[Theme music]

ELIZABETH:

From Schwartz Media, I’m Elizabeth Kulas. This is 7am.

The Panama Papers were one of the biggest data leaks in history. They helped expose tax evasion and misdeeds that ensnared major companies and foreign governments. The reporter who first got the documents, Bastian Obermayer, on how he handled the leak, and what he’s found in Australia.

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ELIZABETH:

So you’re based in Munich, Bastian?

BASTIAN:

Yeah.

ELIZABETH:

Cool...I used to live in Germany, some time ago, but…

BASTIAN:

So we can do it in German, fantastisch!

ELIZABETH:

We definitely can’t do it in German, it all flew out of my brain! So Bastian, can you describe the day that the Panama Papers first came into your life?

BASTIAN:

It was a terrible day, actually, because I was visiting my parents with my family and they all got sick and I was the only one still standing.

ELIZABETH:

Bastian Obermayer is a Pulitzer Prize-winning investigative journalist with the Süddeutsche Zeitung.

BASTIAN:

I received a message, an electronic message from someone who asked if I was interested in data. He introduced himself by John Doe. That's why I say he. But I also could say he, she, them, because I didn't know at the time. I said I'm very interested. And then I heard my son vomiting and I had to go upstairs and change the sheets, and make some tea and answer to my source. And then I heard my daughter whining. And so it was not actually a good day. But in the end of the day, I had the first seven documents of the Panama Papers.

ELIZABETH:

Did you know right away from those seven documents that this was something big?

BASTIAN:

No, not at all. I saw that the seven documents came from a Panamanian law firm, called Mossack Fonseca, who sold anonymous offshore companies around the world for all kinds of thugs to hide their traces. I knew Mossack Fonseca from former investigations. So I wasn't really interested in the seven documents, but I was interested in speaking to someone who had access to the internal files of this company.

ELIZABETH:

So what happens, these seven documents come in, what do you do next?

BASTIAN:

The leaker decides to give me more information, and more files. 50 more, then 300 more, then 5000 more. And after a while I only counted in gigabytes because it was so much.

You are only buying an offshore company if you want to hide something. So every company is a potential story. You can solve maybe some mysteries that haven't been solved. But moreover, you have a lot of companies that you know now who is the real owner, and no one else in the world except you at this moment.

ELIZABETH:

The thing that I've found so interesting in stuff that I've read about your reporting on this is that it seemed like you were relatively unprepared for the voluminous amount of data just started coming your way…

BASTIAN:

Yes.

ELIZABETH:

How did you keep up with the data?

BASTIAN:

I was paranoid of losing it. In the first month, I was copying around all the time. In my living room, it was always my laptop with one or two external hard drives copying from one to the other. So I was sure I had at least two safety copies whenever I needed them. They are very easy to damage when you let them fall from like, one and a half meters or from one meter, it’s already damaged. And I must have destroyed two external hard drives. I was completely overwhelmed.

In the beginning, we were only collecting findings and very early we contacted the International Consortium for Investigative Journalists in Washington, the ICIJ. They are like the middlemen who would organize a large-scale collaboration between more partners. And we invited them, and we said, look, we've got this data. Maybe you might be interested in doing this as a collaborative story. And they said yeah, let's look at it. The moment we invited more colleagues from other countries, the stories multiplied because they were all searching things and persons that were important in their respective countries. And I have no clue who might be important in Paraguay or in Nigeria or even in the Netherlands. But they did, of course.

We got more and more and more hits and more and more stories, and we ended up having 5000 individual stories from the Panama Papers. We had reporting about leads to more than 70 heads of states around the world. We had all the big banks, which is a very important part of the offshore world. If the big bank wouldn't be the billing helper, there wouldn't be an offshore world, because you need always a bank account, from Deutsche Bank to Citibank to...you name it. Every bank was working with offshore companies and was offering them bank accounts around the world.

ELIZABETH:

It seems kind of counterintuitive. I mean, someone came to you, gave you what becomes the largest data leak, probably in history by volume. You wanted to share it with other journalists. I mean, how did your editor take that?

BASTIAN:

There were people who thought that we must have become crazy. Why would you share a scoop if it's your scoop? But we had worked with the ICIJ before and all the other big investigations. You clearly saw that there was a huge public interest in some other country. So, when we were looking through the first documents, we already had the idea. We can give something back, we can share this.

ELIZABETH:

So Bastian, in April 2016, tell me what the feeling is like in the lead up to deciding that you are actually going to go public. Not only Süddeutsche Zeitung, but other publications around the world.

BASTIAN:

So in the last weeks, we barely slept. We were trying to finish all the stories. And we also had to confront all the people we were planning to write about. So we confronted Mossack Fonseca four weeks before we published. And we also had to confront Vladimir Putin and all kinds of bad people, if you will. We didn't feel so well in the last weeks because we knew that they knew. But the public didn’t know yet, so we were incredibly nervous. And then the day arrived.

Archival tape — Unidentified Man #1:

“The so-called Panama Papers paint a picture of widespread corruption and tax evasion by wealthy and famous people from a number of countries…”

Archival tape — Unidentified Man #2:

“The documents appear to show links to 143 politicians. Among the current leaders named are the president of Argentina, Mauricio Macri…”

Archival tape — Unidentified Woman #1:

“The Icelandic prime minister has stepped down, becoming the first major casualty of the Panama Papers leak. The files showed his wife owned an offshore firm with big claims on the country's collapsed banks…”

Archival tape — Unidentified Man #3:

“An unprecedented leak of documents shows how Vladimir Putin's inner circle became very wealthy.”

