Buenos Aires Times

economy HEARING IN CONGRESS ENDS IN FARCE

Caputo: “Offshore accounts are not a crime”

Finance minister appears before Congress to answer lawmakers on claims that he fronted offshore accounts for third parties. Caputo insisted he was not an owner of the companies in question, in a session overshadowed by a ‘papelito.’

Saturday 7 April, 2018
Finance Minister Luis Caputo answers questions from lawmakers.
Finance Minister Luis Caputo answers questions from lawmakers. Foto:TÉLAM/OSVALDO FANTON

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Finance Minister Luis Caputo addressed Congress on Wednesday over Argentina’s rising foreign debt and the scandal surrounding his personal financial activity in tax havens.

But the session where he was summoned to report on the state of the nation’s sovereign debt and to respond questions about his supposed ownership of offshore companies ended in scandal.

As senators and lawmakers from the government’s legislative coalition Cambiemos focussed on questions regarding debt financing and the tax deficit, the opposition honed in on Caputo’s participation in offshore firms.

The Finance minister was visibly frustrated at times, as lawmakers insisted on the tax haven scandal that has haunted him since early 2018.

“The smartest thing for me [to make money] would have been to stay in the private sector”, he said, insisting that having “offshore accounts is not a crime.”

Offshore accounts “are used for legal, safety reasons and it is a common practice,” he added, describing offshore accounts as “safety deposit boxes.”

Caputo said that he fronted offshore accounts for third parties but insisted he was not an owner of the companies in question.

Opposition lawmaker Agustín Rossi, the leader of the Kirchnerite caucus, claimed Caputo’s activities “might be legal” but formed part of different kind of “corruption.”

“You’ve just admitted that you’re a frontman. For whom?”, he charged. Caputo’s comments are consistent with the government’s position on the scandal.

Cabinet Chief Marcos Peña recently said: “He (Caputo) makes his country and the government proud; he gave up everything to come to Argentina”.

The session, which counted with members from both the Chamber of Deputies and the Senate, was part of the newly formed Bicameral Commission for the Control of Foreign Debt, and was presided over by José Mayans, a Peronist Senator from Formosa Province. Throughout the questioning, Mayans was forced to ask those present, particularly deputies, to respect the protocol, which includes not clapping or cutting off those who have the floor.

Members of both the ruling Cambiemos (Let’s Change) coalition and the opposition taunted each other, but the situation got out of hand when Caputo, responding to a previous accusation on a TV show by Kirchnerist Deputy Gabriela Cerutti, sent a note asking her to tone down her accusations against his daughters, aged 11 and 13, which he signed with a smily face.

Cerrutti exploded, claiming Caputo’s attitude was “disrespectful” and “machista.” Facing the outrage of the Kirchnerists, who didn’t respect Mayans’ calls to the order, the Session was called off.

A Perfil and La Nación investigation in February revealed Caputo failed to declare information about his stake in offshore companies that manage hundreds of millions of dollars in tax havens.

From August 2009 to July 2015, Caputo was the major shareholder of the Princess International Group based in the Cayman Islands. He held more than 75 percent of the company’s shares.

However, he failed to include this information in legally-required affidavits for the 2014 financial year, which were presented to Argentina’s Anti-Corruption Office (OA) when he became a public servant in December 2015. He also withheld information in 2016 regarding the 2015 financial year.

The omission of this kind of information is a crime in Argentina and is punishable with up to two years in prison.

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