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Paradise Papers | New ICIJ offshore trove reveals U2 frontman Bono used Malta company to buy Lithuanian supermarket

The Paradise Papers is a major new leak of documents from two offshore services firms based in Bermuda and Singapore, as well as from 19 corporate registries maintained by governments in secret offshore jurisdictions

matthew_vella
Matthew Vella
5 November 2017, 7:10pm
Paul Hewson, aka Bono, used a Malta company to buy shares in a Lithuanian supermarket
Paul Hewson, aka Bono, used a Malta company to buy shares in a Lithuanian supermarket
A new leak of offshore tax data has been launched by an international consortium of journalists, this time from a trove of documents related to Bermuda firm Appleby.

The Paradise Papers is a major new leak of documents from two offshore services firms based in Bermuda and Singapore, as well as from 19 corporate registries maintained by governments in secret offshore jurisdictions.

The documents were obtained by the Süddeutsche Zeitung and shared with the International Consortium of Investigative Journalists (ICIJ), which organized a collaborative investigation with dozens of outlets across the world, including the Organized Crime and Corruption Reporting Project (OCCRP).​

The data trove reveals that U2 frontman Bono, whose real name is Paul Hewson, was a co-director of the Maltese company Nude Estates, which bought the Aušra mall in Lithuania for €5.8 million shortly after it opened in 2007. Nude Estates incorporated a Lithuanian company of the same name to hold the property in Utena. In 2012, the shopping centre business was transferred to a company in Guernsey called Nude Estates 1.

For foreign investors, Malta allows tax paid by foreign shareholders to be discounted with an 85% rebate, rendering effective tax paid onprofits to 5%. In Guernsey, no tax is paid on company profits, although any money brought back into the UK or Ireland would be subject to tax.

READ MORE Malta 5% tax wipes off countries' tax earnings

MFSA chairman Joseph Bannister
MFSA chairman Joseph Bannister
Bono’s spokeswoman said the singer was a passive, minority investor in Nude Estates Malta Ltd, which was voluntarily wound up in 2015.

The new leak also reveal the Malta Financial Services Authority's outgoing chairman Joe Bannister's links to a Russian mining venture. 

In comments to The Times, Bannister played down his role in the venture, saying he was a non-executive director of one of its shareholders, ACP Special Situations No. 2 Limited. The emails show Russian mining company IMHL referring to Prof. Bannister as being part of “management” of ACP Special Situations No.2, which is domiciled in the British Virgin Islands.

Bannister said his involvement in ACP Special Situations pre-dates his appointment as MFSA chairman in 1999, and were cleared by the prime ministers he has served under. He said he resigned his role in the BVI-based company last year.

 

The Paradise Papers will also reveal the billions in tax refunds by the Isle of Man and Malta to the owners of private jets and luxury yachts.

The trove of 13.4 million records exposes ties between Russia and U.S. President Donald Trump’s billionaire commerce secretary, the secret dealings of Canadian Prime Minister Justin Trudeau’s chief fundraiser and the offshore interests of the queen of England and more than 120 politicians around the world.

ICIJ and its media partners will be publishing multiple stories in the coming days and weeks, including:
  • On Monday afternoon, stories on strategies used by multinational corporations to shift profits to low-tax jurisdictions; and a look into the world of private jets and yachts registered by wealthy owners in offshore tax havens;
  • On Tuesday afternoon, stories that look behind the huge offshore trust funds held by rich and powerful people; how prominent political donors in the U.S. make use of offshore financial structures; and reporting on tax haven shopping sprees by multinational companies in Africa and Asia that use shell companies in Mauritius;
  • And more to come on Wednesday, Thursday, Friday and into the next week.
  • ICIJ will also release the structured data connected to the Paradise Papers investigation in the coming weeks on its Offshore Leaks Database.


In addition to disclosures about politicians and corporations, the files reveal details about the financial lives of the rich and famous. They include Microsoft co-founder Paul Allen’s yacht and submarines, eBay founder Pierre Omidyar’s Cayman Island investment vehicle, and Madonna’s shares in a medical supplies company.

Last month, Bermuda's Appleby confirmed they received enquiries from the ICIJ about “documents that journalists claim to have seen and involve allegations made against our business and the business conducted by some of our clients,” confirming they had a “data security incident last year.”

The ICIJ which is most well known for their reporting on the ‘Panama Papers’ is a global network of more than 200 investigative journalists in 70 countries.

Appleby has offices in the key offshore jurisdictions of Bermuda, the British Virgin Islands, the Cayman Islands, Guernsey, the Isle of Man, Jersey, Mauritius, and the Seychelles, as well as a presence in the international financial centres of Hong Kong and Shanghai.

A spokesperson for the firm said the firm was not the subject of a leak but of an illegal computer hack.

matthew_vella
Matthew Vella is executive editor at MaltaToday.