The leak of the highly-sensitive Panama Papers, which detailed how political leaders and the super rich conduct business behind a veil of secrecy, is provocative. The 11.5 million documents, held by Panama-based Mossack Fonseca, released to a German newspaper and the International Consortium of Journalists, have caused upheavals around the world. Fonseca, reputed to be the world’s fourth largest offshore law firm, helps clients to register offshore entities, which are sometimes used to launder money and evade tax. Not surprisingly, some of Nigeria’s top politicians have been mentioned. The Federal Government should swiftly investigate them in order to establish their culpability or otherwise, as other countries are doing so.
It is estimated that between $21trillion and $32 trillion of private financial wealth is located, untaxed, or lightly taxed, in tax havens and more than £1 trillion per year of illicit cross-border financial flows around the world, according to The Guardian (UK). For now, 12 heads of state or government, including Britain’s David Cameron, Ukraine’s Petro Poroshenko, Zayed al-Nahyan of the UAE, Salman al-Saud of Saudi Arabia, the associates of Vladimir Putin of Russia, and 143 other global political leaders, are cited as exploiting the offshore tax regimes. Wealthy sports icons and celebrities like Lionel Messi of Argentina and Gianni Infantino, the new FIFA president, are included. On Saturday, a protest rocked Malta, with marchers calling on the Prime Minister, Joseph Muscat, to resign following the accusation that two of his associates were implicated.
At home, where the Muhammadu Buhari Administration is cracking down on corruption, those fingered in the Panama Papers include the Senate President, Bukola Saraki; former Senate President, David Mark; former Delta State governor, James Ibori; and Theophilus Danjuma, a former Army Chief and Minister of Defence. Saraki and Mark have denied the allegations.
But the denials by the public office holders are not enough. The Nigerian government must dig deep into the exposé. Therefore, the call by the Transition Monitoring Group, the Socio-Economic Rights Accountability Project and the Coalition Against Corrupt Leaders for the government to institute a probe should not be ignored.
First, it should be established when those who have been mentioned ran the companies. Were they in public office when they opened the offshore accounts? Did Mark establish the companies while he was a military governor or Minister of Communications? Did Danjuma get involved when he was the COAS or later when he was minister? Was Ibori a governor when he signed with Fonseca? Did these political office holders declare these companies and incomes in their official submissions, as provided for in the Code of Conduct Bureau law? Part 1, Section 7 of the CCB law states, “Any public officer specified in the Second Schedule to this Act or any other persons as the President may, from time to time, by order prescribe, shall not maintain or operate a bank account in any country outside Nigeria.” Did these officials violate this law? Only an investigation will establish the truth.
Unlike other polities, our response to the Panama Papers has been predictably slow and unimpressive. Nigerians are too comfortable with corruption. Yet, the reactions from London to Reykjavik and Nyon to Washington DC have been instant and purposeful. Cameron is facing a mutiny from his own Conservative Party after the disclosure that his late father, Ian, ran a company in the tax haven, which the son profited from to the tune of £19,000 before becoming the prime minister in 2010. Although a YouGov poll last Friday said 82 per cent of Britons were not surprised about the Panama Papers, Jeremy Corbyn was shown to be leading Cameron in popularity ratings for the first since he became Labour leader last year.
The leak has claimed a major political scalp after Sigmundur Gunnlaugsson was forced to resign last Tuesday as the prime minister of Iceland. We wonder if this will ever happen to any of our political leaders. In China, political leaders are contending with the fact that Li “Power Queen” Xiaolin, a daughter of former Premier Li Peng, is profiting from owning offshore shell companies. The Swiss police have searched the Nyon offices of the European Football Union, looking for documents linking Infantino, the body’s former general-secretary, to secret deals. That is the way Nigeria should act – swiftly.
France, Spain, the United States and Australia have opened investigations into the matter. The US Department of Justice is probing whether any of its nationals is involved. In Chile, the president of Transparency International, Gonzalo Delaveau, quit his post after being linked to five offshore shell companies. It’s the same for Michael Grahammer, the head of Austria’s Landesbank Vorarlberg, whose bank was cited.
Yet, corruption is the bane of Nigeria. The funds that should have been deployed to build infrastructure have been siphoned by a corrupt few. In January, the Federal Inland Revenue Service told a House of Representatives committee that Nigeria lost N1 trillion to tax evasion on crude oil swap between the NNPC and private oil companies. Last year, Buhari said $150 billion of oil revenue had been looted by the corrupt political elite in the 10 years to 2015. Of course, most of the ill-gotten wealth is laundered overseas. The government must leave no stone unturned in investigating these allegations, and mete out appropriate sanctions to the culprits.
The Panama Papers are more than just tax evasion and owning shell companies. They illustrate widespread political corruption. But they also offer us a fresh opportunity to move against graft. We should not just express outrage and allow the matter to fizzle out as usual. The Attorney General of the Federation and Minister of Justice, Abubakar Malami, should liaise with the international community to track the Nigerians mentioned.
The Panama Papers scandal should not go the way of other corruption cases such as Halliburton and Siemens. Nigerians were allegedly bribed $182 million for Halliburton to win contracts in the country, while German court papers said four Nigerian ministers received bribes totalling $17 million in the Siemens incident. While the prominent Nigerians concerned were let off the hook by the government, their accomplices in Germany and the US were prosecuted, fined and jailed.
To monitor public officials who stash away their loot abroad, the Economic and Financial Crimes Commission should establish a specific desk of dedicated officers to track the international transactions of political office holders. An institutionalised tracking system will offer no comfort for kleptomaniac officials again. The Buhari government should adopt the attitude of Francois Hollande, the French President, who describes the disclosure as “good news,” because “it will bring in tax revenue from those who have defrauded.”
