Russian audit chamber says it knows more about Russian offshore schemes than ICIJ

MOSCOW, April 4 /TASS/. The Russian Audit Chamber knows more about the grey offshore schemes of Russian business than the authors of an ICIJ (International Consortium of Investigative Journalists) report published on April 4, Oksana Dmitriyeva, a member of the Russian State Duma Committee for Budget and Taxes, said.

The Washington-based consortium published 11.5 million documents with information on offshore accounts of a number of incumbent and former world leaders. The publications are based on information leaks of the Panamanian company Mossack Fonseca, which renders legal assistance in the registration of companies in the offshore zones.

"There is no need for us to look through the Panama papers. The Audit Chamber has investigated lots of issues," Dmitriyeva told TASS.

The deputy said that the audits of the Rosnano state corporation revealed the transfer of funds from Rosnano Kapital, Rosnano’s sister fund, to the accounts of firms in Luxembourg and Switzerland.

"No Panama papers are needed to realize that the funds were just withdrawn offshore. Our Audit Chamber has checked all that," Dmitriyeva went on to say.

She called for bringing the investigation into all facts of withdrawing finance abroad to the end; initiate criminal proceedings and punish appropriate bureaucrats.

The IVIJ documents, which are open to access, contain materials revealing the criminal dealings of a number of prominent people, including Egypt’s former president Hosni Mubarak; Libya’s late leader Muammar Gaddafi; Syrian President Bashar al-Assad and Prime Minister of Iceland Sigmundur David Gunnlaugsson.

The report also says about a number of offshore deals struck by prominent Russian businessmen.

The creation of favorable business climate in Russia may be the best way to get rid of offshore zones, according to Anatoly Aksakov, the head of the Russian State Duma Committee for Economic Policy, Innovative Development and Entrepreneurship.

"The best way of fighting offshores is to create favorable conditions for business in this country," the deputy told TASS on Monday.

He enumerated a series of measures, which, in his view, would produce a favorable impact on the process of transferring offshore companies under the Russian jurisdiction.

"First, it is necessary to pass a law on supervisory activities, which will be sparing for business: first, it should be a warning; then there should be fines ranging from minimal penalties to huge ones for repeated offences," Aksakov went on to say.

He believes that favorable administrative conditions are also necessary for the normal development of business.

"Businessmen try to relocate their businesses offshore for fear of law enforcers who can take away their business. It should not be so. Law enforcers come [to companies] on anonymous statements and create an upheaval. Officials who initiate this practice should bear full responsibility up to disqualification. Then they will think prior to making such decisions [on a new raid] in future," Aksakov said adding that a reasonable tax burden on business could also contribute to de-offshorization.

"Taxes should be reasonable and stable and should not grow," the head of the State Duma Committee said.

He added that limited access to financial resources could be another favorable factor for de-offshorization. It should be more difficult for companies registered offshore to gain access to these resources.

"If a company is registered in Russia, it should have access to participation in state and municipal purchases. A company registered offshore should be banned from taking part in these procedures," the deputy said.

Aksakov said it was necessary to stimulate business with creating a favorable business climate but called for remembering the "carrot and stick" method. Businessmen who evade taxes should know they will face strict penalties for tax evasion.