Bono ‘Distressed’ by Paradise Papers Allegations

Rolling Stone – by Jon Blistein

Bono expressed concern that a Lithuanian shopping center he invested in may have avoided paying profit taxes, The Guardian reports. The U2 singer’s ties to the shopping center were revealed in the Paradise Papers, a global investigation into tax havens and the offshore financial dealings of multinational corporations and wealthy individuals.

In a statement, Bono said he would be “extremely distressed if even as a passive minority investor … anything less than exemplary was done with my name anywhere near it.” He added: “I take this stuff very seriously. I have campaigned for the beneficial ownership of offshore companies to be made transparent. Indeed this is why my name is on documents rather than in a trust.”  

Per the BBC, Bono owned a share in the Aušra shopping center located in the Lithuanian city of Utena via his stake in a company called Nude Estates, based in Malta. In 2007, Nude Estates bought the mall via a company they incorporated in Lithuania called UAB Nude Estates 2. In 2012, Nude Estates Malta Ltd. transferred the ownership of both Nude Estates 2 and the mall to a new offshore company, Nude Estates 1, based on the English island of Guernsey. Both Malta and Guernsey are low-tax jurisdictions, though foreign investors pay a five percent tax on company profits in Malta, while they pay no tax in Guernsey.

Since the revelation in the Paradise Papers, the Lithuanian government has launched an investigation into the mall and its owners. While it is not illegal for the owning company to based in Malta or Guernsey, the Aušra mall is accused of using possibly illegal accounting techniques to avoid paying €47,000 (about $54,400) in local taxes, despite making a profit primarily off of rent from retailers.

The Lithuanian director of Nude Estates 2, Sigitas Jautakis, has denied any wrongdoing and said the company would pay back the taxes they allegedly owed if called upon to do so. He also said he was unaware of Bono’s connection to the company. The owner of Nude Estates, Bryan Meehan, added that Bono’s “involvement has been 100 percent passive and he has not visited any of the locations, nor has he had any involvement in the decision making.”

In his own statement, Bono said that he “welcomed [the] reporting” in the Paradise Papers, which was compiled by the International Consortium of Investigative Journalists. “It shouldn’t take leaks to understand what’s going on where,” Bono said. “There should be public registries so that the press and public can see what governments, like Guernsey, already know.”

http://www.rollingstone.com/music/news/bono-distressed-by-paradise-papers-allegations-w511238