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The Panama Papers, a massive leak of documents on the world of offshore financing used frequently by many of the richest and most powerful around the globe, sheds light on the finances of Mexican businessman Juan Armando Hinojosa Cantú, described as Mexican President Enrique Peña Nieto’s “favorite contractor.”
The award-winning group said it obtained a cache of 11.5 million records from Mossack Fonseca–a law firm in Panama that is reportedly one of the world’s biggest creators of shell companies. The documents were originally given by an anonymous source to the German newspaper Süddeutsche Zeitung, which in turn shared them with ICIJ.
(Photo image: YouTube/ Angelica Rivera)
Hinojosa and other prominent Mexicans, mostly businessmen with close ties to the government, including at least one member of the Forbes billionaires list, were the subject of extensive articles published on line by Procesoand Aristegui NoticiasSunday to coincide with the ICIJ posting of the Panama Papers.
Proceso, Mexico’s leading weekly magazine, reported that Hinojosa, a wealthy entrepreneur whose company, Grupo Higa, won multimillion-dollar contracts from the State of Mexico when Peña Nieto was its governor, secretly shuffled $100 million through banks and shadow companies.
According to Proceso, Mossack Fonseca, in collaboration with the Mexican branch of the law firm D’Orleans & Bourbon Associates, helped Hinojosa and his wife set up a series of shell companies on behalf of family members—including their respective mothers who are in their 80s–in New Zealand. Hinojosa and his wife then “donated” millions of dollars to the shell companies, which acted as beneficiaries of a foundation in Holland.
The firms were aware that the $100 million was just a “small part” of Hinojosa’s wealth,Proceso reports. In July 2015, an advisor with D’Orleans, Bourbon & Associates in Miami, sent an “urgent” email message to a Olga Santini, director of Mossack Fonseca’s branch in Florida.
“Please note that we have been working together with the advisor of a very high profile client for some time and we envision that we will be appointed to assist in the restructure of his patrimonial vehicle outside his country of residence.
The structure would involve:
(1) Transfer of six (6) companies—four (4) BVI and two (2) Nevis from current provider (Trident);
(2) Appointment of nominee director & nominee shareholder for the above mentioned companies;
(3) Formation of three (3) NZ Trusts—which will be the beneficiaries of a Dutch foundation (STAK) and subsequent settlement of assets (portfolio accounts in four banks—JP Morgan, UBS, DB and MS—of circa USD 100M) owned by the before mentioned six (6) companies.
(4) Once the transfer is complete, dissolution of the six (6) companies,” reads the email.
A screen shot of the original document was published by Proceso.
The author of the memo, who Proceso identifies as Felipe Miguel Fernandes de Matos, though his name is crossed out, added: “This is only a small part of the client’s portfolio and we see great potential of (sic) growth as he is one of the most prominent business man (sic) in Mexico. Unfortunately due to his success and high profile, he has quiet (sic) a number of people whom greatly dislike him and unfortunately, there is a great deal of negative publicity surrounding the client.“
With the email, the author sent the first pages of Hinojosa’s and his wife’s Mexican passports, with the notation that they, “…would be the first beneficiaries of the trust (for which we ask that it remains of the upmost confidentiality…)” Proceso reproduced both diplomatic documents.
In 2014, Aristegui Noticias reported that Angelica Rivera, a former soap opera star and current wife of Mexican President Enrique Peña Nieto, bought a US $7 million mansion from Hinojosa in one of Mexico City’s upscale neighborhoods.
Facing mounting public protest, Peña Nieto ordered one of his hand-picked ministers to conduct an investigation, but the investigation found no evidence of wrongdoing by the President and or his wife.
According to Proceso, Hinojosa began transferring his wealth in March of 2015, a week after Peña Nieto ordered the investigation.
Mossack Fonseca issued a response to the ICIJ report stating that as a registered agent it is simply helping its clients incorporate companies and that the law firm conducts thorough due-diligence, “one that in every case meets and quite often exceeds all relevant local rules, regulations and standards to which we and others are bound.” (For Mossack Fonseca’s complete response, see here.)
Grupo Higa did not respond to Proceso’s requests for comment. This reporter was unable to contact Grupo Higa. Their website does not provide an email or phone number.
Paulo Careño King, a spokesperson for Peña Nieto, said the “story was a little old” and referred reporters to the government’s investigation exonerating the President and his wife.
Mexico’s Service of Tax Administration, the country’s equivalent of the IRS, said Monday that it would review the information on the Mexicans mentioned in the Panama Papers to determine if there was evidence of tax evasion.