{"id":4472,"date":"2016-05-09T00:00:00","date_gmt":"2016-05-09T00:00:00","guid":{"rendered":"https:\/\/amabhungane.org\/amabhungane\/stories\/malefactors-of-mossack-fonseca-meet-the-dutchman-the-queen-of-the-south-and-the-boss-of-bosses\/"},"modified":"2024-09-24T10:32:56","modified_gmt":"2024-09-24T10:32:56","slug":"malefactors-of-mossack-fonseca-meet-the-dutchman-the-queen-of-the-south-and-the-boss-of-bosses","status":"publish","type":"post","link":"https:\/\/further.co.za\/amabwp\/malefactors-of-mossack-fonseca-meet-the-dutchman-the-queen-of-the-south-and-the-boss-of-bosses\/","title":{"rendered":"Malefactors of Mossack Fonseca: Meet The Dutchman, the Queen of the South and the Boss of Bosses"},"content":{"rendered":"

Picture: ICIJ<\/em><\/p>\n

In November 2005, customs officials at the Dutch port of Rotterdam got a tip: a shipment of asparagus from Peru might contain something besides vegetables.<\/p>\n

About a week later, 60 pallets of tinned white asparagus came into port inside three shipping containers. Eighty percent of the cans contained asparagus. The rest contained cocaine \u2013 more than one and a half tons of it.<\/p>\n

Dutch and Peruvian authorities said a man known in Peru as The Dutchman \u2013 Ment Dijkhuizen C\u00e1ceres \u2013 was behind the industrial scale drug trafficking. Investigators found that he and his attorney, Eduardo Gallardo Arciniega, used a series of offshore shell companies to launder the money.<\/p>\n

Dijkhuizen and Gallardo registered at least four of those front companies at Mossack Fonseca, the Panama-based law firm that has become known worldwide for creating hard-to-trace offshore companies by politicians, wealthy investors and, in many cases, notorious criminals.<\/p>\n

Dijkhuizen is one of Mossack Fonseca\u2019s malefactors \u2013 convicted felons and alleged wrongdoers who have benefited from services provided by the law firm that\u2019s at the center of the \u201cPanama Papers\u201d scandal.<\/p>\n

They come from the United States, the United Kingdom, Spain and many other lands. They include mobsters, drug traffickers, arms smugglers, Ponzi schemers and other criminal figures, a review of the law firm\u2019s internal files by the International Consortium of Investigative Journalists and other media partners has found.<\/p>\n

Mossack Fonseca\u2019s internal files include companies tied to at least 36 Americans who have been accused or convicted of fraud or other serious financial misconduct. The law firm\u2019s files also include at least 33 people and companies blacklisted by the U.S. Treasury Department because of evidence that they\u2019d been involved in wrongdoing, such as doing business with Mexican drug lords or terrorist organizations like Hezbollah.<\/p>\n

Mossack Fonseca has told ICIJ and other media partners that it \u201cdoes not foster or promote unlawful acts.\u201d<\/p>\n

It said it relies on middlemen that it refers to as its \u201cclients\u201d \u2013 bankers, lawyers and other operatives that feed it business \u2013 to make sure that people who get offshore companies through the law firm aren\u2019t involved in criminal activity. The law firm said it also has its own screening procedures designed to identify suspect customers \u201cto the extent it is reasonably possible.\u201d<\/p>\n

In cases when companies formed by Mossack Fonseca ended up in the hands of criminals, a spokesman said, the firm has \u201cstrongly condemned that situation\u201d and taken actions to deal with the problem.<\/p>\n

The firm declined to answer questions about offshore companies linked to Dijkhuizen and five other notorious figures whose case histories are explored in this story \u2013 including a drug boss known as \u201cQueen of the South,\u201d an American con man who set up a fake charity in the name of a Catholic saint and an alleged mobster known as the Russian underworld\u2019s \u201cBoss of Bosses.\u201d<\/p>\n

Fine and Educated Ways<\/strong>
\nName:<\/strong> Ment Floor Dijkhuizen C\u00e1ceres
\nNationality:<\/strong> Peruvian
\nClaim to Fame:<\/strong> Drug Trafficker
\nLocale:<\/strong> Peru and The Netherlands
\nAKA:<\/strong> El Holand\u00e9s (The Dutchman)<\/p>\n

