Wyoming Launches Investigation Into Panama Papers Law Firm

by | April 7, 2016

By Trevor Brown

Wyoming has launched an investigation tied to the massive data leak of the so-called "Panama Papers" that has drawn headlines and sparked outrage around the world.

Secretary of State Ed Murray announced Wednesday that his office is probing the group serving as Wyoming's registered agent for Mossack Fonseca.

The Panamanian law firm prompted international scrutiny this week after millions of leaked documents exposed how the group helped wealthy individuals across the globe hide assets though shell companies.

The leak -- one of the largest ever of its kind -- has led to the resignation of Iceland's prime minister and accusations of corruption by many other prominent figures and world leaders.

Although shell companies are not illegal, they can be targets for money launderers, politicians hoping to avoid conflict-of-interest charges and other fraudulent operators because of the anonymity they offer.

For years, Wyoming has been considered a haven for shell companies because of the state's relatively lenient requirements and extra privacy protections. And even though legislative changes have been put in place since 2009 to strengthen the state's laws, Wyoming remains one of the most attractive locations in the country for these groups.

Murray said his office performed an audit of M.F. Corporate Services Wyoming LLC, which serves as the registered agent for Mossack Fonseca in Wyoming, following news of the leak.

A registered agent, which is a representative who can be served and handle legal documents on behalf of a company, can range from a firm representing thousands of clients to an attorney who might represent just a few.

The audit revealed 24 of the 214,488 entities mentioned in the leaked Panama Papers were registered with M.F. Corporate Services Wyoming LLC. It further showed that M.F. Corporate Services violated a state law that requires registered agents to maintain certain information with the state or at their office.

Will Dinneen, a spokesman with the Secretary of State's Office, didn't say specifically what part of the law was violated. But among the provisions in the state statute are requirements that registered agents maintain a physical address and keep the names and addresses of each entity's directors, officers, limited liability company managers, managing partners, trustees or persons serving in a similar capacity at the entity's registered office.

Failure to maintain the records, under state law, carries a penalty up to $500 per violation. But Dinneen didn't say what punishments, if any, were made.

A release from the Secretary of State's Office says M.F. Corporate Services eventually complied with a demand to provide the missing information.

But Dinneen said an internal investigation into this matter is ongoing. He added that Murray notified law enforcement of the developments.

Meanwhile, Murray pushed back against calls for federal changes to add transparency for registered agents and shell companies.

"I oppose a one-size-fits-all federal law mandating the dissolving of privacy protections, and assure the citizens of Wyoming that we will continue to fight fraud and, if there is a clear need to do so, address necessary changes to Wyoming statutes," he said in a statement. "We are not naive as to the importance of the release of these 'Panama Papers,' but we will not compromise the privacy of our customers."

He also noted that Wyoming has enacted several legislative changes since 2009 "to combat illicit activities while maintaining Wyoming's competitive business environment."

(c)2016 Wyoming Tribune-Eagle (Cheyenne, Wyo.)