29/09/20

US: Panama Papers accountant gets three years.

As published on international-adviser.com, Monday 28 September, 2020.

A 76-year-old accountant has been sentenced to three years behind bars by a federal judge in New York.

Richard Gaffey previously pleaded guilty to eight counts; including conspiracy to commit tax evasion and defraud the United States.

According to the Securities and Exchange Commission (SEC), “since at least 2000 through 2018, Gaffey conspired with others to defraud the US by concealing his clients’ assets and investments, and the income generated by those assets and investments, from the IRS through fraudulent, deceitful, and dishonest means”.

“Gaffey helped those US taxpayers evade their tax reporting obligations in a variety of ways, including by hiding the beneficial ownership of his clients’ offshore shell companies and setting up bank accounts for those shell companies. These shell companies and bank accounts made investments totaling tens of millions of dollars.”

In addition to a jail term, he has also been ordered to pay $8.75m (£6.9m, €7.5m) in penalties.

Gaffey’s actions were described by prosecutors as a “calculated and prolonged effort” to mislead the US tax authority.

Given his age and the outbreak of coronavirus, Gaffey’s lawyer had requested that he serve his sentence under house arrest.

But the judge determined that a custodial sentence would act as a stronger deterrent to others.

Gaffey also faces three years of supervised release one his prison sentence ends.

More than 11.4 million documents were leaked from Panamanian law firm Mossack Fonseca and published in 2016 by the International Consortium of Investigative Journalists (ICIJ).

At the time, the Panama Papers leak was described as the “biggest ever blow” to the offshore world.