Will Hillary's Campaign Survive The Mossack Fonseca Panama Papers Scandal?

The very first time I heard about the Mossack Fonseca scandal in Panama, my immediate reaction was, that there with this many elite criminals there are bound to be plenty of Clinton connections. A few days later, we did a post about the contrast between her support for the Panama "free" trade deal which led to the scandal and Bernie's prescient and well documented opposition based on the money laundering Panama is so infamous for. Then came the revelations about the involvement of the crooked lobbying firm closest to the Clintons, the Podesta Group, the head of which, John Podesta, is her campaign chairman. I didn't find them persuasive enough to post.

And then, yesterday, the McClatchy papers ran with an article that speaks of multiple Clinton connections to the scandal. Let's hope this all comes out now and she's either exonerated from any wrong-doing or from another excruciatingly bad example of her much vaunted "judgement" or that it's bad enough to drive her out of politics before the Republicans use it to beat her in a general election and ruin the Democratic Party. So far, I'm not seeing the smoking gun that will get her to withdraw from the race, not that that will stop the Republicans. Just wait 'til Morning Joe starts in on this tomorrow! And, eventually, someone in bound to tell Trump. Hill and Bill, McClatchy asserts "have multiple connections with people who have used the besieged law firm Mossack Fonseca to establish offshore entities."

Among them are Gabrielle Fialkoff, finance director for Hillary Clinton’s first campaign for the U.S. Senate; Frank Giustra, a Canadian mining magnate who has traveled the globe with Bill Clinton; the Chagoury family, which pledged $1 billion in projects to the Clinton Global Initiative; and Chinese billionaire Ng Lap Seng, who was at the center of a Democratic fund-raising scandal when Bill Clinton was president. Also using the Panamanian law firm was the company founded by the late billionaire investor Marc Rich, an international fugitive when Bill Clinton pardoned him in the final hours of his presidency.


...The Clintons themselves do not appear to be in Mossack Fonseca’s database, nor does it appear that their daughter, Chelsea, or her husband, Marc Mezvinsky, who co-founded a hedge fund, are listed. But Bill and Hillary Clinton’s connections to people who have used offshores is fuel for her Democratic rival, Bernie Sanders.

Clinton has struggled throughout her campaign to show that she can relate to working Americans, while Sanders has cast her as a wealthy out-of-touch Washington insider who has accepted hefty paychecks for speeches and received millions of dollars in campaign contributions from those tied to big businesses. Her connection to the Panama Papers, even if indirect, could magnify that perception.


...Sanders said Clinton’s support of a free-trade agreement between the U.S. and Panama-- one that he claims has allowed the wealthy to avoid paying taxes-- should disqualify her from being the Democratic nominee for president.

“I don’t think you are qualified if you supported the Panama free trade agreement, something I very strongly opposed, which has made it easier for wealthy people and corporations all over the world to avoid paying taxes owed to their countries,” Sanders said recently... “I wish I had been proven wrong about this, but it has now come to light that the extent of Panama’s tax avoidance scams is even worse than I had feared,” he said in a statement earlier this month.

The 5 most corrupt in Congress-- ever

Yes, she's even worse than horrifying sleaze-bags Mitch McConnell and Paul Ryan when it comes to the clearest source of corruption anywhere in government, the lobbyists, who just happen to be the mainstay of her campaign and her career. Oh, and speaking of Paul Ryan...

Ever Watch A British Parliamentary Debate? The Beast Of Bolsover vs Dodgy Dave

When I was spending a lot of time in London on business for a few years, a friend of a friend was a Member of Parliament-- a gay Tory-- and he offered to take me to lunch in the Members dining room one day with the option of sitting in the visitors' gallery and hearing a debate. I gladly accepted .The day we picked just happened to turn out to be the day Margaret Thatcher decided to go join George H.W. Bush and go to war against Iraq. It wasn't a very lively debate and there was a sense of unrealness about what was-- in retrospect at least, being launched. One of the Members opposing Thatcher was Dennis Skinner., not a favorite of my host it turns out. Lunch, afterwards, though was very nice. Skinner, I was told, never eats in the Members dining room.

This week's debate over the Panama Papers was somewhat more exciting. That's when the same Dennis Skinner, a former coal miner and a Labour MP since 1970 (from Bolster in Derbyshire)-- affectionately known to his colleagues and constituents as "The Beast of Bolsover"-- caused quite a stir and got himself ejected from the House for the day.

