A new trove of millions of leaked documents released Sunday, dubbed the Pandora Papers, details how a number of global leaders have used offshore havens to stash their wealth, while also shining an unwelcome spotlight on Baker McKenzie.
The International Consortium of Investigative Journalists, which obtained the records, highlighted Baker McKenzie’s role in creating the modern offshore system, contending that the global firm also continues to help clients navigate this shadow economy.
The leaked files in the Pandora Papers came from a group of 14 offshore service providers, including law firms based in Cyprus, Panama and Belize.
The ICIJ’s reporting contends that Baker McKenzie and its global affiliates have used their lobbying and legislation-drafting knowledge to shape financial laws around the world, but it does not reveal how these documents allowed it to arrive at that conclusion.
Baker McKenzie acknowledged lobbying governments and policymakers in a statement released Sunday.
“Like other law firms and relevant industry or subject matter experts, Baker McKenzie is regularly requested to assist governments and regulatory bodies with the analysis and development of potential new legislation in countries around the world, by contributing our legal expertise and experience,” the firm said. “We are also asked by clients to provide expert input on proposed laws and regulations, including through public submissions processes or occasionally by legislative testimony. All our work in this area is done in compliance with applicable laws and regulations, including lobbyist registrations where required.”
The ICIJ highlighted certain clients that Baker McKenzie allegedly helped guide through the offshoring process. It said that the firm has done work for Ukrainian oligarch Ihor Kolomoisky, who, according to U.S. authorities, laundered $5.5 billion through a group of of shell companies, purchasing factories and commercial properties across the U.S., including in Cleveland, Dallas and northern Illinois.
The reporting also said Baker McKenzie did work for Jho Low, the Malaysian businessman and international fugitive who has been accused by authorities across the globe of embezzling $4.5 billion from the 1MDB economic development. According to the ICIJ, Low relied on Baker McKenzie and its affiliates to help him and his associates build a web of companies in Malaysia and Hong Kong to shield his wealth.
The firm also defended its tax advisory work in the statement.
“Taxation is a core area of our global expertise. Our advice is always in strict accordance with all applicable laws and regulations,” it said. “Transparency and accountability are integral elements of such advice and we strive to ensure that our clients adhere to both the law and best practice.”
In discussing its methods, the ICIJ also said that it read through several thousand publicly available employees’ profiles and found out that more than 220 lawyers associated with Baker McKenzie in 35 countries had previously held government posts in agencies including justice departments, tax offices, the EU Commission and offices of heads of state.
Baker McKenzie has appeared in previous ICIJ reporting based on other batches of leaked data. The Paradise Papers, dating from 2017, focused on a leak from “offshore Magic Circle” firm Appleby. These provided particular details on corporations using offshore tax havens to protect profits from taxation, and they revealed that Appleby’s collaborators included Baker McKenzie and Akin Gump Strauss Hauer & Feld, along with Big Four firms KPMG, Ernst & Young and PricewaterhouseCoopers.
Baker McKenzie also voiced its support for a more global tax system.
“Baker McKenzie supports the development of a simplified, consistent and well understood global tax system, and works towards collaboration between different stakeholders for systems of taxation that balance the interests of businesses, citizens and governments,” the firm said.
This article was sourced from law.com