Company
Background:
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| Illustration of Jurgen Mossack and Ramon Fonseca |
Mossack Fonseca is a Panamanian law firm that was founded
in 1977 by Jürgen Mossack and Ramon Fonseca. The law firm offers a wide range
of services to clients such as: shipping, immigration, contracts and
intellectual property, and commercial law in general (mossfon). Fox World News reported
about Mossack Fonseca’s background stating that, “It operates offices in
Belize, The Netherlands, Costa Rica, United Kingdom, Malta, Hong Kong, Cyprus,
British Virgin Islands, Bahamas, Panama, British Anguilla, Seychelles, Samoa,
and in three U.S. states.”
Ethics Case
Controversy:
Mossack Fonseca has been at the heart of offshore
services for years, as a matter of fact they are the fourth biggest provider of
these services. Setting up off shore firms is not illegal, it is however,
usually a secret world without much publicity. That is until an anonymous
hacker revealed for the world what has been dubbed the “Panama Papers.” The
anonymous source sent the files to the ICIJ, The International Consortium of
Investigative Journalists. It consists of 11.5 million documents involving
214,488 companies and 14,153 clients of Mossack Fonseca (foxnewsworld). Many of
the accounts leaked in the scandal belonged to current, as well as, former
world leaders, businessmen, celebrities, athletes, and drug kingpins. The
offshore accounts can be linked to over 200 countries and territories; some of
the political figures involved are from countries such as, Argentina, Iceland,
Pakistan, Ukraine, Saudi Arabia, and Russia (MSNBC). Many media outlets, like
the ICIJ, believe Mossack Fonseca were aware many of their clients were using
their accounts to launder money and evade taxes, but the firm simply looked the
other way. “A report from the ICIJ stated, the law firm has worked closely with
big banks and big law firms in places like The Netherlands, Mexico, the United
States, and Switzerland, helping clients move money or slash their tax bills”
(foxworldnews). This case centers around Mossack Fonseca’s questionable
accounts where they helped set up shell companies, off shore accounts and
allegedly aided others in tax evasion. The allegations that I am focused on is
Mossack Fonseca’s dealings with Brazilian construction giant Odebrecht.
Ten months after the documents were leaked in the Panama
Papers scandal, Mossack Fonseca’s founders, Jürgen Mossack and Ramon Fonseca,
were arrested on money laundering charges from their connection with the
company Odebrecht. According to the ICIJ, Brazilian and Panamanian officials
targeted the firm as part of a bribery investigation in Brazil, that is the
largest Brazilian bribery scandal now called Lava Jato. Authorities raided Jurgen
Mossack and Ramon Fonseca’s firm and their houses looking for anything they
could find linking them to the Lava Jato case. The law firm’s connection to
this case deals with them helping Brazilian politicians who were involved in
Lava Jato use off shore companies to launder money. The money was laundered and
then washed through Panama, per Panama’s Attorney General, made possible by the
fact that Panama is a well – known tax haven. Odebrecht has been the primary
focus of the Lava Jato investigation; Odebrecht has plead guilty in the United
States and reached settlements with Switzerland and Brazil, over allegations it
paid bribes to government officials (ICIJ).
Stakeholders:
The stakeholders in this case are the employees of
Mossack Fonseca, people from communities where the officials are from that set
up off shore accounts, anyone who does business with Mossack Fonseca. A case of
this magnitude affects many people all over the globe, much of a lawyer client
agreement is about the secrecy of it, and when your files are hacked and leaked
the secrecy is lost. The companies in Panama that deal with financials or law
are also stakeholders because now whether wrong or right they are going to be
looked at as companies doing something shady.
Individualism:
Individualism is a theory that was originally introduced
by Milton Friedman. Friedman’s theory of individualism states, the only
obligation of a company’s owners is to profit, as long as it is within the
constraints of the law. Therefore, the only obligation of its employees is to
make the company, and its owners money; the employee should not be concerned
with anything else other than profits. In this case Mossack Fonseca have been
charged with money laundering, and Odebrecht pleading guilty tells me there is
evidence of illegal activity. Due to this I am lead to believe that Mossack
Fonseca acted unethically. However, just because Odebrecht paid bribes, does
that mean that Mossack Fonseca should have known what Odebrecht does with their
money? Jürgen Mossack and Ramon Fonseca are being charged that means they will
be told by courts whether they did in fact act illegally or not. The obligation
of Mossack Fonseca, under Individualism, is to their clients and to ensure they
are providing them with the services needed for both companies to profit and
nothing else. Therefore, when it comes to Individualism Mossack
Fonseca have acted ethically, barring the charges being proven.
Utilitarianism:
Utilitarianism is a theory that was introduced by, Jeremy
Bentham, and John Stuart Mill popularized it. Utilitarianism attempts to
maximize happiness, it states the only things of intrinsic value are happiness
and pleasure. Under these circumstances happiness was being maximized under both
companies, with Mossack Fonseca playing middle man to aid Odebrecht in
laundering tens of millions of dollars, but it did not last. Charges from
Switzerland, the US, and Brazil have ensued, making those countries unhappy
with these activities as well. Also, once charges came down on these companies
the employees could not have been happy. I do not believe happiness was
maximized in this case making it unethical. The fact that Mossack Fonseca put
their company in a position to be grouped with illegal activity is where they
acted against Utilitarianism. Even being linked to illegal activity makes
people unhappy whether it is true or not and the public would rather separate
themselves from activity like that. Making your company unhappy and the public
not trusting your company makes them unhappy as well.
