The release of a massive report on the secret financial dealings of hundreds of world leaders, powerful politicians, billionaires, celebrities, religious leaders and others, names at hundreds of Israelis as being less than upfront about their financial practices.
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The so-called "Pandora Papers," released Sunday by the International Consortium of Investigative Journalists, involved investigations by 600 journalists from 150 media outlets in 117 countries.
According to financial daily Globes, the report names 565 Israelis, making Israel the 16th most cited country in the Pandora Papers, among them former Jerusalem Mayor Likud MK Nir Barkat, former Labor party Justice Minister Haim Ramon, and diamond magnate Beny Steinmetz, who earlier this year was convicted of bribery in a Geneva court.
The report alleged that when Barkat, who holds a stake in social trading capital market platform eToro, registered in the Virgin Islands, was the mayor of Jerusalem, he failed to transfer the shares to a trustee, as required under Israeli law. Later, when was elected to the Knesset in 2019, he transferred the shares to his brother rather than to a third party, despite the fact that the guidelines of the Knesset Ethics Committee bar naming a relative as the trustee of financial assets.
A statement by Barkat's spokesperson said, "Nir Barkat has not been involved in business affairs since he was elected as a public representative. His shares are held by a trustee meaning that he takes no part and no involvement in matters regarding these shares – in global tech companies, and on more than one occasion he has been required by the international authorities to confirm technical details regarding his identity as one of the shareholders."
The statement went on to say that "Barkat is a pioneer in high-tech in Israel and is proud to be a partner in the establishment of companies that have become a national and global source of Israeli pride.
"Nir Barkat is proud of the fact that he has always paid his taxes in full in Israel and in all his public roles he has worked for annual wages of 1 shekel. Upon entering public life 18 years ago, he transferred the management of all his business to his brother, and upon his election to the Knesset he submitted all necessary documents to the Ethics Committee and asked for its instructions.
"It should be noted that the law allows an MK to place assets in a blind trust run by a relative who was once a business partner," the statement continued. "It is difficult to disregard the political interests at play in this ridiculous 'report,' given that Barkat has emerged as one of the leaders who can bring Likud back to power."
Former Minister of Justice Haim Ramon's business dealings with Austrian billionaire Martin Schlaff in Montenegro were also listed in the Pandora Papers, in connection to a dubious tourism real estate deal.
The allegations revolve around the "Bigova Bay" company set up in 2006, with a 20 million euro loan from an Austrian bank, to set up a tourism project in Montenegro. The report alleged that the deal made little financial sense, given the company's debt, lack of progress and a clause that allows Schlaff to buy it back.
Ramon's slammed the allegations, saying, "I strongly reject the claim that I was a front man of the MS Privatstiftung [Schlaff's private foundation]. These accusations are harmful, hurtful, and not true." He added that he was "merely working to extract the 'Bigova Bay' project from the dead-end in which it has been mired."
Schlaff's office said that Ramon was selected to help "Bigova Bay" "over his extensive business experience and ties," adding that he "has been able to make significant progress."
The Pandora Papers went on to accuse Steinmetz of setting up "a complex financial web," including a series of shell companies, to pay bribes so that the his company, Beny Steinmetz Group Resources could obtain mining permits in Guinea's southeastern Simandou region.
The area is estimated to contain the world's biggest untapped iron ore deposits.
According to the report, in 2018 Steinmetz, which at the time was waging a legal battle in Geneva, decided to transfer about $1 billion from a Lichtenstein-based fund, to one in the Cook Islands, citing that he was "unhappy" with the performance of the fund.
The Pandora Papers expansive, porting through nearly 3 terabytes of data – the equivalent of roughly 750,000 photos on a smartphone – leaked from 14 different service providers doing business in 38 different jurisdictions in the world. The records date back to the 1970s, but most of the files span from 1996 to 2020.
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