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Are shell companies a compliance nightmare?

Paul Hodgson | May 9, 2017

On the anniversary of the Panama Papers, human rights campaigner Global Witness put out a press release linking one of the largest privatisations in history—the sale of almost 20 percent of Russian oil giant Rosneft to a consortium led by FTSE 100 company Glencore—with allegations of Russian tampering in the 2016 U.S. election, Cayman Island shell companies, and the fact that Glencore companies have been reported to appear over 660 times in the Panama Papers themselves. That 660 is probably not a record, but an indication that the company—in common with so many others—uses shell companies to conduct its transactions. The fact that something is common practice and legal, however, does not make it best practice.

So, let’s start with the Rosneft transaction. A source with knowledge of the deal said that Glencore had disclosed as much about the deal as was possible, given the involvement of a number of Russian banks in the financing. That disclosure was, however, incomplete... To get the full story, subscribe now.