Brazil Ministers cited in Pandora Papers scandal claim their companies are legal and declared

RIO DE JANEIRO, BRAZIL – The two main Brazilian officials cited in the Pandora Papers, the lastest international journalistic investigation on alleged money concealment by dozens of world personalities, clarified on Sunday that their companies abroad are both legal and declared.

The statement came from Brazilian Economy Minister Paulo Guedes and Central Bank President Roberto Campos Neto – whose position has ministerial status – in press releases issued after their names were cited in the report published on Sunday by the International Consortium of Investigative Journalists (ICIJ).

According to the tracking of transactions conducted by Panamanian law firm Alcogal to allegedly help politicians, entrepreneurs and millionaires from all over the world to conceal their resources in companies registered in tax havens to evade paying taxes, Guedes and Campos Neto are among the beneficiaries.

However, both clarified that all their private activities abroad are declared to the Brazilian tax authorities, including the Federal Treasury and the Public Ethics Committee, and that they are not in violation of the law.

According to reports published by 4 Brazilian media outlets involved in the investigation, the offshore company Dreadnoughts International, based in the British Virgin Islands, was founded by Guedes in September 2014 and received deposits amounting to US$9.54 million through September of this year, when it was still active.

Similarly, Cor Assets, opened by the president of the Brazilian central bank in April 2004 in Panama, received deposits for US$2.2 million through August 2020, when it was closed.

A company opened in the British Virgin Islands and which was active from January 2007 through November 2016 is also listed in Campos Neto’s name.

In his statement, the Economy Minister said that all his private activities, including the companies opened abroad, were reported to Brazil’s auditing bodies when he took office, in January 2019.

The note adds that Guedes disassociated himself from all his activities in the private market since becoming Minister, as determined by the Public Ethics Committee.

In turn, Campos Neto stated that his companies abroad are included in his income tax return since they were opened and that he has paid taxes in Brazil on the profits made.

He added that these companies were opened 14 years ago with the funds he raised during 22 years working in the financial market, and that, since becoming president of the Brazilian Central Bank, he has not made any transfers to these accounts.

According to Brazilian legislation, opening and maintaining bank accounts or companies abroad is not illegal provided that they are declared to the Federal Treasury and other authorities.

The Pandora Papers ICIJ investigation involved 600 journalists who examined 1.9 million documents.

Among the personalities who used Alcogal’s legal services, described as “a magnet for the wealthy and powerful (…) who seek to conceal wealth abroad,” are 3 former presidents of Panama, the current president of Ecuador and the king of Jordan.