Department of Justice Opens Investigation into Tax Avoidance Exposed by Panama Papers Leak

According to the Guardian, the Department of Justice is investigating the global tax avoidance scheme revealed by the publication of the Panama Papers.

In a letter to the International Consortium of Investigative Journalists, Preet Bharara, the U.S. Attorney for the Southern District of New York, wrote that his office had “opened a criminal investigation regarding matters to which the Panama Papers are relevant.” ICIJ obtained the 11.5 million files from the Panamanian law firm Mossack Fonseca, and shared them with a variety of news outlets.

More than 200 U.S. citizens are named in the papers, some of whom Bharara—whose jurisdiction includes Manhattan, and who has made a name for himself aggressively investigating both financial and political corruption—is already prosecuting. From the Guardian:

Among them is Wall Street financier Benjamin Wey, who has been charged with securities fraud, wire fraud, conspiracy and money laundering for using family members to help him amass ownership of large blocks of stock in companies through so-called “reverse merger” transactions between Chinese companies and US shell companies. He made tens of millions of dollars of illegal profit by manipulating the companies’ stock prices, according to the indictment.

The Panama Papers leak shows that Mossack Fonseca helped set up the offshore companies used in the stock manipulation.

“Ben Wey fashioned himself a master of industry, but as alleged, he was merely a master of manipulation,” Bharara said when he announced the indictment against Wey in September. Wey, the chief executive of New York Global Group, denies the charge.

“The Office would greatly appreciate the opportunity to speak as soon as possible with any ICIJ employee or representative involved in the Panama Papers Project in order to discuss this matter further,” Bharara’s letter reads.