Although most Americans who know of Skinner at all, know him as one of the PMs who was behind Jeremy Corbyn when he was overthrowing the New Labour dominance of the party, Brits still remember that Skinner, an outspoken anti-monarchist, had used the floor of Parliament to expose Thatcher for bribing judges in 1984 and, in 2005, referring to the Conservatives' economic record under Thatcher as a time when "the only thing that was growing then were the lines of coke in front of Boy George and the rest of the Tories." He was ejected from Parliament for those statements-- and quite a few others.

When Paul Ryan was dividing up Americans as "makers" & "takers," David Cameron was using the same kind of right-wing divisiveness to categorize Brits as "strivers" & "scroungers." Monday, Skinner, during a debate on the Panama Papers and the role of the Cameron family in the corruption, called the Prime Minister, "Dodgy Dave," which didn't go over well among the Conservatives, where the epithet struck a raw nerve. Under unparliamentary language rules, no MP is allowed to accuse another member of being dishonorable and "dodgy" would imply Cameron is a crook who was avoiding paying taxes by stashing wealth overseas. Cameron's defenders are also using name-calling to cloud the debate. Yesterday, Sir Alan Duncan, the Conservative MP for Rutland and Melton called working people who criticize Cameron for being a crook jealous "low achievers." He sounds very much like a Republican:

Paul and Dodgy Dave

"Shouldn't the Prime Minister's critics really just snap out of the synthetic indignation and admit that their real point is that they hate anyone who has got a hint of wealth in them? May I support the Prime Minister in fending off those who are attacking him, particularly in thinking of this place, because if he doesn't, we risk seeing a House of Commons which is stuffed full of low-achievers who hate enterprise, hate people who look after their own family and know absolutely nothing about the outside world."

He wasn't ejected from the Chamber but the debate over the Panama Papers is heating up worldwide-- and just as the U.S. confronts the latest slap on the wrist towards the bankster criminals at Goldman Sachs. No one gets blamed and no one is accused on anything. It's as though the entity "Goldman Sachs" did something complicated-- but without motivation-- illegal and will be asked to pay a fine, though not even close to the $5.06 billion being deceptively ballyhooed by the government in the media. The firm-- not individuals, apparently-- created and sold packages of shoddy mortgages to investors, one of the primary causes leading up to the near collapse of the world economy and siphoning billions of dollars from Americans' savings. The Washington Post reported that "advocacy groups quickly pounced on the deal as too lenient, noting that the $5 billion settlement is dwarfed by Goldman Sach’s recent profits. Also, they note, Goldman Sachs will be be able to deduct some of the cost of the settlement from its taxes. 'That is not justice,' said Dennis Kelleher, president and chief executive of Better Markets. 'Every single individual at Goldman who received a bonus from this illegal conduct not only keeps the entire bonus, but suffers no penalty at all.'" I'm sure that will make Obama, Schumer, and Clinton smile with disdain.

Speaking at a rally in Albany, Bernie told supporters that what was being discussed was "fraud" by Goldman Sachs and the inequity-- economic and judicial-- created by a rigged economy. "This is the system we are living in and this is the system we have to change. Goldman Sachs is one of the major financial institutions in our country... What they have just acknowledged to the whole world is that their system... is based on fraud." Perhaps this would be a good time for Clinton to release the transcripts of the speeches she gave to Goldman Sachs executives, speeches that gave the company legalistic cover to massively bribe her and her equally corrupt husband. Anyway, back to Dodgy Dave and his own embarrassing corruption exposure.

David Cameron has finally admitted he benefited from a Panama-based offshore trust set up by his late father.

After three days of stalling and four partial statements issued by Downing Street he confessed that he owned shares in the tax haven fund, which he sold for £31,500 just before becoming prime minister in 2010.

In a specially arranged interview with ITV News’ Robert Peston he confirmed a direct link to his father’s UK-tax avoiding fund, details of which were exposed in the Panama Papers revelations in the Guardian this week.

Admitting it had been “a difficult few days”, the prime minister said he held the shares together with his wife, Samantha, from 1997 and during his time as leader of the opposition. They were sold in January 2010 for a profit of £19,000.

He paid income tax on the dividends but there was no capital gains tax payable and he said he sold up before entering Downing Street “because I didn’t want anyone to say you have other agendas or vested interests.”

But the interview appeared unlikely to end scrutiny of Cameron’s tax affairs.

The Labour MP John Mann, a member of the Treasury select committee, said the prime minister should resign, claiming that Cameron had “covered up and misled.”

Cameron also admitted he did not know whether the £300,000 he inherited from his father had benefited from tax haven status due to part of his estate being based in a unit trust in Jersey.

“I obviously can’t point to the source of every bit of money and dad’s not around for me to ask the questions now,” Cameron said.

