One of the prime minister’s sons, Mohd Nazifuddin Mohd Najib, is among those named in a massive leak of information from a Panama-based law firm.
According to the documents uncovered in the leak, he had held directorships in two companies based in the British Virgin Islands (BVI), namely Jay Marriot International and PCJ International Venture Limited.
However, this does not imply any wrongdoing on his part.
“There are legitimate uses for offshore companies, foundations and trusts,” said the International Consortium of Investigative Journalists (ICIJ), which led the investigation together with Germany-based newspaper Süddeutsche Zeitung .
“We do not intend to suggest or imply that any persons, companies or other entities included in the ICIJ Power Players interactive application have broken the law or otherwise acted improperly,” it said.
According to the ICIJ, Nazifuddin became one of two directors of Jay Marriot in 2009.
The other director was reportedly Ch’ng Soon Sen, who was reportedly then the executive director of the property developer Malaysia Pacific Corp and is now its CEO.
The ICIJ report also noted responses to the leaks from Nazifuddin and Ch’ng.
Ch'ng reportedly confirmed acquiring Jay Marriot together with Nazifuddin in 2009, but there had been no business activity “since formation”.
In addition, he said Nazifuddin has transferred his shares in Jay Marriot to Ch'ng's sister and resigned in 2011.
As for PCJ International, Nazifuddin reportedly set up the company together with developer Megat Daniff Shahriman Zaharudin, but the company was shut down a year later.
The report also notes that Megat Daniff is a financial adviser of the NGO Youth on Unity, which is headed by Nazifuddin.
Nazifuddin reportedly told the ICIJ and Süddeutsche Zeitung that PCJ International was set up for conducting international business, but there had been no business transactions and the company was subsequently shut down.
Both companies had been registered in the BVI by the law firm Mossack Fonseca, where an employee supposedly leaked the documents to Süddeutsche Zeitung .
Largest data leak
It has been described the largest data leak that journalists ever worked with, comprising 2.6 terrabytes of data, 11.5 million documents, that shed light on 214,000 shell companies.
It reportedly took the combined efforts of 370 journalists in 78 countries to sift through the documents, dubbed the ‘Panama Papers’.
Offshore companies such as those in the BVI, Cayman Islands and Delaware, USA, are notoriously secretive due to opaque tax and corporate laws in these jurisdictions. For this reason, its use has been controversial.
Apart from legitimate business transactions, such shell companies had also been used for illegitimate purposes such as money laundering and tax evasion.
The BBC , which is among the news organisations that sifted through the data, had reported that the documents expose a money-laundering ring involving Russian President Vladimir Putin’s associates and Bank Rossiya, the latter of which is the subject of US and EU economic sanctions.