Ment Dijkhuizen\u2019s cocaine ring had been under scrutiny for years, long before his arrest. Sandra Barrios Villacorta, secretary to a key figure of Dijkhuizen\u2019s organization who had been arrested, was murdered while walking her daughter to school. Police suspected she \u201cknew too much,\u201d according to La Republica.<\/p>\n

After learning in 2006 that Dijkhuizen had been the target of a massive drug bust, J\u00fcrgen Mossack, Mossack Fonseca\u2019s co-founder, expressed surprise that his law firm had taken on such a man as a customer. \u201cThere are bank accounts?\u201d Mossack wrote. \u201cWe are signatories? . . . I’m wondering what kind of due diligence is made in Peru on customers?\u201d<\/p>\n

Monica Ycaza, Mossack Fonseca\u2019s Peru representative, wrote back that there were was no way she could have known.<\/p>\n

Dijkhuizen\u2019s lawyer, Gallardo, who arranged for the companies to be created, was \u201ca person of fine and educated ways, which gave us no cause to doubt him,\u201d Ycaza said.<\/p>\n

The Drug Queen<\/strong>
\nName:<\/strong> Marllory Dadiana Chac\u00f3n Rossell
\nNationality:<\/strong> Guatemalan
\nClaim to Fame:<\/strong> Drug Trafficker, Money Launderer
\nLocales: <\/strong>Guatemala, Honduras, Panama, Mexico, United States
\nAKA:<\/strong> Queen of the South<\/p>\n

In January 2012, U.S. authorities identified Marllory Dadiana Chac\u00f3n Rossell as \u201cone of the most prolific narcotics traffickers in Central America.\u201d U.S. Treasury officials accused her of sending thousands of kilos of cocaine through Guatemala to the United States and laundering tens of millions of dollars each month.<\/p>\n

It\u2019s rare enough for a woman to obtain drug lord status that the Guatemalan press dubbed her, \u201cQueen of the South.\u201d<\/p>\n

At the height of Chac\u00f3n Rossell\u2019s reign, she and her family lived opulently in Guatemala City, mixing with politicians and high society and vacationing in Europe. By the time she was in her late 30s, she was the mother of five and the ruler of a business empire that included hotels, a national lottery, a construction firm and a high-end clothing store. U.S. officials identified 24 business entities connected to her.<\/p>\n

Mossack Fonseca played a role in her kingdom, the law firm\u2019s internal records show.<\/p>\n

In 2008, the law firm helped establish Brodway Commerce Inc. Chac\u00f3n Rossell was listed as director and president. Mossack Fonseca also helped the company create accounts with Panama\u2019s Banvivienda Bank and Guatemala\u2019s Banco Reformador. By October 2009, the Banco Reformador account held $12 million, the records show.<\/p>\n

In 2015, Chac\u00f3n Rossell cut a deal with the U.S. Justice Department, winning a reduced sentence in exchange for her cooperation with American authorities. Her actual punishment has been kept secret and a judge ordered the case sealed for five years.<\/p>\n

Operation White Whale<\/strong>
\nName:<\/strong> Fernando del Valle
\nNationality:<\/strong> Chilean
\nClaim to Fame:<\/strong> Money Launderer
\nLocale:<\/strong> Spain<\/p>\n

In 2005, Spanish authorities arrested 50 people in Operation White Whale, an investigation of what was called the largest money-laundering ring in Spain\u2019s history. At the center of the alleged $300 million laundering operation, prosecutors said, was a Chilean lawyer named Fernando del Valle, who set up shell companies that helped drug dealers, mafiosos, arms traffickers and pimps plow dirty money into real estate.<\/p>\n

In 2007, two years after he was arrested in the White Whale case, del Valle got Mossack Fonseca to reactivate a company he had formed in 1979 called Nitel Values SA.<\/p>\n

Mossack Fonseca didn\u2019t learn of del Valle\u2019s arrest until 2009, when he asked to create a new company for a German client. About a month later, Mossack Fonseca resigned as registered agent of Nitel Values.<\/p>\n

