Panama Papers: What India Should Do To Get Mossack Fonseca Files

Will India succeed in procuring the Panama Papers? Here is what agencies should do.

It’s still early days in the probe of possible financial irregularities by Indians named in the Panama Papers, but Indian investigators have a brief outline in place.

It’s worth remembering that in the past, India failed to access bank accounts in HSBC and Liechtenstein banks due to the lack of a Mutual Legal Assistance Treaty (MLAT). We could see a repeat of that in the Panama Papers leak too – India doesn’t have a similar treaty with Panama. This means that the Panama government is under no compulsion to share any documents.

Does that mean a dead-end in probe efforts? Not necessarily. Investigators say that the probe can reach a logical conclusion, provided there is political will. Here’s how the government can proceed.

Watch: #PanamaPapers: Who’s Who & What’s What of the Leak of the Century

1) The multi-agency committee formed by the govt should request the Panama govt to freeze bank account details and other documents which are in possession of the law firm Mossack Fonseca. However, reports suggest that the firm has been known to delete virtual data and burn physical documents, in the past, in order to protect clients.

2) The Financial Intelligence Unit (FIU) can collect information on the 500 Indians mentioned in the Panama Papers, from documents in possession of the International Consortium of Investigative Journalists (ICIJ).

3) Based on information with the FIU, the income tax department is likely to register a case under the Black Money Law. According to sources, the case should not only establish tax evasion but also corruption.

4) A Letter Rogatory (LR) should be sent to the United Nations Convention rather than the Panama government since India does not have a treaty with that country. Sources say a strong corruption case is essential for the UN Convention to push Panama to cooperate with India.

5) Alongside the IT department, the Enforcement Directorate should register a case under money-laundering.

Indian investogators’ primary focus will be to check if any of the 500 Indians who have been named, have indeed committed any illegalities in offshore financial transactions.

Agencies so far have not achieved much success in the HSBC or the Liechtenstein tax affair. In spite of the Black Money Law, high-profile perpetrators go scot free. Whether the Panama leaks case will be an exception, is something that only time can tell.