By: Brezhnev Malaba
A massive leak of 11,5 million legal documents, dubbed the Panama Papers, has revealed how the super rich of the world have devised an intricate web of offshore havens to hide their wealth – not just from the taxman but also from their spouses.
Assets worth billions of dollars are registered under trust funds and companies in offshore jurisdictions, to keep them beyond the sight of prying spouses who never hesitate to claim a share of the property during divorce proceedings.
The first tranche of documents leaked from the world’s fourth largest offshore law firm, the Panama-based Mossack Fonseca, has been obtained by the International Consortium of Investigative Journalists.
The treasure trove of files is casting new light on a Zimbabwean-born aviation tycoon Clive Joy-Morancho, 57, who is currently locked in long-running battles with his former wife, Nichola Joy, 49.
Nichola, whose five-year marriage to Joy-Morancho produced three children, is frantically seeking to be granted assets worth $40Â million as part of a divorce payout. The couple separated in 2011.
Joy-Morancho, who spends most of his time in Spain, France and the Caribbean, has refused to hand over the property, arguing that it was registered under offshore trust funds long before he married Nichola. He argues that therefore the assets cannot be considered marital property.
At the centre of the dispute are two London mansions, a private aircraft, a six-bedroom French mansion, a luxury Caribbean villa and a plot of land in a Swiss ski village.
The recently leaked files show that the Zimbabwean-born magnate has been a client of the law firm since 1997. There are hundreds of emails and files on his business dealings and evidence that he has paid the law firm thousands of dollars to contest his ex-wife’s claim.
In late 2014, an English High Court judge, Sir Peter Singer, ruled that Nichola could not be granted a share of the couple’s 35-car collection after Joy-Morancho proved to the court that all the cars – including a Bentley, a Ferrari and two McLarens – were registered under a trust. The vintage collection is worth more than $25Â million.
Although the judge blasted Joy-Morancho’s asset-concealment tactics, the court could not grant his ex-wife even a single car, since the vehicles were not registered in his name.
The judge described the tycoon’s methods of hiding assets from his ex-wife as “a rotten edifice founded on concealment and misrepresentation and therefore a sham, a charade, bogus, spurious and contrived”.
The Zimbabwean-born tycoon’s case is not unique. There is a growing trend of the super rich protecting their assets using offshore havens to make it near-impossible for their spouses to walk away with valuables in the event of divorce.
Mansions, luxury cars, yachts, art collections and company shares are registered under a web of secret trust funds. Spouses face costly legal battles to prove ownership of offshore assets in lengthy divorce proceedings.
Nichola, who complains that her battle to win her share of the marital assets is very expensive, says when she got married she had no idea how tricky the secret “trust funds” would turn out to be.
“I was naive, innocent of what trust fund meant when I married him. The problem is that the cost to fight this injustice precludes me and my ex knows it. The law has to change, these offshore trusts make a mockery of justice,” Nichola says.
The International Consortium of Investigative Journalists notes that a judge will have to eventually decide what proportion of the original $40 million claim can be granted to Nichola. But with an intricate web of “trust funds” and front companies obstructing her path, it is a tall order.-African Independent