In 2011 a Spanish court sentenced del Valle to more than six years in prison for money laundering and tax fraud.<\/p>\n

To-Do List<\/strong>
\nName: <\/strong>Martin Frankel
\nNationality:<\/strong> American
\nClaim to Fame:<\/strong> Fraudster
\nLocale:<\/strong> United States<\/p>\n

In February 2000, U.S. authorities approached Mossack Fonseca through the attorney general of the British Virgin Islands, demanding information on two offshore companies\u00a0 owned by colorful financial criminal Martin Frankel. He had been a longtime customer of the law firm, even while embezzling more than $200 million from insurance companies in five states and then taking some of the money on the lam once discovered.<\/p>\n

Frankel also set up a sham charitable foundation named after a Catholic saint that promised to raise money for the poor but instead bankrolled his lavish lifestyle, which included mansions, luxury cars, bodyguards and a bevy of girlfriends.<\/p>\n

When Frankel fled the U.S. in 1999, authorities said, he left behind an astrological chart drawn up to answer the question \u201cWill I go to prison?\u201d and a to-do list that included \u201claunder money.\u201d When authorities finally caught up with Frankel in Hamburg, Germany, they found 547 diamonds and nine fake passports.<\/p>\n

Mossack Fonseca took several months to respond to the official request for documents in 2000. During the interim, it worked to shut down companies linked to Frankel and disengage from its association with him. In 2002, Frankel pleaded guilty to 20 counts of wire fraud as well as counts of securities fraud and racketeering conspiracy.<\/p>\n

Guns and Money<\/strong>
\nName: <\/strong>John Knight
\nNationality:<\/strong> British
\nClaim to Fame:<\/strong> Arms Trafficker
\nLocale: <\/strong>UK<\/p>\n

In November 2004, John Knight admitted that he had negotiated with Sudan to supply it with tanks, rocket launchers, artillery guns, and Soviet airplanes\u2014while it was engaged in genocide in Darfur.<\/p>\n

Knight was already known in Britain. In 1991, a reporter from the Daily Mirror had gone undercover and arranged a deal to buy Kalashnikovs from him. When The Scotsman newspaper asked Knight in 2004 why he would sell weapons to the Sudanese regime, Knight pointed to Adolf Hitler, saying \u201cpeople were supplying him with stuff. He was the biggest tyrant of the lot.\u201d<\/p>\n

Through an intermediary in Cyprus, Knight bought a British Virgin Islands shell company called Endeavour Resources Limited from Mossack Fonseca in 2005. He used that company to traffic arms in the Middle East, according to the British government.<\/p>\n

In 2007, British customs authorities raided Knight\u2019s $3 million house outside London in search of evidence he had been trading weapons with Iran. They found shredded documents, which, when pieced together later, showed Knight created a false trail to cover up his plan to buy 130 automatic weapons from Iran and sell them to Kuwait via Endeavour Resources. He was sentenced to four years in prison for the scheme.<\/p>\n

Mossack Fonseca resigned as registered agent for Endeavour Resources, but it remains the agent for Business Systems Consultant Ltd., a Bahamian company that was listed as Endeavour Resources\u2019 director.<\/p>\n

Boss of Bosses<\/strong>
\nName:<\/strong> Semion Mogilevich
\nNationality: <\/strong>Ukrainian
\nClaim to Fame:<\/strong> Called \u201cthe most dangerous mobster in the world\u201d
\nLocale: <\/strong>Moscow
\nAKA:<\/strong> the Boss of Bosses; the Brainy Don; Mr. Bigski; Seva<\/p>\n

In 2009, the FBI named Semion Mogilevich to its Top Ten Most Wanted fugitives list, calling him a \u201cglobal con artist and ruthless criminal\u201d who was \u201cinvolved in weapons trafficking, contract murders, extortion, drug trafficking, and prostitution on an international scale.\u201d Known as the Boss of Bosses, the chain-smoking, portly Ukrainian\u2019s signature method of neutralizing an enemy was the car bomb, The Guardian reported.<\/p>\n