It was the fifth explanation in four days from Cameron and his aides about the benefits he and his family had enjoyed from the offshore fund.

Downing Street initially insisted it was a private matter, but Cameron then said he had “no shares, no offshore trusts, no offshore funds”. His spokesman later clarified: “The prime minister, his wife and their children do not benefit from any offshore funds.”

Downing Street then said there were no offshore funds or trusts the family would benefit from in future, leaving questions about the past.

In his first interview on the topic after days of stonewalling, Cameron was questioned on whether there was a conflict of interest between his father setting up the Panama-based Blairmore Investment Trust, which did not have to pay UK tax on its profits, and his professed policy to crack down on aggressive tax avoidance.

...Richard Burgon, the shadow Treasury minister, said Cameron’s admission showed a “crisis of morals” at the heart of the Conservative government.

He said: “After four days of refusing to answer this question David Cameron has now finally been forced to admit he directly benefited from Blairmore, a company which paid no tax in 30 years. He must now further clarify whether or not he or his family were benefiting directly or indirectly in 2013 when he was lobbying to prevent EU measures to better regulate trusts as a way to clamp down on tax avoidance.

Don't say no one ever warned you. This is what happens whether you elect conservatives, whether Dodgy Dave in Britain, Paul Ryan in Wisconsin or Hillary Clinton in New York. It's in their political DNA. Wise up; we finally have real choice-- which doesn't happen all that often. After an onslaught from the establishment media, you may not think Bernie's perfect but, there's no getting around it: Hillary and everyone around her just reek of corruption. Support Bernie and the anti-corruption reformers like him who are running for Congress.

What Does Mossack Fonseca Tell You About The Competence Of Bernie And Hillary-- Or Of Tim Canova And Wasserman Schultz?

Hillary was a big booster of the catastrophic Bush-Cheney decision to invade Iraq and disrupt the stability of the Middle East. Bernie was adamantly opposed. It turned out it be the worst American foreign policy decision in at least a century. And it is far from the only example of Hillary's instinctually bad, Republican-oriented decision-making in terms of foreign policy. Take a look at the video up top that shows her shilling for the terrible Panama Free Trade Agreement, juxtaposed with Bernie carefully laying out why that agreement was a terrible idea. It was her agreement and he, wisely voted against it. The agreement, as we pointed out yesterday, led directly to the still-unfolding Mossack Fonseca scandal.

In the House, the vast majority of Democrats saw this treaty the same way Bernie did-- and voted against it. 123 Democrats voted no, but the Hillary-wing of the party voted YES-- Debbie Wasserman Schultz, Jim Himes, Terri Sewell, Kurt Schrader, Gregory Meeks, Steny Hoyer, Chris Van Hollen, Joe Crowley, Albio Sires... It passed the Senate 66-33, most of the Democrats voting against Hillary's corruption treaty with Panama. Of course, her pal Joe Lieberman was for it, as was Dianne Feinstein, Mary Landrieu, Mark Pryor and virtually all the Republicans, from Marco Rubio, Jim DeMint, Roy Blunt, Rob Portman, Miss McConnell, Mark Kirk, Chuck Grassley, John McCain, Richard Burr, Kelly Ayotte... the whole crew of conservatives who always let the lobbyists sway their votes on trade policy.

Once again, Bernie was right; and, once again, Hillary was wrong. They like painting herself as "prepared." Prepared for what? Being the best Republican president money can buy who's pretending to be a Democrat? As always, Bernie was guided by wisdom, values and principles and, as always, she was guided by corruption and expediency. Yesterday Bernie mentioned that Hillary had "opposed this trade agreement when she was running against Barack Obama for president in 2008. But when it really mattered she quickly reversed course and helped push the Panama Free Trade Agreement through Congress as Secretary of State. The results have been a disaster."

As Ryan Grim mentioned in an e-mail today, "The Bernie pile-on after his interview with the New York Daily News is something to behold. His post about it at Huff Po is worth reading. He shows that it was "the Daily News editors who are bungling the facts in an interview designed to show that Sanders doesn’t understand the fine points of policy. In questions about breaking up big banks, the powers of the Treasury Department and drone strikes, the editors were simply wrong on details... This wasn’t an interview about policy details. It was about who the media has decided is presidential and who isn’t, who is serious and who isn’t. The Daily News and much of the rest of the media don’t think Sanders is qualified to be president, and that’s the motivation for an interview meant to expose what the media have already decided is true... Candidates the media deem to be serious do not get these policy pop quizzes, because it is believed (accurately) that they can hire experienced advisers who can work out the details. But if they were pressed, there’s no doubt a studied reporter could make them look silly."

