Zuma's nephew named in Panama Papers scandal

Khulubuse Zuma is reportedly linked to a company involved in a controversial oil deal in the DRC.

FILE: Khulubuse Zuma. Picture: AFP.

JOHANNESBURG - A prominent member of President Jacob Zuma's family has been named in the so-called Panama Papers scandal, which has seen 11 million records relating to offshore investments leaked to the media.

More than 11.5 million documents from the files of law firm Mossack Fonseca, based in the tax haven of Panama, reveal details of hundreds of thousands of clients in multiple jurisdictions.

Globally, 140 political figures, celebrities and business leaders have been implicated in the web of controversial investment schemes.

In the leaks, Zuma's nephew Khulubuse Zuma is linked to a company involved in a reportedly controversial multi-million rand oil deal in the Democratic Republic of the Congo.

The leak was shared with dozens of news organisations around the world.

"This is definitely going to lead to a massive change. They're basically taking money out of developing countries that should help to run these countries. We're talking billions of dollars here and there's a massive rising tide against it. A lot of it is actually not illegal, it's just unethical," International Centre for Journalists' Chris Roper explained.

Khulubuse Zuma is yet to respond to the allegations.

Meanwhile, tax authorities in Australia and New Zealand are probing local clients at Mossack Fonseca.

The leaked Panama Papers cover a period over almost 40 years, from 1977 until as recently as last December, and allegedly show that some companies domiciled in tax havens were being used for suspected money laundering, arms and drug deals, and tax evasion.

Britain's Guardian newspaper said the documents showed a network of secret offshore deals and loans worth $2 billion led to close friends of Russian President Vladimir Putin. Reuters couldn't independently confirm those details.

The Australian Tax Office (ATO) said on Monday it is investigating more than 800 wealthy clients of Mossack Fonseca.

"Currently we have identified over 800 individual taxpayers and we have now linked over 120 of them to an associate offshore service provider located in Hong Kong."

DATABASE "HACK"

The head of Mossack Fonseca has denied any wrongdoing but acknowledged his firm had suffered a successful but "limited" hack on its database.

The firm's director, Ramon Fonseca, described the hack and leak as "an international campaign against privacy".

Fonseca, who was up until March a senior government official in Panama, said in a telephone interview with Reuters on Sunday the firm, which specialises in setting up offshore companies, has formed more than 240,000 such companies and noted the "vast majority" of these have been used for "legitimate purposes".

The 800 individuals under investigation include some taxpayers who had previously been investigated and others who had reported themselves to the tax office under a voluntary disclosure initiative, which allowed people to come forward and avoid steep penalties and criminal charges and has since ended.

Separately, media reports said the leaked data pointed to a link between a member of global soccer body Fifa's ethics committee and a Uruguayan soccer official who was arrested last year as part of a wide-ranging US probe into corruption in the sport.

Fifa's ethics committee said in a statement on Sunday that Juan Pedro Damiani, a member of the committee's judgment chamber, was being investigated over a possible business relationship with fellow Uruguayan Eugenio Figueredo, one of the soccer officials arrested in Zurich last year.

Damiani told Reuters in Montevideo on Sunday that he broke off relations with Figueredo when the latter was accused of corruption.

Additional reporting by Reuters.