The Massachusettian accountant who worked in tandem with Mossack Fonseca, the defunct Panamanian law firm, has pled guilty to wire and tax fraud, money laundering, aggravated identity theft and four counts of wilful failure to send Reports of Foreign Bank and Financial Accounts to the US Financial Crimes Enforcement Network.

Richard Gaffey, 75, of Medfield in Massachusetts, worked with Mossack Fonseca to create shell companies and defraud the US Internal Revenue Service of millions of dollars over decades. He went to extraordinary lengths to do this, with the aim of maintaining the wealth of Harald Joachim von der Goltz, whose accountant he was, and that of others.

Gaffey helped various US taxpayers evade their tax reporting obligations in a variety of ways, hiding the beneficial ownership of his clients’ offshore shell companies and setting up bank accounts for those shell companies. Tens of millions of dollars evaded the IRS. Gaffey advised one taxpayer to covertly repatriate approximately US$3 million to the United States by reporting to the IRS a fictitious company sale. Ramses Owens, a Panamanian lawyer who worked at Mossack Fonseca, helped him. Owens is still on the run.

Gaffey falsely claimed that von der Goltz’s elderly mother was the sole beneficial owner of the shell companies and bank accounts at issue because, at all relevant times, she was a Guatemalan citizen and resident, and – unlike von der Goltz – was not a US taxpayer. In support of this pretence, Gaffey submitted the name, date of birth, government passport number and address of the old lady to a US bank in Manhattan. He is to be sentenced on 29 June.  Von der Goltz is to be sentenced on 24 June.