Two Canadians say they’re in the Panama Papers for the right reason
A lawyer and wealth manager from Montreal appear hundreds of times in the Panama Papers, but they say they’re repatriating offshore funds back to Canada.
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Jules Brossard’s and Alain Roch’s fingerprints are all over the Panama Papers, but they say they are there for a good reason.
Between them, Brossard and Roch administer 84 companies registered with Mossack Fonseca, and are named personally as shareholders of all but one of them. Their signatures appear on hundreds of corporate documents and their passports are kept on file by the Panamanian law firm.
But these professional tax planners, who are so intimately acquainted with the offshore industry, said offshore corporations are “useless” to law-abiding Canadians.
“For Canadian taxpayers who wish to follow Canadian tax law to the letter, (which is the case for all our clients) ‘offshore’ companies are useless for holding assets,” wrote lawyer Martin Raymond, a partner at Brossard’s Montreal law firm, De Grandpré Chait.
In a world where an estimated $32 trillion is kept in tax havens, this is a distinctly minority position, especially for those in the financial industry, which has been encouraging the legal use of offshore corporations for years.
Hand in hand with the Montreal wealth management company Blue Bridge and its president, Roch, the lawyers at De Grandpré Chait say they have been working to unwind their clients’ complex offshore holdings, repatriate their assets and declare them to the Canada Revenue Agency.
Rather than enabling offshore tax avoidance, De Grandpré Chait and Blue Bridge say, they hold an intervention with their clients and persuade them to come clean and bring their wealth home.
In 2011, De Grandpré Chait inherited the companies listed in the Panama Papers from new clients who had set them up years before, Raymond wrote, and its lawyers took them on only to liquidate them.
This is a stated policy at Blue Bridge. “We require that these companies are liquidated or brought under Canadian laws if they cannot be liquidated (immediately),” Roch wrote in an email.
When asked why he refuses to work with offshore assets, Roch said the decision is both philosophical and administrative: “It’s our business model.”
A Torstar News Service and CBC/Radio-Canada analysis of the 11.5 million documents in the Mossack Fonseca database shows that more than half of the companies registered by De Grandpré Chait and Blue Bridge have indeed been shut down or transferred to Canada.
Before 2011, it wasn’t this way.
Documents in the Panama Papers database show De Grandpré Chait set up at least one offshore corporation in the British Virgin Islands through Mossack Fonseca in 2009.
“Sir, Mrs, I am a Tax Partner for the law firm De Grandpré Chait in Montreal, Canada,” reads an email sent by former partner Daniel Courteau to Mossack Fonseca on Aug. 20, 2008. “I have a client that I know for several years that would like to incorporate and organize a BVI corporation.”
After receiving a payment of $9,000, Mossack Fonseca registered Jopk Inc. in July 2009 with five nominee directors and the sole shareholder, “MF Foundation.” A bank account at Winterbotham bank in the Bahamas was set up for the anonymous corporation.
Nowhere on any public documents were the names of the real owners of the company, nor those of their Canadian lawyer at De Grandpré Chait.
“I had facilitated the establishment of the incorporated business through the person from Mossack Fonseca I met in 2003,” Courteau, who is no longer with De Grandpré Chait, wrote in an email to the Star. “A bank account was opened with a $9,000 deposit. As indicated, the family decided not to proceed and beyond this deposit, no further transactions were made.”
Raymond said he could find no record of the transaction.
He confirmed the firm received a delegation from Mossack Fonseca at De Grandpré Chait’s Montreal office on Nov. 3, 2003. According to minutes of the meeting in the Panama Papers database, De Grandpré Chait “used Barbados for clients carrying actual business outside Canada because of its treaty benefits.”
The meeting minutes also state that De Grandpré Chait had “to argue with Revenue Canada when working with jurisdictions other than Barbados and Switzerland. This is why they have oriented their tax planning practice for income derived outside Canada.”
Courteau said he does not “share all the conclusions in the summary of this meeting written by the representative of Mossack Fonseca.”
“We have no indication of any advice or assistance given by De Grandpré Chait to any Canadian clients regarding the setup of ‘offshore corporations’ for the purpose of hiding assets or income, whether through Mossack or other similar firms,” Raymond wrote in an email.
On paper, De Grandpré Chait is Mossack Fonseca’s third largest professional client in Canada. According to the Panama Papers database, the Montreal firm transferred 82 British Virgin Islands companies to Mossack Fonseca in 2011 and 2012.
When they took over the administration of the offshore companies, Brossard and Roch put their own names down as shareholders. Both men say they have no personal stake in the companies and explain that their names appear only as trustees of the trust funds that are the real owners of the company.
“At no time did any assets leave Canada to be transferred abroad in order to be held by one of these companies. Instead, from the moment Mr. Brossard and Mr. Roch became shareholders, all of these companies’ assets, regardless of their location, were considered to be the property of Canadian beneficial owners, and taxed in Canada on their revenues,” Raymond wrote.