The fashion industry has had its fare share of tax evasion scandals over the past several years, and so, it is not terribly surprising that it is not immune from Panama Papers allegations. In fact, a week after a massive leak of some 11 million documents that rocked the world leaders with disclosures of offshore funds, tax evasion and money laundering, a number of publications, including Italian l'Espresso paper, are reporting that fashion figures on the list. Valentino Garavani, the founder of Italian design house Valentino, and his partner Giancarlo Giammetti, are linked to establishing two companies in the British Virgin Islands under the names of Jarra Overseas and Paramour Finance. London-based designer Roksanda Ilincic has also been linked with the tax scandal.
The U.S. Securities and Exchange Commission (SEC) will review the leaked "Panama Papers" exposing holders of thousands of hidden bank accounts for possible violations of anti-bribery law, said the head of the agency's unit that fights foreign corruption. Kara Novaco Brockmeyer, chief of the SEC's Foreign Corrupt Practices Act (FCPA) unit told the press this week that laundered money is a red flag that points to a wide range of illegal practices, the most obvious being narcotics and terrorism network financing.
It also plays a lesser-known but critical role in many cases of bribery and corruption involving public officials and corporations subject to SEC oversight under the FCPA. "There will be much for the SEC to review" in the massive leak of data, said Ratan Narnolia, senior manager of Crowe Horwath's anti-money laundering compliance consulting practice.
The U.S. Treasury Department intends to soon issue a long-delayed rule forcing banks to seek the identities of people behind shell-company account holders, after the "Panama Papers" leak provoked a global uproar over the hiding of wealth via offshore banking devices. A department spokesman said on Wednesday the rule would "soon" be turned over to the White House for review and issuance, but did not confirm any timetable for the initiative, which has taken years.
Governments around the globe have launched probes into possible financial wrongdoing after 11.5 million documents from the Panamanian law firm Mossack Fonseca, nicknamed the "Panama Papers," were leaked to the media. Mossak Fonseca has said it was the victim of a computer hack, and that it has consistently acted appropriately.