Panama Papers case fallout: how Rob Galbraith helped save money for rich foreigners

Rob Galbraith, along with a partner and client, registered dozens of shell companies for the benefit of clients, with the understanding that he would collect the capital gains (or profit) when their portfolio appreciated….

Panama Papers case fallout: how Rob Galbraith helped save money for rich foreigners

Rob Galbraith, along with a partner and client, registered dozens of shell companies for the benefit of clients, with the understanding that he would collect the capital gains (or profit) when their portfolio appreciated. The partners would act as agents.

The Panama Papers caused Galbraith’s industry to fall apart.

A Swiss newspaper reported on Galbraith’s activities in 2015, and by 2016 he was banned by the Swiss Financial Market Supervisory Authority. In early 2017, the Swiss authorities charged Galbraith with tax evasion and fraud.

A Canadian tax court agreed and referred the case to a federal grand jury in Washington DC. Subsequently, it indicted Galbraith and his firm in New York in August 2018. Galbraith pleaded guilty, and Canadian court documents show he’s likely to serve prison time.

“This case demonstrates that Canada has turned a blind eye to the fact that numerous wealthy Canadians, including many who live here, use private financial and business entities to evade taxes,” says Richard Kersten, United States Immigration and Customs Enforcement special agent.

Galbraith’s fraudulent work is now part of one of the largest offshore-tax amnesty programs in US history. The Fair Tax Network says more than 700 clients have signed affidavits confessing to fraudulent tax schemes that should have triggered a Justice Department criminal investigation.

Almost 600 have resolved their cases using deferred prosecution agreements that will end once they pay back taxes, money laundering and criminal fines of up to $3m.

Though Galbraith’s activities in Canada were a pittance compared to his secret work in the US, where he helped hide $2.5bn from the IRS, he still triggered a revote of the Panama Papers payments, which lost more than $3m.

The number of Panama Papers related investigations is rising. French and US investigators are looking into a large amount of the following allegations: tax evasion by individuals, banks, and corporations; the manipulation of stock market prices to make sham financial transactions; secret offshore bank accounts; and tax and money laundering practices in the developing world.

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