How the Panama Papers Changed Pakistani Politics

This post was originally published on this site
https://static01.nyt.com/images/2017/07/29/world/29nawaz-panamapapers/29nawaz-panamapapers-moth.jpg

The Pakistani Supreme Court’s decision to dismiss Prime Minister Nawaz Sharif was based on corruption accusations stemming from the Panama Papers, a trove of leaked documents from the Panamanian law firm Mossack Fonseca.

The ruling is one of the most stunning outcomes of the documents’ release, which implicated dozens of politicians and powerful international figures in shady offshore business dealings. Mr. Sharif is the second world leader, along with Iceland’s former Prime Minister Sigmundur David Gunnlaugsson, to resign as a result of the leak.

What did the Panama Papers reveal?

Mr. Sharif’s name never appears in the Panama Papers, but three of his six children – Maryam Nawaz Sharif, Hasan Nawaz Sharif and Hussain Nawaz Sharif – were determined to have purchased luxury properties in London using offshore holdings. His children have maintained that the companies were set up with legally obtained money, but critics claim otherwise.

According to detailed reports from the International Consortium for Investigative Journalists (ICIJ), who first released the Panama Papers in early 2016 after a yearlong investigation, Mr. Sharif’s three children headed companies that owned four luxury flats in London’s Park Lane neighborhood.

His daughter Maryam, once seen as his likely political successor, was listed as the owner of two British Virgin Islands-based shell companies – Nielsen Enterprises Limited and Nescoll Limited – which were set up in the early 1990s, just after her father’s first term as prime minister ended. She was underage at the time. The companies owned “a U.K. property each” for use by the family of the owners, according to the documents.

Maryam and Hasan Nawaz Sharif signed paperwork in 2007 that was part of a series of transactions in which Deutsche Bank Geneva lent up to $13.8 million to the companies with their London properties as collateral. Hasan Nawaz Sharif was listed as the director of another British Virgin Islands registered company, Hangon Property Holdings Limited.

Another shareholder of that company transferred shares to him for about $11.2 million, according to the documents.

What happens next?

Mr. Sharif was not directly involved in the business interactions detailed in the documents, but was implicated in the scandal nonetheless. Throughout the Supreme Court hearing, he maintained that he was not involved.

Mr. Sharif’s case, and that of his children, will now go to Pakistan’s National Accountability Bureau for further investigation.

Lawyers for the country’s opposition told the court that because Maryam Sharif was underage at the time the business was set up under her name, the company would actually be owned by the prime minister. But that claim has not yet been confirmed.

This is not the first time that Mr. Sharif’s reputation has been tainted by allegations of corruption. His first term in office ended abruptly in 1993 when he was dismissed by then-President Ghulam Ishaq Khan over reports of mismanagement and corruption after his family business suddenly grew.

A second term in office in 1997 ended in a military coup. He came to office again in the elections of 2013.