Panama Papers law firm Colombia representative arrested in massive tax evasion scheme
By Kenneth Rijock
BOGOTA, Colombia — The Colombian representative of the Panama Papers law firm of Mossack & Fonseca, Juan Esteban Arellano Rumazo, has reportedly been arrested, together with a number of prominent Colombian businessmen, and charged with money laundering, fraud, and illicit enrichment, in a massive tax evasion scheme orchestrated by Mossack Fonseca’s Colombia office, in coordination with its Panama headquarters.
The law firm set up an elaborate scheme, with lawyers, accountants and tax auditors, using front companies in Panama, Costa Rica, Spain and England, which sent bogus invoices to Colombian companies for non-existent services.
According to the attorney general of Colombia, a bank in the Bahamas was involved. Documents were falsified by individuals at the companies involved in the fraud. Accountant and auditors were employed to manipulate income statements, and evade taxes, all through Mossack’s scheme; the law firm reportedly received a fee of four p[ercent to conduct the criminal enterprise.
It is not known whether partners, Jurgen Mossack, and Ramón Fonseca, will be charged in Colombia with their participation in this tax evasion and money laundering scheme, but their attorney’s arguments that the law firm merely opened corporations for foreign clients and did nothing more have now been seen as outright misrepresentations of fact. The Mossack firm is said to have run a racketeering operation and a continuing criminal enterprise, and was not a legitimate law firm.
Kenneth Rijock is a banking lawyer turned-career money launderer (10 years), turned-compliance officer specialising in enhanced due diligence, and a financial crime consultant who publishes a Financial Crime Blog. The Laundry Man, his autobiography, was published in the UK on 5 July 2012.
Photo: Jurgen Mossack (L) and Ramón Fonseca