The offshore financial affairs of hundreds of politicians, multinationals, celebrities and high-net-worth individuals, some of them household names, have been revealed.
The papers also throw light on the legal firms, financial institutions and accountants working in the sector and on the jurisdictions that adopt offshore tax rules to attract money.
Uganda’s Foreign Affairs Minister, Sam Kahamba Kutesa has not been spared.
According to the papers, Kutesa created the Obuyonza Discretionary Trust in the Seychelles in 2012. The trust held shares in the Seychelles company Katonga Investments Ltd. He created the trust, watched over its administration and was one of its beneficiaries.
Kutesa’s daughter, Ishta, also is listed as a beneficial owner as well as a future recipient of money from the trust. An internal Appleby document from 2015 reported that the company’s intended activities were “consultancy, investments, trading and airport services in Uganda.” The money for Katonga was to come from Enhas Uganda Ltd., another Kutesa entity, Appleby’s notes state.
Kutesa has owned Enhas, a ground-handling service at Uganda’s Entebbe Airport, since the 1990s.
In 1998, a Ugandan parliamentary committee named Kutesa and another co-owner in a report criticizing the privatization that helped create Enhas and led to its lucrative airport contract. The report concluded that the privatization had been “manipulated and taken advantage of by a few politically powerful people who sacrifice the people’s interests.”
As part of a periodic review in 2015, Appleby labeled Kutesa’s companies a “high risk,” given his political role and media reports of alleged corruption and bribery involving Kutesa. Kutesa told Appleby that the purpose of the trust was to separate his government income “from his personal assets and belongings.” In 2015, however, Appleby noted that the companies connected to the trust were dormant and that “it seems that nothing such is being done.”
RESPONSE
Kutesa confirmed to ICIJ’s media partner in Uganda, The Daily Monitor, that he established the companies, but “I have never done anything with it at all. I told Appleby to close it many years ago.” He said he had registered a company in Uganda and is paying taxes. “I thought you could avoid, not evade, taxes but I found it was not practical, and unnecessary,” Kutesa told the Daily Monitor. “I don’t have anything to hide.”
The Paradise Papers are a huge leak of financial documents that throw light on the top end of the world of offshore finance.
A number of stories are appearing in a week-long expose of how politicians, multinationals, celebrities and high-net-worth individuals use complex structures to protect their cash from higher taxes.
As with last year’s Panama Papers leak, the documents were obtained by the German newspaper Süddeutsche Zeitung, which called in the International Consortium of Investigative Journalists (ICIJ) to oversee the investigation. BBC Panorama and the Guardian are among the nearly 100 media groups investigating the papers.
The Paradise Papers name was chosen because of the idyllic profiles of many of the offshore jurisdictions whose workings are unveiled, including Bermuda, the HQ of the main company involved, Appleby. It also dovetails nicely with the French term for a tax haven – paradis fiscal. Then again, the Isle of Man plays a big part.
AGENCIES
