The partners of the law firm Mossack Fonseca, Ramón Fonseca and Jürgen Mossack, were arrested in Panama City in February, but were granted bail by a Panamanian court last month. Each paid $500,000 USD to be set free according to their lawyer, Guillermina McDonald. Their cooperation with the investigation against them made them an unlikely flight risk according to McDonald. Edison Teano, another lawyer associated with the firm, has not been released.
The lawyers were made famous by their firm’s involvement in the Panama Papers scandal, which as a result of a leak revealed high-level entrepreneurs and politicians holding offshore accounts in Panama.
Panama’s Attorney General, Kenia Porcell, defended the arrest by pointing to evidence that allegedly incriminates Mossack Fonseca “as a criminal organization that is dedicated to hiding assets or money from suspicious origins…Put simply, the money comes from bribes, circulated via certain corporate entities to return bleached or washed to Panama.”
Porcell further expressed her appreciation to the authorities in Brazil, Ecuador, Colombia, Peru, Switzerland, and the United States for their contributions to the investigations that have been ongoing for over a year.
The arrests of Mossack Fonseca are in part due to their involvement in corruption charges against Latin America’s largest construction firm, Odebrecht, whose headquarters is in Brazil, as well as their involvement in other Brazilian “Lava Jato” corruption scandals. Last year, Odebrecht pled guilty to paying bribes totaling 1 billion USD in exchange for construction contracts in 12 different nations, including Panama, between 2010 and 2014.
The “Panama Papers” leaked last April from Mossack Fonseca’s law firm and revealed over 11 million pieces of evidence relating to thousands of offshore accounts used for tax evasion purposes.
In response to questions about his arrest, Fonseca replied that “Mossack Fonseca has no relationship with Odebrecht, nor with any other Lava Jato company.” He added, “They’re using me to divert attention.”
Fonseca was once a government official under Panama’s President Juan Carlos Varela. He chose to step down from his post last year as accusations spread about his law firm being linked to Brazilian oil company Petrobras’ corruption scandals. He then revealed that the Panamanian president had received bribe money from Odebrecht. Varela denies the claims, stating his intention to publicize his campaign contributions to prove his innocence.
