Raising concerns about possible ethics violations and corruption, the Paradise Papers revealed two top members of the Trump administration, Commerce Secretary Wilbur Ross and Secretary of State Rex Tillerson, have ties to tax havens, and that during Ross’s confirmation hearing, he failed to disclose business dealings with Russians who are directly connected to Russian President Vladimir Putin.
The Paradise Papers are a trove of more than 13 million leaked documents, published Sunday, detailing tax avoidance and shady deals among some of the world’s richest individuals and multinational companies. The documents include decades of corporate records from the offshore law firm Appleby. They were obtained by a German newspaper and shared with journalists associated with the International Consortium of Investigative Journalists (ICIJ) and other media organizations.
The files show that while Tillerson, the former CEO of fossil fuel giant ExxonMobil, directed a Bermuda-based joint venture that conducted gas and oil operations in Yemen, Ross still holds stake in a shipping company that is partially owned by Putin’s son-in-law and “a Russian tycoon sanctioned by the U.S. Treasury Department as a member of Putin’s inner circle.”
The revelations have raised concerns among lawmakers and ethics experts.
The watchdog group Common Cause has called on the Commerce Department’s inspector general to launch a full investigation into Ross’s offshore investments. The group’s president Karen Hobert Flynn said Monday, “These latest revelations are part of a disturbing pattern of Trump administration officials seeking to hide their links to Russian business interests and members of Vladimir Putin’s inner circle.”
The records and related reports come less than a week after it was revealed that the first federal charges were filed in the ongoing investigation into whether the Trump administration colluded with the Russian government to influence the 2016 presidential election.
Richard Painter, who served as the ethics chief under former President George W. Bush and is currently vice chairman of Citizens for Responsibility and Ethics in Washington (CREW), said, “It’s a very, very troubling situation.”
In an episode of the Center for Investigative Reporting’s Reveal podcast published Sunday, Painter explained, “If United States government officials have offshore entities, it may be very difficult to detect payments from foreign governments or sovereign wealth funds, and profits from dealings with those entities that are a violation of the Constitution.”
“We want good relations with China and Russia,” Painter added, “but we don’t want our senior government officials dealing with large companies in those other countries at the same time as they’re holding positions of trust in the United States government.”
Rex Tillerson, Secretary of State
In the late 1990s, before rising to the position of CEO, Tillerson served as president of Exxon Yemen as well as director of Marib Upstream Services Company, which was incorporated in Bermuda in 1997. Marib Upstream Services’ partners included the state-owned Yemen Gas Company and a company owned by ExxonMobil and the Texas-based Hunt Oil, which was run by Tillerson’s close friend Ray Hunt.
The Guardian, which received access to the records, reports ExxonMobil and Hunt Oil “ran a $5bn venture to export 61m barrels of natural gas a year from fields in Marib, western Yemen. Hunt had discovered the fields in the mid-1980s and brought in ExxonMobil to help develop them.”
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