Last week, a cache of 11.9 million documents tracking the dealings of 14 different offshore services that help ultra-wealthy figures around the world obscure their finances caused a wave internationally.
An investigation led by the Washington, DC-based International Consortium of Investigative Journalists (ICIJ), and a consortium of news organizations across the world have published reports and articles on finding from the “Pandora Papers.”
The investigation comes a few years after a similar leak of documents known as the “Panama Papers” in 2016 that found the Panamanian firm Mossask Fonesca helped clients set up elaborate networks of off shore accounts that are commonly used to conceal assets. In that investigation, the murky dealings of a prominent art world figures, from Spanish heiress Carmen Thyssen-Bornesmiza to Pablo Picasso’s granddaughter, Marina Ruiz Picasso were revealed.
Subjects of the latest findings from the unearthed documents range from art collectors abroad using off shore accounts to store their wares, to dealers in the trade of looted artifacts. Other findings focused on the hidden assets of political figureheads, who have been active in their home countries cultural sectors.
In the Pandora Papers, among the art collectors of focus are Sri Lankan moguls Thirukumar Nadesan and his wife Nirupama Rajapaksa. Documents leaked from Singapore financial services provider Asiaciti Trust showed that the couple kept a group of 31 artworks in a Samoan-registered shell company, Pacific Commodities Ltd. The art is just a small portion of the $18 million in total assets the investigation found in Rajapaksa and Nadesan’s offshore holdings. Rajapaksa formerly served as a member of Parliament, she and comes from a long-reigning political family in Sri Lanka and is the niece of the country’s current prime minister. Documents obtained by the ICIJ also showed Nirupama was is the beneficiary of Pacific Trust, which holds an art collection worth $51 million.
The figure behind the Singapore-based Trust is elusive Australian accountant Graeme Briggs, who established the trust back in 1978. The business has allowed Briggs to amass his own fortune and to procure a multimillion-dollar art and wine collection. The investigation alleges the trust failed to comply with anti-money-laundering and counter-terrorism funding (AML-CTF) rules.
The papers also put a spotlight on embattled antiquities dealer Douglas Latchford. He has been known for his role in illegally trafficking looted antiquities, most often of a sacred nature, from Cambodia. He began dealing in the 1970s, but it wasn’t until 2019 that Latchford was indicted for wire fraud after years of scandal and suspicion. In the complaint filed against him, U.S. investigators laid out how Latchford falsified provenance for stolen items that would eventually be sold to institutions such as the Met Museum and the British Museum. Institutions and collectors turned a blind eye to discrepancies as the chaos of the Cambodian civil war and genocide was often invoked to relax standards of inquiry over provenance.
The Pandora Papers uncovered that Latchford set up trusts and offshore tax havens in 2011 and 2012, named after Hindu dieities, Skanda and Siva respectively, to pass on looted antiquities to his daughter, Julie Latchford, while avoiding British inheritance taxes. Just this past January, Julie Latchford returned her entire collection of Cambodian antiquities, consisting of 125 pieces, to Cambodia. Her father’s finances continue to be investigated.
The Brussels-based Vedovi Gallery founded by Paolo Vedovi was discovered to have used a Hong Kong–based tax haven to avoid paying taxes on the sale of more than $9 million worth of art. Vedovi registered Global Art Portfolio in Hong Kong despite exclusively doing all his business in Europe, which meant that the profits funneled through this haven were never taxed. The Belgian partners in the ICIJ investigation, Le Soir, De Tijd, and Knack uncovered this over the weekend.
Alongside collectors and dealers, the Pandora papers revealed that figures connected to high ranking politicians, with influence in the cultural sector were among the beneficiaries of off shore accounts.
One such figure named in the papers was Andrej Babis, the Czech prime minister. The investigation found that in 2009, Babis allocated $22 million to shell companies to buy a Chateau near Cannes. According to the ICIJ, the entities and property were not disclosed in Babis’ declarations of assets required by the country. Babis has been embroiled in Czech cultural sector scandals in recent years. In April 2019, the Prague’s National Gallery was in turmoil when its director art historian Jiri Fajt was suddenly ousted by the country’s culture minister. The move was seen by the public as having been motivated by politics. It drew a petition from signatories including museum directors Max Hollein at the Metropolitan Museum of Art in New York and Maria Balshaw at Tate Galleries among others in a letter to Babis to reinstate the historian. The new interim director appointed to take Fajt’s place was Ivan Morávek, a former deputy-head of the National Library who previously ran one of Babis’s companies under the agricultural conglomerate Agrofert. The ousting also took place at a time when Babis was working on securing a modern art museum with the Pompidou Center in Paris for the Czech capital.
