“Pandora Papers”: The machinations of the “Wolf of Sofia”

The “Pandora Papers” show how criminals use shadow financial centers to cheat their victims out of hundreds of millions of euros. One example is the “Wolf of Sofia”, whose companies also killed Germans for their money.
Anna Klühspies, Nils Naber, Han Park, Timo Robben, Benedikt Strunz and Zita Zengerling, NDR
The Pandora Papers show that organized criminals are using mailbox companies on a large scale to defraud individuals across Europe. The damage done by the networks runs into the billions. In Germany, too, there are tens of thousands of victims of so-called forex fraudsters. Forex stands for Foreign Exchange, i.e. trading in foreign currencies.

The 86-year-old Siegfried Baer is one of the many German victims: “We saw a program on television that showed how much money can be made with it.” Therefore, he registered with an online platform and invested in cryptocurrencies. A “personal client advisor” from SafeMarkets explained in detail to Baer how to invest. “He took his time and asked about my family and how I was doing. He was really nice.”

The “Pandora Papers” are a huge data leak from the world of shadow financial centers. The data shed light on the real owners of more than 27,000 offshore companies. The data includes politicians, the super-rich, oligarchs, criminals and celebrities. The 11.9 million confidential records include letters of incorporation from letterbox companies and trusts, emails, accounts and other documents.

The data were analyzed in a secret research by more than 600 journalists and journalists from 117 countries. Media such as the “Washington Post”, the BBC, Radio France, the ORF, “El País” and “Aftenposten” were involved. In Germany, journalists from NDR, WDR and SZ researched the data leak.

The data set was leaked to the International Consortium for Investigative Journalists (ICIJ) from an anonymous source. The ICIJ shared the data with the partner media and coordinated the research. The ICIJ has conducted global research on shadow financial centers, including the Panama Papers, the Paradise Papers and the Luxembourg Leaks.

The confidential documents come from 14 offshore providers, i.e. from companies that help their customers to set up letterbox companies, trusts, etc. Often, letterbox companies are legally located in countries that are internationally noticeable due to weak money laundering controls, non-transparent financial practices and particularly low tax rates.

Owning a mailbox company is not illegal. Offshore firms can also be used for legal purposes. Often, however, such company structures serve money laundering, tax evasion or tax structuring.

The alleged specialists are fraudsters who are specially trained for their work and persuade their victims to invest more and more money. In fact, there is no trade in money. The “customer advisors” work in specially set up call centers in Bulgaria, Kosovo and Ukraine, among others. Up to 150 people can call from there, divided into departments that focus on different language areas. It is not uncommon for the same network to find victims in numerous countries around the world, including Germany.

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