indian Express reported that Nand Lal Khemka, Shiv Vikram Khemka and his brother Uday Harsh Khemka were jointly or individually linked to over 100 offshore companies incorporated by Appleby, mostly in the British Virgin Islands and Jersey. They had the largest number of offshore entities in Appleby’s records, and the second largest overall.
New data accessed by The Indian Express shows that while Appleby was the intermediary company and secretary of Willsun, which was incorporated in 2005, Mossack Fonseca subsidiary Estera Trust (Jersey) Ltd was the registered agent.
An internal communication of August 31, 2017, stated that the company was set up to manage commercial property in London and that it was being managed and controlled by directors in Jersey.
Emails among Mossack Fonseca employees from October 9-27, 2017, reveal that the three members of the Khemka family are listed as PEPs (Politically Exposed Persons) because Nand Lal has been the Consul General for Jamaica and Iceland in India, and Shiv Vikram Khemka a board member of Vertolety Rossii AO, the Russian company.
An email on October 27, 2017, points out that Vertolety Rossii is a State Owner Enterprise (SOE) sanctioned by the OFAC (Office of Foreign Assets Control) of the US Treasury Department in its 2015 list.
Other emails show that the status of Willsun had been raised to “high risk” since the Khemkas were on the PEP list.
Records show that the Khemka family claimed that their “source of income” was commissions earned on trade activities mainly between Russia and India; return and capital growth of global investments in property, public equity, private equity, mutual fund and other sectors; and, investments in Russia primarily in the confectionery, dry cereal and brewing sectors.
The family has also listed inheritance through family businesses in the Indian sub-continent and profits made through continuation, growth and diversification of these businesses as among their sources of income.
The new records include details of a meeting of Willsun shareholders in New Delhi on May 26, 2017, which was chaired by Uday Harsh with the minutes signed by Shiv Vikram. The meeting, records show, endorsed a change of foreign directors.
The fresh leak shows that details submitted by Shiv Vikram and Uday Harsh to Mossack Fonseca for Willsun included Indian passport and PAN numbers, apart from proof of residence in Switzerland.
They include several emails which state that if due diligence requirements were not met, Mossack Fonseca would resign as the registered agent.
When contacted by The Indian Express, a spokesperson for the SUN group stated: “The SUN group is a private investment group which was founded by NRIs over 30 years ago and has been working across the globe since then. We follow and comply with all related laws in areas and countries where the group’s operations exist.”