Brazilian ministers cited in Pandora Papers scandal say their companies are legal

The two main officials of Brazil cited in the Pandora Papers, the new international journalistic investigation into the alleged concealment of money by dozens of world personalities, clarified this Sunday that their companies abroad are legal and declared.

The clarification was made by the Brazilian Minister of Economy, Paulo Guedes, and by the president of the Central Bank -whose position has ministerial status-, Roberto Campos Neto, in statements released after their names were cited in the report published this Sunday by the International Consortium of Investigative Journalists (ICIJ, for its acronym in English).

According to the follow-up made to the questioned transactions carried out by the Panamanian law firm Alcogal to supposedly help politicians, businessmen and millionaires from around the world to hide their resources in companies registered in tax havens in order not to pay taxes, among the beneficiaries are Guedes and Campos Net.

Both, however, clarified that all their private activities abroad are declared before the Brazilian tax authorities, including the Federal Tax Administration and the Public Ethics Commission, and that they do not violate the law.

According to reports reproduced by four Brazilian media that participated in the investigation, the offshore Dreadnoughts International, based in the British Virgin Islands, was founded by Guedes in September 2014 and received deposits of 9.54 million dollars until September, when it was still active.

In the same way, the company Cor Assets, opened by the president of the Brazilian issuer in April 2004 in Panama, received deposits of 2.2 million dollars until August 2020, when it was closed.

The name of Campos Neto also includes a company opened in the British Virgin Islands and which was active between January 2007 and November 2016.

In his statement, the Minister of Economy said that all his private activities, influencing companies opened abroad, were reported to the Brazilian control bodies when he took office, in January 2019.

The note adds that Guedes dissociated himself from all his activities in the private market since he took office as minister, as determined by the Public Ethics Commission.

Campos Neto, for its part, affirmed that its companies abroad appear on its income tax declaration since they were opened and that it has paid in Brazil the due taxes on the profits generated by them.

He added that such companies were opened 14 years ago with the resources he obtained during 22 years working in the financial market, and that, since he became president of the Brazilian Issuer, he has not made any transfers to such accounts.

According to Brazilian legislation, the opening and maintenance of bank accounts or companies abroad is not illegal as long as they are declared before the Federal Tax Administration and other authorities.

In the ICIJ investigation, called the Pandora’s Papers”, 600 journalists participated who have examined 1.9 million documents.

Among the personalities who used Alcogal’s services, described as “A magnet for the rich and powerful (…) who seek to hide wealth abroad”, Three former presidents of Panama stand out, the current president of Ecuador or the king of Jordan.