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Finnish criminals identified in Pandora papers data leak

More than 200 Finnish citizens were named in the largest data leak in history, 20 of whom have criminal convictions.

An employee of a company called SFM wrote "our client" beside a photograph of convicted murderer Markus Pönkä. Image: Yle MOT / ICIJ

The Pandora papers — reportedly the largest data leak in history — have revealed that about 20 Finnish criminals acquired tax haven companies between 1996 and 2020.

The names of more than 200 Finnish citizens appear in the leaked papers.

Some 22 also had overdue debts of more than 50,000 euros, with the total amount of these liabilities amounting to almost 20 million euros.

Career criminal on the run

One of Finland's most wanted men, Tuomo Ahonen, is a prime example of how criminals have exploited the use of tax haven-based companies.

Ahonen is considered by police to be a career criminal, as he has been convicted of a number of serious financial crimes and is currently facing a further charge of money laundering.

Authorities believe Ahonen is currently in Spain, as he is trying to evade arrest.

"Ahonen is not currently in state custody," special prosecutor Johanna Hakanen confirmed to Yle's investigative journalism unit MOT.

The Pandora papers revealed that Ahonen set up a tax haven company called Phoenix Black Fire Limited in the Central American country of Belize in 2014 while on the run. The papers did not have any account information for the company, so how the money was used remains unclear.

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Finland's National Bureau of Investigation (NBI) believe Tuomo Ahonen may be hiding out in southern Spain. Image: Keskusrikospoliisi

"We are certainly interested to know the name of the tax haven company," Hakanen said.

Ahonen was apprehended by authorities in 2018 but he escaped before facing the money laundering charge. His case was further complicated by the fact that he had been extradited from Spain to Finland to face the charge.

"Since Ahonen had been extradited from Spain to Finland, his freedom could not be restricted under the same conditions as if he had been caught in Finland," Hakanen explained.

To facilitate his escape, Ahonen raised and used money in a way that has led to new financial crime charges.

"Money was recycled through bank accounts opened across Europe. The money is still missing," Hakanen said.

Ahonen currently has foreclosure debts in Finland of an estimated nine million euros, and his case demonstrates why criminals like to use tax havens.

Companies set up within a day

Ahonen's Belizean tax haven company was set up by a service provider called AABOL, which boasts that it can establish such companies in less than a day.

Checking the clients' background is a superficial part of the process, even though money laundering regulations state that backgrounds and the origin of the money should be carefully checked.

Ahonen set up his company by using an offer called the "Ultra Protection Package," a service in which the real owner of the company is encrypted using a decoy, and Ahonen's name was not entered in the shareholder register.

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Ahonen chose the "Ultra Protection Package" model from the service provider, which helps to conceal the real owner of the company. Image: Yle MOT / ICIJ

There are no indications from the data leak that AABOL carried out any checks into Ahonen's background. In a reply sent to the International Consortium of Investigative Journalists (ICIJ) — the body which received the data trove — AABOL said it cannot comment on the cases of individual clients.

The company further denied ignoring anti-money laundering legislation and added that it is reviewing clients' backgrounds.

Lack of international cooperation

The Director General of Finland's National Enforcement Authority, Juhani Toukola, told MOT that he is not surprised Finnish criminals are involved with tax haven companies.

"The phenomenon of trying to conceal criminal proceeds with the help of tax haven companies is well known. These cases are encountered every now and then," Toukola said.

Hiding assets or property abroad is often an effective way of avoiding detection, Toukola added, as cooperation between law enforcement authorities in different countries is still somewhat limited.

This is explained, he said, by the fact that European countries often have very different laws on this issue.

"A Finnish debtor could even own a castle in France, but we cannot access it. In these situations, it is the creditor's own responsibility to try to recover the debts and hire a local lawyer, for example," Toukola said.

The situation is easier if the case also involves a preliminary investigation by police, such as a suspicion of criminal activity on the part of the debtor.

"The police have well-established procedures, effective international cooperation and property can be confiscated in criminal cases," he added.

Finnish police follow the money

Criminal investigations involving tax haven companies do come to the attention of the National Bureau of Investigation (NBI) at regular intervals but, according to detective Tomi Taskila, these are usually cases where significant criminal activity is suspected.

The NBI makes about a dozen international requests for official assistance about tax haven companies each year.

"We usually follow the money, that is, we trace the proceeds of crime and at the same time, of course, we gather evidence for the case under investigation," Taskila explained.

The work is slow, he added, citing that a "quick response" to an international request for assistance usually means waiting about a year.

In addition, it can happen that crucial information, such as bank statements, cannot be shared internationally under any circumstances.

"But this really varies a lot. For example, we have received good information from Panama and Jersey recently," Taskila said.

MOT's investigation found that Finnish police even occasionally have difficulty obtaining official assistance from EU countries, such as Cyprus. The Mediterranean island country is a tax haven, and is especially popular with Russian citizens.

For criminals, the police's slow access to information is an advantage, as it makes it easier to conceal the criminal origin of the money, via money laundering.

One of the people named in the data leak is an Estonian citizen who is a suspect in the largest money laundering case in Finnish history. The Court of Appeal is expected to deliver a verdict on that case in December.

Tax havens are especially beneficial to criminals because the real owners of the companies are difficult to identify. Furthermore, companies that sell tax haven services often do not carry out extensive checks into their clients' backgrounds.

MOT asked Taskila for his view on a system where a criminal convicted of financial crimes and wanted in their home country can set up a company at high speed and get a bank account.

"There is a lot of injustice in the world. It could also be possible to address these situations in the target countries on the basis of anti-money laundering regulations, at least within the EU," Taskila responded.

Anti-immigrant agitator set up Seychelles company

In 2013, Ilja Janitskin — the founder of anti-immigration websites MV-lehti and Uber Uutiset — established a tax haven company in the Seychelles.

At the time the company was founded, Janitskin lived in Barcelona.

The Pandora papers data leak does not contain Janitskin's company statements or other documents that would show how much money the company had.

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Ilja Janitskin, who ran the anti-immigration websites MV-lehti and Uber Uutiset, died in 2020. Image: Mikko Koski / Yle

In 2018, Janitskin was found guilty of 16 criminal charges related to his websites and handed a prison sentence of one year and 10 months.

He appealed the verdict to the Court of Appeal, but before the court reached a decision, Janitskin passed away in 2020 at the age of 42.

Convicted murderer applied for tax haven company

The criminal records of the Finnish tax haven clients is quite diverse: financial crimes, assaults, drug and firearms crimes, and child sexual abuse.

However, one of them has a particularly notable criminal history. Markus Pönkä was convicted of murder in Tallinn in 2007, and he has also committed a series of fraud and financial crimes in Finland.

In August 2016, Pönkä asked a company called SFM that sells tax haven services to set up a company in Belize.

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Markus Pönkä. Image: Keskusrikospoliisi / Lehtikuva

An SFM employee used the Google Translate tool to translate a Finnish language article by commercial broadcaster MTV News which stated that Pönkä had been convicted of murder and served a long prison sentence, and that he was also facing a new charge related to the planned kidnapping of "a very rich person".

It is not clear from the Pandora papers if SFM eventually agreed to help Pönkä set up the company.

In a letter to the investigative journalism body ICIJ, SFM said it would carefully review clients' backgrounds and comply with the law in all its operations. SFM did not however wish to comment publicly on individual clients.

Yle's MOT unit was also unable to reach Pönkä for comment. In September 2020, Pönkä was extradited to Sweden, where he is suspected of a firearms crime.