Top Liberal Party fundraiser, 3 former PMs named in Paradise Papers

When you would legitimately need to have an offshore account Many times when we hear "offshore account" we think "tax evasion," but there are perfectly legitimate reasons for having an offshore account that have nothing to do with evading tax. BNN looks to Kim Moody, director of Canadian Tax Advisory at Moodys Gartner Tax Law LLP, for insight.

Liberal Party fundraiser Stephen R. Bronfman, Queen Elizabeth II, and several of U.S. President Donald Trump’s allies are said to be among 120 international figures and companies who have been using offshore tax havens, an international team of journalists has learned.

The financial dealings are documented in the so-called “Paradise Papers,” a trove of 13.4 million documents originally leaked to the German paper Süddeutsche Zeitung from an offshore law firm called Appleby.

The documents have been the subject of a massive investigation by the International Consortium of Investigative Journalists (ICIJ) – the same group that dropped the Panama Papers bombshell in April of 2016.

The Paradise Papers contain nearly 7 million financial documents and emails revealing the offshore interests and activities of “more than 120 politicians and world leaders, including Queen Elizabeth II,” according to the ICIJ. The group says details about the Queen indicate that her “private estate indirectly invested in a rent-to-own loan company accused of predatory tactics.”

Former Canadian prime ministers Jean Chretien, Paul Martin and Brian Mulroney are among the most high-profile individuals named in the document release, which has more than 3,000 references to Canadians.

Chretien is said to have received shares in a Madagascar-based oil and gas venture in July, 2007 in exchange for consulting work. The Appleby files contain no evidence that Chretien exercised the options.

Chretien said in an interview that he was not aware of the shares in Madagascar Oil Ltd.

Martin was named due to his former ownership stake in CSL Group Inc., an international shipping firm now run by his sons and said to be one of Appleby's “biggest clients,” according to a leaked document.

A spokesperson for Martin told the ICIJ that the former prime minister “has not been involved in CSL in over a quarter century and is not in a position to comment on its operations.”

Mulroney is listed in the Appleby files as a director of Said Holdings Ltd. between 2004 and 2009. The Bermuda-based company is controlled by Syrian-Saudi businessman Wafic Said, who is said to have had a key role in the multi-billion dollar al-Yamamah “oil-for-arms” deal between the U.K. and Saudi Arabia.

A response from Said confirmed Mulroney’s involvement in his family’s investment company, and referred to his “valuable contributions.”

The federal Liberal Party’s chief fundraiser, Stephen R. Bronfman, was also named. The documents suggest Bronfman’s private investment company, Claridge, moved millions to offshore entities owned by his godfather, Leo Kolber, another former Liberal fundraiser.

Bronfman is also the revenue chair on the Liberal Party's board of directors.

A lawyer for the Bronfman and Kolber families told the ICIJ that “none of the transactions or entities at issues were effected or established to evade or even avoid taxation,” and that they “were always in full conformity with all applicable laws and requirements.”

Any “suggestion of false documentation, fraud, ‘disguised’ conduct, tax evasion or similar conduct is false, and a distortion of the facts,” he said.

A spokesman for Trudeau declined to comment to the ICIJ.

Before the ICIJ report was released, the Canada Revenue Agency issued a statement on Friday outlining its efforts to “combat those hiding their assets offshore.”

The agency said it has invested $1 billion to ensure the integrity of Canada’s tax system, and noted that it currently has more than 990 audits and more than 42 criminal investigations related to offshore underway.

Neither the CRA nor any court has determined the Canadians did anything wrong.

ICIJ reporter Will Fitzgibbon said the investigation peels back the curtain on a complex web of financial dealings well-hidden from public eyes for over five decades.

“While there is not necessarily evidence of smoking-gun wrong doing . . . the problem with these secretive offshore entities is that money can be moved in ways so that the tax man, be it in Canada or elsewhere, might not be able to follow,” he told CTV News Channel on Sunday from Washington.

At least 13 allies of U.S. President Donald Trump are also included in the Paradise Papers, the ICIJ says. The ICIJ mentioned Trump’s commerce secretary, Wilbur Ross, by name in their release on Sunday, saying that he holds “interests in a shipping company that makes millions from an energy firm whose owners include Russian President Vladimir Putin’s son-in-law and a sanctioned Russian tycoon.”

The financial documents go back up to 50 years. However, the Ross documents are quite recent, according to Fitzgibbon.

“There’s a real question here from the Paradise Papers as to how and why a key member of the U.S. administration is involved in a company doing deals with Russian entities that many experts say is extremely close to President Putin,” Fitzgibbon said. He added that Ross’ representatives say the deal with the Russian shipping firm was signed before Ross took a post in Trump’s cabinet.

Further details about the figures implicated in the Paradise Papers are expected to come throughout the week.

With files from The Canadian Press