Kantianism:
Kantianism, begun by Immanuel Kant, is a theory that looks at how actions are motivated. Are your actions rightly motivated, are you using people as a means to an end, or just as a means? Kantianism says using people as a mere means is wrong, but people can use people to get things. There are four principles that are derived from Kantianism, act rationally, do not consider yourself exempt from the rules, allow and help people make rational decisions, and be motivated by Good Will. Much like a baseball player uses a coach to get better, and the coach uses the player to get a bigger name and hopefully a job with a better team. Bringing it to the case with Mossack Fonseca it appears they acted according to this definition; that Mossack Fonseca acted ethically. They gave their clients the services they requested and paid for, and they were consistent with supplying these services. Mossack Fonseca, as of yet, have not been proven guilty, and it is their duty to provide their clients with services that are consistent with how they conduct their business, and Mossack Fonseca did just that. Their services are available to all of their clients. With Kantianism however, one of the principles derived is to allow and help people make rational decisions as Odebrecht’s lawyer Mossack Fonseca cannot necessarily tell them what to do but they can suggest what they should do and they should have tried to lead Odebrecht away from paying bribes out. and even though the charges have not been proven yet by Mossack Fonseca doing something that appeared to be illegal and thus the owners are arrested would tell me that they were not motivated by Good Will. Under these circumstances a Kantian would have to conclude that Mossack Fonseca acted unethically.
Kantianism, begun by Immanuel Kant, is a theory that looks at how actions are motivated. Are your actions rightly motivated, are you using people as a means to an end, or just as a means? Kantianism says using people as a mere means is wrong, but people can use people to get things. There are four principles that are derived from Kantianism, act rationally, do not consider yourself exempt from the rules, allow and help people make rational decisions, and be motivated by Good Will. Much like a baseball player uses a coach to get better, and the coach uses the player to get a bigger name and hopefully a job with a better team. Bringing it to the case with Mossack Fonseca it appears they acted according to this definition; that Mossack Fonseca acted ethically. They gave their clients the services they requested and paid for, and they were consistent with supplying these services. Mossack Fonseca, as of yet, have not been proven guilty, and it is their duty to provide their clients with services that are consistent with how they conduct their business, and Mossack Fonseca did just that. Their services are available to all of their clients. With Kantianism however, one of the principles derived is to allow and help people make rational decisions as Odebrecht’s lawyer Mossack Fonseca cannot necessarily tell them what to do but they can suggest what they should do and they should have tried to lead Odebrecht away from paying bribes out. and even though the charges have not been proven yet by Mossack Fonseca doing something that appeared to be illegal and thus the owners are arrested would tell me that they were not motivated by Good Will. Under these circumstances a Kantian would have to conclude that Mossack Fonseca acted unethically.
Virtue
Theory:
Virtue Theory is a theory that attempts to say whether
you acted virtuously or not. Virtue Theory was begun by Aristotle, and it has
four main virtues of character, courage, honesty, temperance/self-control, and
justice/fairness. In an absence of one of these virtues the action is considered
unvirtuous and would mean it is a vice rather than a virtue. Having courage
under Virtue Theory is defined as risk-taking and willingness to stand for the
right ideas and actions. Mossack Fonseca are not courageous, if they were
courageous then they would have told Odebrecht this is wrong and tried to
distance themselves from this company. While it is a risk to aid a company in
alleged money laundering it is a vice rather than a virtue. That also ties in
to whether these actions are honest which they are not, based on the lack of
the first two virtues, Mossack Fonseca did not act virtuously in this case.
Justified
Ethics:
When I look at the case with Mossack Fonseca I feel they
toe the line of what is ethical and unethical for a business. Some of their
practices come to question such as, giving services to companies like Odebrecht
who pay bribes to government organizations. There should certainly be question marks
around Mossack Fonseca and I do not feel this is a company that I would want to
be associated with. I believe everyone deserves a fair shake when it comes to
allegations but I certainly do not agree with their business dealings.
References:
References:
News, NBC. "Panama Papers: Offshore
Assets of World Leaders Revealed by Leak." MSNBC. NBCUniversal News Group,
04 Apr. 2016. Web. 20 Jan. 2017
O'Rielly, Andrew. "Mossack Fonseca,
Firm at Center of 'Panama Papers,' Has Long History of Shady Dealings."
Fox News. FOX News Network, 04 Apr. 2016. Web. 20 Feb. 2017
"The Panama Papers." The Panama
Papers · ICIJ. N.p., 03 Apr. 2016. Web. 20 Feb. 2017
"Panama Papers Scandal: Top Law Firm
Partners Mossack, Fonseca Arrested." Firstpost.com. N.p., 10 Feb. 2017.
Web. 20 Feb. 2017
Harding, Luke. "Mossack Fonseca:
Inside the Firm That Helps the Super-rich Hide Their Money." Panama
Papers: A Special Investigation. Guardian News and Media, 08 Apr. 2016. Web. 20
Feb. 2017
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