The investigation also revealed the role of Monaco-based accountancy firm Moores Rowland in overseeing assets of some of Vladimir Putin’s close allies, helping some to amass enormous wealth. The firm set up a network on in-house offshore accounts, taking advantage of Monaco’s lax financial regulations. Gennady Timchenko, a Russian oil trader and media mogul with an estimated $22 billion net worth and member of Putin’s inner circle was among Moores Rowland’s long-term clients. Timchenko has a track record of working to promote Russian heritage abroad. In 2013, Timchenko helped facilitate a partnership with the Louvre Museum to promote Russian art, an effort for which he was awarded the French legion of honor. He also founded the Geneva-based Neva Foundation to back art and cultural initiatives between Switzerland and Russia.
Reporters also discovered the shady dealings of the U.S. sanctioned Ukrainian oligarch and known Picasso collector Ihor Kolomoisky. Documents reviewed by the ICIJ show that Kolomoisky, who controls the government-run Privatbank, was the beneficiary of offshore accounts dating back to 2012. The investigation also linked the dealings of the Ukrainian President Volodymyr Zelensky’s production company Studio Kvartal 95 to Kolomoisky. The Ukranian outlet Slidstvo found that laundered money passed through the oligarch’s Privatbank branch in Cyprus.
Among the biggest revelations in the investigation was the role of the Chicago-based law firm Baker McKenzie along with its international affiliates in assisting high-net-worth clients to obfuscate their financial tracks. The firm’s Malaysian affiliate worked with Jho Low, the fugitive financier and Basquiat collector sought by authorities for allegedly embezzling an estimated $4.5 billion (RM18.8 billion) from the Malaysian economic development fund 1MDB. ICIJ’s reporting found that Low sought the firm’s help in setting up a group of shell companies throughout Malaysia and Hong Kong to funnel capital from a $1 billion deal with a Saudi oil company.
Baker McKenzie was a key player in making Hong Kong a global financial hub, made possible in part due to little financial oversight in the region. Stanley Ho, the Macau casino magnate who died in May 2020 and a collector of Chinese artifacts was one of the firm’s top clients. Ho’s children and fourth wife now control a $6.4 billion fortune amassed by the patriarch, who is known for transforming Macau a gambling hotspot. His ex-wife, Angela Leong registered more than 70 offshore accounts according to documents reviewed by the ICIJ. Now, Pansy Ho, the mogul’s heir and co-chairman of MCM Macau has been credited with rehabing her family’s legacy by taking the casino in a new direction. She oversees the MCM Cotai’s vast art collection, which comprises 300 works by Chinese artists and is said to be worth $12.8 million.
Allan Zeman, the Canadian-born, Hong Kong-based mogul behind the development of Lai Kwai Fong, a bustling tourist attraction in the city’s center, is another client of the firm with art world connections. Zeman, a modern and contemporary art collector and regular of Art Basel Hong Kong, is a prominent figure in the local cultural scene; he is a long-time board member of the West Kowloon Cultural District (WKCD), a Hong Kong arts development project. He told ICIJ that the firm advised him on forming companies in the British Virgin Islands for privacy reasons. “Hong Kong taxes are low enough already,” Zeman said. “Many times you have partners who just don’t want their name associated with something.”
Canadian-born billionaire Joseph Tsai was also implicated in the investigation as a tax-haven beneficiary. Said to be a contemporary art collector, the Canadian executive is the founder of the multi-billion dollar Alibaba Group, a global e-commerce firm. The investigation found that Tsai, who also owns the NBA’s Brooklyn Nets, set up 10 offshore companies registered in the British Virgin Islands, the Cayman Islands and Bahamas to allocate assets before his company went public in the United States.
Sheikh Tamim bin Hamad Al Thani, a member of the Qatari ruling family was also linked to tax havens through which he obscured multi-million dollar real estate transactions. The document show he was able to evade $25 million in taxes on two historic estates in the U.K. Over the years, the Al-Thani royal family, have amassed a vast art collection that includes Mark Rothko’s White Center (Yellow, Pink and Lavender), purchased in 2007 for $72.8 million, and Andy Warhol’s The Men in Her Life, bought from Phillips auction house in New York in 2010 for $63. 4 million.
Embattled Indian businessman Anil Ambani, chairman of the Reliance Anil Dhirubhai Ambani Group, was also found to have obscured funds from the government. Ambani has links with offshore firms that have borrowed or invested an estimated $1.3 billion, including eight firms registered in Jersey, a tax haven near the U.K. He is a member of the Ambani clan, the wealthiest family in Asia; both he and his brother mogul Mukesh Ambani are collectors of Indian artists like MF Hussain, Francis Newton Souza and Navjot Altaf.
The papers also revealed the financial tracks of another embattled Indian mogul. The investigation found documents showing that just one month before diamond magnate Nirav Modi fled the country in January 2018 before being charged with fraud and embezzlement, his sister set up a firm in the British Virgin Islands to preserve a trust set up with Trident Trust Company in Singapore. 72 items from Modi’s collection of luxury wares seized from the government during the investigation were auctioned at Saffronart to the tune of $8 million.