Meanwhile, Hillary's actual record is what makes her look silly and, worse, unqualified to be president-- and on on a Paul Ryan level. Progressive congressional candidates opposed to the neoliberal treaties she's been pushing for decades can use debate them with their opponents. Oh, but Panama Trade Deal backers like Kurt Schrader, Albio Sires and Debbie Wasserman Schultz refuse to debate their opponents. They're afraid that Democratic primary voters will recognize exactly what they are.

Wassermann Schultz's opponent, Tim Canova, a well-respected critic of the aspects of "free" trade that encourage job loss and degradation of American social and economic justice norms, has been holding Wasserman Schultz accountable for her corrupt perspective on deals like the one with Panama. This morning he reiterated that she "voted for the Panama Free Trade Agreement, as well as other trade deals that undermine our government capabilities to monitor international financial transactions and prevent tax evasion and violations of sanctions against Iran and other rogue states. While she was supporting this Panama agreement, I have spent my entire career as an educator, lawyer, and activist criticizing offshore tax havens and these kinds of trade and investment liberalization agreements."

Will the Hillary campaign's Podesta brothers drag her down as their connections to Panama scandal criminals come to light? Have you contributed to Bernie's campaign yet? Maybe you should give it some serious consideration-- to him and to the congressional candidates who also oppose these corrupt and dysfunctional trade agreements and are running on his platform of progressive issues. You can do so by tapping the thermometer:

Panama's Mossack Fonseca Has Certainly Become Very Famous Over The Weekend... Here's Why

I bet everyone inside Fortress Hillary in Brooklyn breathed a sign of relief when the Panama Papers of money launderers and assorted financial criminals started leaking and didn't show any Clintons, Mezvinskys or any of the other shady characters they've surrounded themselves with. I'm told, though, there's plenty more to come. The first political casualty seems to be Sigmundur David Gunnlaugsson, the right-wing prime minister of Iceland who had set up a secret company in the British Virgin Islands to shelter investments with his rich partner, Anna Sigurlaug Pálsdóttir, who he later married. He didn't disclose his investment when he ran for Parliament, even though it included shares in 3 of Iceland's failed banks. Though there is mounting pressure on him to do so, as of this writing, he hasn't resigned yet. People are running around Reykjavik chanting the old slogan from the 2008 financial collapse, "Vanhæf ríkisstjórn," roughly "unfit/unqualified Government." Do you watch The Vikings on the History Channel? You don't want to piss these people off. [UPDATE: Gunnlaugsson resigned today.]

This is what Bernie had to say during the debate on the Panama Free Trade Treaty supported by Republicans and the Republican wing of the Democratic Party. Hillary supported the treaty, of course. But read Bernie's statement carefully:

Lastly, let me say a brief word about Panama and the Panama free-trade agreement. Panama's entire economic output is only $26.7 billion a year or about two-tenths of 1 percent of the U.S. economy. Nobody can legitimately claim that approving this free-trade agreement will significantly increase American jobs.

Then why would we be considering a stand-alone free trade agreement with Panama ? It turns out that Panama is a world leader when it comes to allowing wealthy Americans and large corporations to evade U.S. taxes by stashing their cash in offshore tax havens. The Panama Free Trade Agreement will make this bad situation much worse.

Each and every year, the wealthiest people in our country and the largest corporations evade about $100 billion in U.S. taxes through abusive and illegal offshore tax havens in Panama and other countries.

According to Citizens for Tax Justice:

A tax haven... has one of three characteristics: it has no income tax or a very low rate income tax; it has bank secrecy laws; and it has a history of non-cooperation with other countries on exchanging information about tax matters. Panama has all three of those... They're probably the worst.

 This is the (very) short version of what this whole Mossack Fonseca scandal is all about. The secret files:

• Include 11.5 million records, dating back nearly 40 years-- making it the largest leak in offshore history. Contains details on more than 214,000 offshore entities connected to people in more than 200 countries and territories. Company owners in billionaires, sports stars, drug smugglers and fraudsters.

• Reveal the offshore holdings 140 politicians and public officials around the world-- including 12 current and former world leaders. Among them: the prime ministers of Iceland and Pakistan, the president of Ukraine, and the king of Saudi Arabia.

• Document some $2 billion in transactions secretly shuffled through banks and shadow companies by associates of Russian President Vladimir Putin.

• Include the names of at least 33 people and companies blacklisted by the U.S. government because of evidence that they’d been involved in wrongdoing, such as doing business with Mexican drug lords, terrorist organizations like Hezbollah or rogue nations like North Korea and Iran.