Mogilevich got his start in organized crime fleecing fellow Soviet Jews immigrating to Israel, according to The Independent. He eventually set up operations in Hungary and in Israel.<\/p>\n

An indictment secured by U.S. authorities in 2003 charged Mogilevich with being behind the fraud at YBM Magnex International, a publicly traded Pennsylvania company that bilked investors out of $150 million.<\/p>\n

Mogilevich had several close connections to shell companies registered by Mossack Fonseca, though none appear to have been in his name. In 2001, the attorney general\u2019s office of the Bahamas wrote Mossack Fonseca requesting information about Rosebud Consultants Inc., a company registered by the law firm in Nassau. Bahamian officials were acting in response to request from U.S. authorities who were investigating what they alleged were payments made to Mogilevich through Rosebud and his attorney Adrian Churchward in connection with the YBM Magnex scandal. Mossack Fonseca\u2019s own files don\u2019t show any links between Churchward and Rosebud, but the investigative request said U.S. prosecutors believed Churchward was \u201cassociated\u201d with Rosebud and that the company was funneling $20,000 a month in \u201cconsulting fees\u201d to Mogilevich.<\/p>\n

Churchward was also director of Trinity Films Inc. along with Galina V. Grigoryeva, who was married to Mogilevich and later to Churchward. Mossack Fonseca registered that company in March 1996 in the Bahamas.<\/p>\n

Churchward now writes thrillers, including \u201cMoscow Bound,\u201d about the estranged wife of a Russian oligarch and a lawyer on the run for a crime they didn\u2019t commit. After the release of the initial Panama Papers stories, Churchward was heavily critical of the offshore industry, saying on Twitter that the rich and powerful have \u201ca tight grip on their corruption.\u201d<\/p>\n

\u201cNothing will change,\u201d he added. \u201cThe \u2018Global elite\u2019 and their political servants aren’t turkeys who are about to vote for Christmas.\u201d<\/p>\n

Asked for comment on his connection to companies at Mossack Fonseca, Churchward said in a email: \u201cMy lawyers have advised me that if Mr Moguilevitch goes to trial I may be called by either the prosecution or defence to give testimony as a witness and, as such, I should not comment on any aspects of any alleged relationship with Mr Moguilevitch, business or otherwise.\u201d<\/p>\n

Another Mogilevich connection in the Panama Papers is Igor Fisherman, a Ukrainian-born American charged alongside Mogilevich by the U.S. in the YBM Magnex scam. Fisherman\u2019s wife Olga Zhunzhurova held power of attorney over Hastan Finance SA,\u00a0 a company purchased in the Seychelles, an offshore haven in the Indian Ocean, through an intermediary in Switzerland.<\/p>\n

The FBI said in 2009 that Mogilevich was living in Moscow. In 2015, the agency took him off its \u201cTen Most Wanted\u201d list, noting that \u201cthe extensive national and international publicity afforded him has not generated information which would assist in his apprehension.\u201d<\/p>\n

Mogilevich could not be reached for comment for this story. In a 1999 article, the New York Times quoted him as saying: \u201cI am not a leader or an active participant of any criminal group.\u201d When the BBC asked him about the YBM Magnex case in 1999, he said: \u201cWell, if they found old-fashioned hanky-panky, it’s up to them to prove it.\u201d<\/p>\n

Frankel, Knight and Dijkhuizen also could not be reached for this story. In an email, Del Valle said he could not comment. Chac\u00f3n Rossell\u2019s attorney said her client declined comment.<\/p>\n","protected":false},"excerpt":{"rendered":"

Meet some of the convicted felons and alleged wrongdoers who use secretive offshore companies found in the Panama Papers database.<\/p>\n","protected":false},"author":2,"featured_media":22542,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[2],"tags":[],"class_list":["post-4472","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stories"],"acf":[],"_links":{"self":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/4472","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/comments?post=4472"}],"version-history":[{"count":1,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/4472\/revisions"}],"predecessor-version":[{"id":30739,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/4472\/revisions\/30739"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media\/22542"}],"wp:attachment":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media?parent=4472"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/categories?post=4472"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/tags?post=4472"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}