VIEW POINT: The Panama Papers

When last month - on March 7 - Hussain Nawaz appeared in a private TV channel interview, saying he was the owner of two offshore companies managed by a trust headed by the First Daughter, Maryam Nawaz Sharif, one wondered why would he do that. What was the need for a normally reticent son of the Prime Minister to make such a public confession of involvement in the shady world of offshore firms? We now have the answer from the Panama Papers.
It turns out that for about a year journalists from some 80 countries had been analysing some 11 million files containing documents of a Panamanian law firm, Mossack Fonseca, which provides offshore services. The documents somehow got leaked to a German newspaper and were shared with the International Consortium of Investigative Journalists. Hussain or someone around his father must have heard about the development, hence the decision to do the interview as a pre-emptive damage control measure. Aside from the Sharif family, the Panama leaks identify about 200 high and mighty Pakistani clients of the firm, including legislators, a former judge, the slain PPP leader Benazir Bhutto along with one of her nephews, and former interior minister Rehman Malik. For obvious reasons the names of the Prime Minister's two sons and daughter Maryam Nawaz are the focus of heated media discussions and exchange of accusations and counter-accusations between all the Prime Minister's men and the PTI leader, Imran Khan, who for long has been questioning the Sharif family's acquisition of immensely expensive real estate possessions in London and other businesses abroad.
After the Panama Papers became public, Hussain Nawaz once again came out to confirm that the names of three companies - didn't he mention two firms earlier on - appearing in the leaks are operated by the Sharif family. So what, he seemed to say arguing that there is nothing illegal about offshore companies. Of course not. Doing business through these firms is legitimate, but not so if based on illegitimate resources such as corruption, drug trafficking, tax evasion and money laundering. The real question at this point therefore is not why the Sharif family has been using offshore companies to hide its wealth - which surely is a serious moral issue - but whether or not the money is clean. In his last March's interview Hussain tried to answer that. Professing that when exiled to Saudi Arabia the family was cash-strapped, he said a 'kind friend' had offered financial help to start a business. Nevertheless he stopped short of naming the kind person who handed him so much money to run such a hugely profitable business that allowed him not only to promptly pay back the money but also to own properties in and around London that, according to credible reports, are worth at least 20 million pounds.
The story being as unconvincing as it is, the question that begs an answer is that where did the money come from? If it came from a kind friend he needs to be named and asked to come forward to confirm the story and reveal his own sources of wealth. That is unlikely to happen. A more plausible explanation as to the origin of the money was provided a while ago, in a moment of weakness, by none other than a close confidante and relative of the Prime Minister, Finance Minister Ishaq Dar. In a hand-written statement he presented before a district magistrate in April 2000, Dar had confessed having laundered money on behalf of the Sharifs. In his 43-page affidavit he had listed in detail at least three, real or fictitious, names he had used to open foreign currency accounts to shift the Sharifs' funds abroad so they could offer them as collateral to obtain different direct and indirect credit lines. The activity, as per the affidavit, went on during the second half of the '90s decade.
The Musharraf government did not pursue the case after Nawaz Sharif went into exile and out of his own way. And Dar was to later claim having made the statement under duress. It needs to be noted, however, that credible media reports predating the exile period show the family owned at least two luxury apartments in London as far back as in '96, which corroborates Dar's statement despite his retraction.
In his Tuesday's address to the nation the Prime Minister tried to get away from the subject, blaming the opposition for bringing up "usual baseless accusation" for which, he said, "I have no time." Yet he chose to make that speech knowing full well that at issue are not 'usual allegations' but 'information' leaked from the law firm handling hidden wealth of some of the world' rich and powerful, including his family members. The Panama leaks link wrongdoing with several current and former heads of state and scores of people connected to former and current government leaders. Which is why the scandal has generated widespread anger and dismay, prompting public protests and investigations in various countries. Iceland's prime minister, who along with his wife used an offshore company to hide investments worth millions of dollars, has been forced to resign. Governments in France, Austria, Holland, Australia and India wasted no time to launch investigations against their citizens suspected of involvement in dishonest offshore businesses.
Despite trying to trivialise the issue our PM too felt compelled to do something, so he announced a judicial commission to investigate the affair. Which is nothing more than an eyewash. We all know from experience that such commissions are formed only to cool down tempers. This one is to be headed by a retired judge, most likely a pliable person of the PM's own choosing. The proposed commission is not to even attempt its own investigations - which would require a lot of resources and forensic expertise to follow the money trail. In fact the PM had this to say to his critics: "I ask those who stage a new drama everyday to appear before the commission to prove their claims."
His opponents surely do not have to prove any claims. For, to restate the obvious, the claims have emanated from an outside source that, as the global reaction shows, are being taking very seriously by important world leaders. It is for the Prime Minister to prove that the money used for buying enormous secret assets abroad never underwent laundering. It would help also if he straightens a crook in the family stance. He told the nation on Tuesday the family had made that money from business started with bank credits during his years of exile, and Hussain said in his last March's interview it was given him by a nameless well-wisher. Which of the two statements is to be believed?
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