Panama Papers

Wednesday 18 May 2016

By Michael Nudd, Global Chief Risk Officer


The Panama Papers have caused quite a stir in the global press with eye catching headlines focusing on the alleged corruption and criminality of politicians and celebrities using ‘tax havens’ to hide their wealth and avoid paying taxes. At the centre of the firestorm is a Panama based law firm, which had millions of confidential documents leaked from its database and passed on to the International Consortium of Investigative Journalists.

Two key issues have been raised by the Panama Papers – firstly the critical importance of robust and effective information security systems and secondly the illegal activity allegedly being carried out or facilitated by the organisation under scrutiny.  As a result of this we thought it would be useful to emphasise a few important facts about our business.

At Equiom we build relationships based on trust.

Equiom is licensed for the provision of trust and corporate services in jurisdictions which are known for their high standards of regulation, their support of international tax transparency and for their efforts in preventing financial crime.  We have open and honest relationships with each of our regulators and we are in frequent communication with them about our business. As part of the regulatory oversight of our business we are subject to regular regulatory visits and reporting requirements.

We take the time to thoroughly understand and build trusted, long-term partnerships with our clients, intermediaries and local governments and regulators with whom we faithfully comply. We work hard to understand our clients’ needs and attitude to risk and formulate appropriate investment strategies across all asset classes. We are also mindful of external forces and work with our clients to restructure where appropriate.

In the current climate this detailed process remains under regular review, ensuring clients’ objectives and expectations are met. We understand that our clients work with a broad range of advisers across multiple jurisdictions and lately have seen a significant increase in clients engaging with us to undertake a ‘Jurisdictional Healthcheck’ with the aim of protecting their wealth and fulfilling their ongoing compliance with regulatory and legal requirements.

Information Security

At Equiom, we take the security of client information and confidential documents extremely seriously.  We are fully compliant with local data protection legislation in the jurisdictions in which we operate and we have appropriate safeguards in place to prevent unauthorised access or unlawful use of confidential documents.  These include, but are not limited to:

  • Security policies, processes and management controls
  • Risk Register including a regular review/update process
  • Incident Response Plan with regular testing
  • Physical and logical security
  • Regular vulnerability scanning, penetration testing and social engineering testing undertaken by a trusted and qualified external third party
  • Fully managed 24/7/365 network intruder detection and prevention systems
  • Malware protection
  • Fully managed 24/7/365 email security
  • Website security
  • Mobile device encryption and security
  • Remote systems’ access encryption and security
  • Locking of USB ports, encryption of data transferred to a USB drive

Equiom prides itself on protecting the things you prize. This includes everything you entrust to our care and of upmost importance to us is your personal information.

Financial Crime Prevention

Preventing financial crime is of primary importance to Equiom and we operate in accordance with the relevant local and international standards for anti-money laundering and countering the financing of terrorism. 

Our procedures are designed so that Equiom only enters into relationships with clients of known provenance and integrity, involving legitimate business activities. We have procedures in place to minimise the risk of our services being used to for criminal activity including tax evasion.

On the subject of tax evasion prevention, we recommend that all of our prospective clients obtain tax advice specific to the Equiom services requested and their personal tax position. Equiom is fortunate to have Equiom Solutions, an in-house team of tax and VAT technical specialists, working alongside our client relationship teams. Tax advice can be provided either by Equiom Solutions or an external tax adviser. All advice received from external providers is reviewed by our specialist team. Equiom Solutions ensures that we understand the legitimate rationale for the provision of our services and does not promote the use of tax planning schemes.

Across the Equiom Group, the controls we have in place to protect our business include:

  • The appointment of experienced Money Laundering Reporting Officers, in each jurisdiction, with the relevant expertise to assist and advise the business on anti-money laundering matters and financial crime prevention generally
  • Policies and procedures addressing information security, anti money laundering and preventing the financing of terrorism, anti-bribery and corruption and politically exposed persons (PEPs)
  • Stringent client take on procedures managed by our dedicated Client On-Boarding Team with independent sign-off by our Compliance & Operational Risk functions
  • Ongoing risk assessments of our business and our clients to determine where vulnerabilities may exist for money laundering, terrorist financing and other criminal activity
  • Identification and verification of the identity of our clients including the ultimate beneficial owner
  • The screening of prospective and existing clients and, where appropriate, their associated parties, against sanction lists issued by US, UK, EU, UN and any local sanction lists issued by the jurisdictions in which we operate
  • The screening of prospective and existing clients and their associated parties against World-Check, a leading intelligence database
  • Enhanced due diligence on higher risk clients, including those who are regarded as PEPs. This includes politicians, their families and close associates
  • Regular training sessions to ensure our staff are aware of the latest trends in financial crime, money laundering and terrorist financing techniques, including the vulnerabilities of the services we provide

Protecting the things you prize.

At Equiom our independence allows for strategic thinking, proactivity and quick responses. This flexibility, combined with our multi-jurisdictional reach and deep understanding of the market allows us to capitalise on the benefits of some of the world’s leading international financial centres.

By giving you a brief insight into the lengths we go to in order to protect you and our business from the issues raised by the events in Panama, we hope to retain your trust in Equiom. Our team is on hand to discuss any concerns you may have in relation to the above, or if you have structures which you feel may benefit from a review.