A huge data leak of confidential documents from a Panamanian law firm has revealed widespread tax avoidance by influential individuals keen on hiding their wealth. Yle reports that the leak has also implicated a large number of Finns - and Nordea Bank, the leading Nordic lender, which also has operations in Finland.
Hundreds of Finns are included in the list, which ranges from entrepreneurs, investors and athletes to convicted felons. Some of their names are to be revealed by Yle TV1's investigative programme MOT next Monday, 11 April. While offshore arrangements are not necessarily illegal, failure to report foreign holdings to tax authorities is.
Already some names with links to Finland have leaked out, including Russian business moguls Arkady and Boris Rotenberg and Gennady Timchenko who own – or have owned – sports, hotel and other interests in Finland.
The data was originally leaked to the German newspaper Süddeutsche Zeitung. It involves 11 million documents acquired from the world's fourth-largest offshore law firm, the Panama-based Mossack Fonseca.
The leak has facilitated a global wave of reporting on the issue, which began Sunday, and involves what is likely the largest data breach to date. So far it has yielded information about 200,000 dummy companies set up in tax havens such as Panama and the Cayman Islands.
Nordea "does not condone tax evasion"
According to data uncovered by Yle, between 2004 and 2014, Nordea Bank's Luxembourg unit set up nearly 400 offshore companies for its customers in Panama and the British Virgin Islands.
The files indicate that employees of the Panamanian law firm were named as company directors, ensuring that Nordea customer names would not be publicly linked with the sham companies.
Ari Kaperi, Nordea's Country Senior Executive in Finland, tells Yle that Nordea does not condone tax evasion nor does it assist customers in planning it.
He says Nordea will comb through all of the corporate arrangements offered to clients by the Luxembourg-based Nordea International Private Banking. Kaperi says that the Luxembourg office serves international customers and that it should not be handling those domiciled in Finland. However he declined to go into detail.
Nordea admits that practices may have been more lax in the past, it noting that the practice of helping customers avoid tax exposure had been quite common in the sector until recently.
"We defined in late 2009...we said we will not accept our bank to be used as a platform for tax evasion," says Thorben Sander, Head of Private Banking, Nordea Luxembourg. "We want to help our clients to pay the taxes that they should. Prior to 2009, that was not how we defined our role."
Arhinmäki: Ownership should be transparent
Finnish government ministers, who were sequestered in strategy meetings all Monday, did not immediately comment on the revelations.
Meanwhile opposition politicians such as Left Alliance chair Paavo Arhinmäki did. He told Yle that more must be done to prevent tax havens.
"We should have a financial market tax, every company should be obliged to announce its profits in the countries where it earns them, and what one owns should be completely open information," Arhinmäki told Yle's Swedish-language news.
Stubb "surprised" by Nordea involvement
Finance Minister Alexander Stubb, who also leads the pro-business National Coalition Party, commented to Yle on Monday by email, citing a busy schedule ahead of budget talks on Tuesday.
He said he was surprised that a bank operating in Finland was centrally involved.
"I strongly condemn tax evasion," said Stubb. "Taxes on income that falls under the scope of Finnish taxation must be paid to Finland. Now it is up to the police and other authorities to evaluate whether illegalities have taken place involving Finns. Fortunately we have an agreement on exchange of information with Panama, so our tax administration can request the information that they need. I also believe that this revelation will give added impetus to the international cooperation against tax evasion."
