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Mossack Fonseca's busy Hong Kong hub

Thursday, April 07, 2016 - 01:39

The law firm at the centre of the biggest leak in whistleblower history, Mossack Fonseca, hosts its busiest office in Hong Kong says the International Consortium of Investigative Journalists. As Sara Hemrajani reports, offshore companies incorporated in offices in China and Hong Kong make up 29 percent of the law firm's active companies worldwide.

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Appearances may be deceiving. Mossack Fonseca's unassuming office in Hong Kong is actually the firm's busiest. That's according to analysis of the 'Panama Papers' by the International Consortium of Investigative Journalists. The document leak allegedly shows that China is the Panamanian law firm's biggest market, making Hong Kong an important hub for incorporating offshore companies. SOUNDBITE: Francis Lun, Chief executive officer, GEO Securities, saying (English): "Hong Kong is in China, so it's very easy for a wealthy Chinese or for a politician to come to Hong Kong and set up everything." Legally every Chinese person can take $50,000 out of the country each year. But some of mainland's elite want to park their much more of their wealth overseas. Shuffling that money around often involves creating shell companies in places like the British Virgin Islands. SOUNDBITE: Francis Lun, Chief executive officer, GEO Securities, saying (English): "I heard that up to 50 percent of the BVI [British Virgin Island] companies that were sold worldwide were bought by Chinese nationals." Owning offshore companies isn't illegal in China but the revelation comes at a tricky time for Beijing. The country's leadership, including relatives of President Xi Jinping, have been named in the documents. Xi has been trying to stamp out corruption since he came to power three years ago -- Communist Party officials aren't supposed to profit from their positions. So far Beijing has said it won't comment on what it calls "groundless accusations". While Mossack Fonseca Hong Kong says it's never been charged with or formally investigated for criminal wrongdoing.

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Mossack Fonseca's busy Hong Kong hub

Thursday, April 07, 2016 - 01:39