• Show how major banks have driven the creation of hard-to-trace companies in offshore havens. More than 500 banks their subsidiaries and their branches-- including HSBC, UBS and Société Générale-- created more than 15,000 offshore companies for their customers through Mossack Fonseca.

The story is humongous around the world but has been tamped down here in the U.S. So far 140 politicians and thousands and thousands of millionaires and billionaires-- from around the world-- have been exposed as tax evaders. The Russian government dismissed it as just some standard Putinphobia. He can use that same tactic Hillary uses-- how his enemies just always have it out for him, which is true, but doesn't mean he doesn't sometimes commit some crimes, like squirreling away $2 billion. Others named include relatives of Chinese leaders including President Xi Jinping, David Cameron's crooked father, Pakistani Prime Minister Nawaz Sharif, well-known criminal Petro Poroshenko, the President of Ukraine, and some nuclear bomb-building North Koreans. I think this story will have legs.

Kevin Brady (R-TX), chairman of the House Ways and Means Committee announced he plans to draft American international tax reform legislation immediately. (The horse went thataway!) The main purpose will, of course, be to lower taxes on the rich and on corporations. Matthew Yglesias did a solid explanation of what's going on with this whole mess yesterday.

Mossack Fonseca is not a household name, but the Panamanian law firm has long been well known to the global financial and political elite, and thanks to a massive 2.6 terabyte leak of its confidential papers to the International Consortium of Investigative Journalists it's about to become much better known. A huge team of hundreds of journalists is pouring over the documents they are calling the Panama Papers.

The firm's operations are diverse and international in scope, but they originate in a single specialty-- helping foreigners set up Panamanian shell companies to hold financial assets while obscuring the identities of their real owners. Since its founding in 1977, it's expanded its interests outside of Panama to include over 40 offices worldwide, helping a global client base to work with shell companies not just in Panama but also the Bahamas, the British Virgin Islands, and other notorious tax havens around the world.

The documents provide details on some shocking acts of corruption in Russia, hint at scandalous goings-on in a range of developing nations, and may prompt a political crisis in Iceland.

But they also offer the most granular look ever at a banal reality that's long been hiding in plain sight. Even as the world's wealthiest and most powerful nations have engaged in increasingly complex and intensive efforts at international cooperation to smooth the wheels of global commerce, they have willfully chosen to allow the wealthiest members of Western society to shield their financial assets from taxation (and in many cases divorce or bankruptcy settlement) by taking advantage of shell companies and tax havens.

If Panama or the Cayman Islands were acting to undermine the integrity of the global pharmaceutical patent system, the United States would stop them. But political elite of powerful western nations has not acted to stop relatively puny Caribbean nations from undermining the integrity of the global tax system-- largely because western economic elites don't want them to.

UPDATE: And, Yes, We Have An Americano

One of the first Americans identified in the rapidly unfolding Panama scandal is high-profile notorious Wall Street sleaze-bag Benjamin Wey, president of New York Global Group. You may recall that he was indicted last year on 8 counts of securities fraud, stock manipulation, money laundering, and wire fraud for his role in a fraudulent scheme to profit from undisclosed, controlling ownership interests in several companies. His wife, sister and two of his attorney's were also indicted for "the aiding and abetting of violations of the antifraud provisions and the disclosure and reporting provisions of the federal securities laws." Among the American politicians he had bribed with campaign contributions are sleazy pro-Wall Street Democrats from the corporate wing of the party: New Dems Joe Crowley and Sean Patrick Maloney and Blue Dog Steve Israel (with a $20,000 "contribution" to the DCCC on September 30, 2013). Wey has also given money to the most corrupt of the Vegas politicians, Harry Reid. The revelations will only get more interesting. This morning's Chicago Tribune:

Benjamin Wey is a U.S. citizen and president of New York Global Group. He was indicted last year, along with his Swiss banker, Seref Dogan Erbek, on securities fraud charges. Wey's alleged scheme to conceal a true ownership interest in publicly traded companies was at the heart of the charges. Wey is accused of using offshores set up with Mossack Fonseca to disguise complicated transactions between Chinese operating companies and publicly traded U.S. shell companies.

The two "are believed to have profited in the tens of millions, while victim shareholders were left holding the bill," Diego Rodriguez, an FBI official involved in the case, said in a statement at the time of indictment.

Crowley and Maloney, widely considered two of the most corrupt of the Wall Street-owned New Dems, have refused to divest themselves of the bribes from Wey. Needless to say, the DCCC won't give up the $20,000 Steve Israel brought in from him either.