Where Is Southeast Asia in the Panama Papers?

Southeast Asia did not escape investigations by the International Consortium of Investigative Journalists (ICIJ) into the offshore accounts that passed through the Panamanian law firm Mossack Fonseca

By Luke Hunt
April 14, 2016

By any benchmark, the Panama Papers has emerged as a great piece of journalism. The sheer scale of the operation is breathtaking and the revelations have deservedly tarnished the reputations of businessmen, politicians, celebrities, and the just plain wealthy. Particularly poignant is the legitimacy of the journalism involved. The way it was carried out should serve as a lesson to supporters of Julian Assange and Edward Snowden whose dubious methods, which included outright theft, had more to do with grandstanding than public interest.

Southeast Asia did not escape investigations by the International Consortium of Investigative Journalists (ICIJ) into the offshore accounts that passed through the Panamanian law firm Mossack Fonseca.

Prominent in the 7.2 terabytes of leaked documents – that equates to 3,200 tonnes of printed paper – was Cambodian Justice Minister Ang Vong Vathana, who denied any knowledge of investments linking him to a company in the British Virgin Islands.

As one would expect, Cambodia’s involvement on the global scale was tiny. Malaysia, on the other hand, was a different matter. At least 1,784 Malaysians, including the fabulously wealthy sultan of Johor and the sons of three prime ministers, were among those named.

Authorities in both countries went into immediate damage control as the story broke, with those around embattled Prime Minister Najib Razak as well as former Prime Minister Mahathir Mohamad, now one of Najib’s fiercest critics, issuing statements of denial.

It’s a bad look for scandal-prone Malaysia, where Najib’s tenure is under threat from his involvement in the 1MDB scandal. The scandal is just the latest of a string which Najib has seen during his time in government, with the premier also being previously implicated in graft surrounding the acquisition of two French submarines and the murder of Mongolian model Shaariibuugiin Altantuyaa, who worked as a translator on the $1.2 billion dollar deal.

Meanwhile, in Singapore, Indonesia, and the Philippines, financial authorities appropriately warned that the evidence published by the ICIJ would be investigated thoroughly and prosecutions would be launched, according to local laws.

A further 21 Thai nationals were named in the leaks, prompting a warning from the junta that an investigation would also be launched once information was formally received from Panama.

Gavin Greenwood, a regional security analyst with Hong Kong-based Allan & Associates, said the revelations were to date having their greatest impact on countries mainly in the West, where civil society institutions are strong and electorates engaged in the political process. But the impact of the Panama papers on East and Southeast Asia was still largely muted.

This was particularly the case with China, where relatives of leaders (including President Xi Jinping) have also turned up in the Panama Papers – a major embarrassment for a leader who has embarked on a harsh crackdown on corruption.

Reactions in Asia have been less vociferous “not least because corruption scandals or the behavior of the wealthy are almost routine events in most regional countries,” Greenwood said.

“However, revelations of corruption, money laundering, and other financial crimes will affect how named individuals and companies in the region are treated by their counterparts in jurisdictions where due diligence obligations and legislation intended to counter such offenses are set to become a higher priority for law enforcement agencies,” he added.

“Further, the revelations may also be used within elites to discredit rivals or enemies, notably those who have sought to use anti-corruption policies as political weapons against their opponents and who have now been implicated in the same crimes.”

The Chinese tried to strike out what little coverage was afforded the Panama Papers on the mainland in online publications and in newspapers, and to a large extent succeeded. Try as they might, Southeast Asian governments simply don’t have that capacity to do that. That matters, because the ICIJ says it intends to release the tax details of all companies named in the Panama Papers as soon as next month.

Luke Hunt can be followed on Twitter @lukeanthonyhunt

SOURCE thediplomat.com