Caribbean & Central America - May 2016 (ISSN 1741-4458)
PANAMA: Varela back on the defensive as another scandal breaks
The US designation this month of a group of Panama-based companies as a money laundering operation (Waked Money Laundering Organization, Waked MLO) and their heads, Nidal Ahmed Waked Hatum (Waked Hatum) and Abdul Mohamed Waked Fares (Waked Fares), as Specially Designated Narcotics Traffickers pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act) has dealt a further blow to President Juan Carlos Varela in his efforts to restore credibility in local institutions following the so-called ‘Panama Papers’ scandal [RC-16-04].
The designation by the US Department of the Treasury’s Office of Foreign Assets Control (Ofac) was announced on 5 May against the Waked family - one of Panama’s most important business groupings with interests in real estate, banks, media, retail and a re-export operation in the Colón free zone (ZLC). It came the day after Waked Hatum – described by the US Drug Enforcement Administration (DEA) as “one of the world’s biggest drug money launderers” - was arrested in Colombia on 4 May by local police, after being charged in the US’s Southern District of Florida with money laundering and bank fraud.
With the fall-out yet to become clear, the designation came at the end of a three- day visit to the US by President Varela aimed at providing fiscal transparency reassurances. Addressing the 46th Annual Washington Conference on the Americas, co-hosted by the US State Department and Council of the Americas, Varela said “Panama´s success does not depend on irregular flows of money into our financial system [but] is based on the hard work of the Panamanian people”. He pointed to recent moves like the establishment of a local panel of experts to look at working practices, and new tax information sharing deals such as an Intergovernmental Agreement (IGA) inked with the US last month to implement the Foreign Account Tax Compliance Act (Fatca) – the legal instrument for the automatic exchange of financial information between both countries.
- Waked
Led by Panamanian-Colombian-Spanish national Waked Hatum and Panamanian-Lebanese-Colombian national Waked Fares, the operation reportedly used 68 companies including: Grupo Wisa, a holding company for businesses involved in real estate, construction, retail, hospitality, and media (including two Panamanian national dailies, La Estrella and El Siglo); Vida Panama (an import/export company in the Colón free zone [ZLC]); and Balboa Bank & Trust.