Panama Papers list Myanmar names
- By Laignee Barron | Tuesday, 17 May 2016
Graphic: Tin Zaw Htway. Click image to expandThe searchable database made public by the International Consortium of Investigative Journalists (ICIJ) includes names of more than 360,000 individuals and companies behind confidential offshore entities. Spanning nearly 40 years, from 1977 to 2015, the information is a tiny fraction of the leaked data, but already links to more than 200 countries and several world leaders.
The ICIJ is careful to note that those included on the database have not necessarily broken any laws. Anonymous companies in some cases have legitimate business purposes, for instance to conduct cross-border asset transfers, or make an investment without tipping off a competitor.
However the leak raises suspicions over the need for secrecy and the potential for misuse cloaked by anonymity.
“Extensive reporting by ICIJ and its media partners for more than four years has shown that the anonymity granted by the offshore economy facilitates money laundering, tax evasion, fraud and other crimes,” the ICIJ says. “Even when it’s legal, transparency advocates argue that the use of an alternative, parallel economy undermines democracy because it benefits a few at the expense of the majority.”
More than half of all companies registered by Panama-based law firm Mossack Fonseca, and nearly all of those that link back to Myanmar, are licensed in the British Virgin Islands. The leaked data reveals the firm went to great lengths to ensure the finances of its elite clientele stayed hidden, for a fee.
Celebrities, politicians and their associates – including friends of Vladimir Putin, relatives of China’s Xi Jinping, individuals linked to Malaysian Premier Najib Razak and the children of former president of the Philippines Ferdinand Marcos – have embraced such covert financial management.
While the leak does not include the financial transactions completed via the shell companies, it does divulge the names and addresses of the previously anonymous owners.
The Myanmar portion of the Offshore Leaks Database reads like a laundry list of tycoon industries, including shipping, titanium, timber, petrol, drilling and auto imports.
U Khin Maung Aye, chair of Cooperative Bank Ltd, is listed on the database as a shareholder and owner of British Virgin Islands-based “Yangon Riverside New City Development Co Ltd”, an officially registered construction company. The offshore entity was created in 2012, and became inactive after defaulting in November last year.
A group of companies related to U Khin Maung Aye, who was adviser to former president U Thein Sein, had five projects approved just before the government changed hands at the end of March. These included the construction of a 440-acre industrial park in Yangon by New City Development Public Company, a CB Bank venture.
The managing director of U Khin Maung Aye’s KMA group and CB Bank officials declined to comment on the offshore company.
Oil magnate U Michael Moe Myint – once referred to in a US diplomatic cable as “perhaps the most legitimate” of Myanmar’s businessmen after having repeatedly refused pressure to “become a crony” – is connected to six companies listed on the Offshore Leaks database. U Michael Moe Myint’s wife and other relatives were also included on the database and connected with British Virgin Islands-registered MPRL E&P and Myint & Associates. According to the US cables, the oil magnate’s companies have been audited several times, with the conclusion that he often overpays his taxes.
Officials at U Michael Moe Myint’s company Myint&Associates hung up on The Myanmar Times when asked about the British Virgin Islands-licensed companies.
The database also includes information from another 2013 expose, with documents from the Singaporean-headquartered Portcullis TrustNet which came under fire for allegations of data breaches and assisting the relatives of region dictators to evade taxes. TrustNet, which self-styled as the largest independent operator in Asia, established two British Virgin Islands firms for U Ne Win’s son-in-law U Aye Zaw Win in the 1990s, including one called Sky-Link Communications LTD, according to the ICIJ.
Other names on the database include U Myint Swe, U Kyaw Win, U Htay Myint, Daw Mya Thida Swe Win and Joern Kristensen, a former Myanmar representative for the Australian company Institute for International Development.
According to the database, IID Co Ltd was incorporated in the British Virgin Islands in 2012, with Mr Kristensen listed as both shareholder and beneficiary until the account became inactive in 2015. Mr Kristensen says the account was used for legal, above-board purposes to try to enable payments to a Singaporean bank account while Myanmar was still subject to sanctions.
“At that time, most embargoes and sanctions on Myanmar were still in place, and bank transfer into the country was extremely challenging, most companies and NGOs brought in their funds in cash, while outbound transfer was, and remain[s], impossible,” Mr Kristensen said, adding that he was surprised to find his name listed among the Panama Papers leak.
“I, and I would think that is the case for several of the other people whose names are found in the Panama Papers, have done nothing wrong,” he added.
According to Edwin Vanderbruggen, a legal partner at law firm VDB Loi, many of the offshore entities are a holdover from an era when it was nearly impossible to move foreign currency in or out of the country.
“I think a lot of importers and exporters needed companies and bank accounts overseas for practical reasons. Whether any laws were broken remains to be seen, but in itself this is certainly not an ominous purpose,” he said. “Of course, it is almost certain that offshore centres have also been used for a variety of other uses in connection with Myanmar which would raise much more concern.”
According to a Central Bank official, overseas finances are managed through the 2012 Foreign Exchange Management Law. Myanmar nationals can open bank accounts abroad with the approval of the Central Bank. Under the law, residents and companies must report to the Central Bank all transactions involving their overseas accounts. The law was passed in 2012, but the Central Bank has told The Myanmar Times that, as of earlier this year, it has not received any reports from residents.
By watchdog group Tax Justice Network’s estimate, a large share of the world’s wealth is parked in tax havens. In 2012, the group suggested that between US$21 trillion and $32 trillion of financial assets were “sitting offshore, largely untaxed”.
The problem is particularly acute in Myanmar where illicit cash flows dominate, slashing government tax revenue and fuelling an underground economy.
Last year US-based Global Financial Integrity reported that nearly $100 billion in dirty money flowed through Myanmar from 1960 to 2013. Almost $19 billion left Myanmar over that period, draining funds from the official economy. Nearly $80 billion in illicit funds entered the country, indicating smuggling profits make up a significant portion of the economy. Nearly half of those inflows occurred during the last four years of the study.
GFI said correcting illicit financial flows needs to be a government priority.
The Central Bank is hoping the new government will support enforcing and enhancing laws which require all residents with overseas bank accounts to submit regular reports to the monetary authority, which would allow it to collect better data on capital flows, offshore holdings and Myanmar investment overseas.
“Whether or not the Panama Papers leak is valid, there are probably such kinds of businesspeople who want to evade taxes,” said government spokesperson U Zaw Htay. “We will focus on improving the rule of law when dealing with tax issues. Tax evasion is against our rules and laws and we will try to restrict such activity.”
U Zaw Htay declined to comment on specific names on the database, including accusations made on social media that the U Myint Swe on the list refers to the vice president.
To search the database, click here.
Ref;http://www.mmtimes.com/index.php/national-news/20325-panama-papers-list-myanmar-names.html
Tax haven secrecy revealed
Offshore Leaks Database
Search results for “Myanmar”
- Offshore Entities (17)
- Officers (3)
- Intermediaries (0)
- Addresses (20)
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| C & P MYANMAR PTE LTD. (name changed to Myanmar International Terminals Thilawa Private Limited) | Singapore | Panama Papers |
| HUTCHISON PORTS MYANMAR LIMITED | British Virgin Islands | Panama Papers |
| Poscelin Myanmar Limited | Hong Kong | Offshore Leaks |
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