Archival tape — Unidentified Woman #2:

“It's claimed up to two billion dollars have been funneled outside of Russia through President Putin's close friends.”

BASTIAN:

We couldn't imagine what would happen then. We were trending topic on Twitter and every big news outlet was reporting on it, and all the international TV stations started to publish and there were mass demonstrations in five countries. It was unbelievably crazy, that time, the first days.

ELIZABETH:

We’ll be right back

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ELIZABETH:

Bastian, you’re contacted by this source, John Doe. You become the first point of contact for the Panama Papers, which, you know, becomes a global phenomenon. What happens after those first pieces are published?

BASTIAN:

Many maybe knew that they were to be found inside the Panama Papers. So they took the first step, because usually you get a better treatment if you confess and you go to the taxman and say, hey, look I forgot to tell you that I'm cheating on my taxes now for many years. Then you might even end up with an amnesty. But if they find you, no way.

But the most important impact was that we made a large part of the world aware of this parallel world that existed. The world where the rich and powerful could hide the money and their traces, which is the same world that is being used by many, many criminals to hide the traces and to evade sanctions and to do all kinds of illegal stuff. And because the Panama Papers was such a monster of a story that hit so many countries at the same time, we actually created this moment for political action.

Archival tape — Unidentified Woman #1:

“Was an impressive raid yesterday at Deutsche Bank's headquarters right behind me....”

Archival tape — Unidentified Man #1:

“...the fight that we were up against here is not against the Maltese people. It's against the corrupt government and that fight will continue.”

Archival tape — Unidentified Man #2:

“This is unprecedented in Pakistan. We've...it's unprecedented that a sitting prime minister faces this level of scrutiny and then is removed from office.”

Archival tape — Unidentified Woman #2:

[Ecuador reporter speaks about Panama Papers in Spanish]

BASTIAN:

Many NGOs started campaigning right away for more transparency. And pressure was so high in many countries, actual change could really happen. We saw legislative changes in many countries, from Germany to India to Ecuador, and the offshore world has really declined since then.

It's still there. It's still unfair because if you're a super rich guy and you go to a bank and say, look, I've got 50 million dollars and I'm allergic to taxes, then they'll bring you on a table with two lawyers and two bankers and they'll set up a foundation in Bahamas, and that owns a foundation in Panama, that owns five shell companies in Bermuda islands, and in the end you don't pay taxes anymore and no one really knows, is it legal? Is it illegal? And in this kind of shady world, I think it's still happening.

ELIZABETH:

Just last month, Bastian, in Australia, the high court has ruled that Glencore, one of the most profitable companies in the world, the court has ruled that Glencore can’t stop the Australian Tax Office from accessing documents that were leaked through another one of your investigations, The Paradise Papers. What did you make of that ruling...that something you did years ago was still having an impact on the other side of the world?

BASTIAN:

What the big multinationals now have to be aware of is the fact that following the letters of the law may not be enough. They all have to accept now that they can argue it's all legal, but unless a court has had a deep look at it, no one really knows. There are so many loopholes left and I think the legislation around the world should be made way easier to prevent the big multinationals like Facebook, for example, to dodge the taxes. Facebook is a good example because it's a company that just doesn't care about their reputation regarding taxes. They just don't mind. They are so big that they can afford to ignore whatever reporting comes their way.

ELIZABETH:

Bastian, you've spent the last month in Australia. What have you made of the state of whistleblower protections here, or the lack of whistleblower protections?

BASTIAN:

You know, we all need whistleblowers. That's what we have to learn. If it weren't for whistleblowers, we wouldn't have had the Panama Papers. We wouldn't have had so many revelations that we all think we needed to know. I think that the whistleblower law in Australia, as it's now planned, is at least a good step. But I think it's not enough. I think if you're doing something in public interest, then you shouldn't be punished for it, even if it's against the law. In that moment, laws change, the public interest doesn't really. I was really surprised to learn that raids have happened here at ABC and the home of a reporter for stories they did. And the imagination that the German government would have raided my house to get a hold of the Panama Papers would have been...not possible in Germany.

ELIZABETH:

And Bastian, how did you protect your source?

BASTIAN:

Well, we did what we could. We used all kinds of encryption. We had the big advantage that we didn't know the source so we couldn't make a dumb mistake by accidentally speaking out the name because there was no name. We stored all the data on a computer that never had any connection to the Internet or any other servers.

We even put a glitter nail polish on the screws so we would see if someone would try to tamper with it. And we found a really exceptionally strange nail polish, which my daughter now loves. And so we did all kinds of stuff. But in the end you also need luck. No journalist should be proud of a story when in the end, your source has been burned.

ELIZABETH:

And what happens now to the masses of data, not just for the Panama Papers, but also for the paradise papers. Are stories still being published from that material?

BASTIAN:

It's very current still. I mean, we've got data that we got in a second batch in 2018. We still have many colleagues from around the world who find a trace there, and then they write us a message and say; ‘look, I've got this story, it's of public interest. Would you share the documents with us?’ And we do that every time we think a story is convincing. The beginning of next year will be a big trial in the US, and the big, the first US indictment for Panama Papers. There's been a big raid at Deutsche Bank headquarters in Frankfurt in the end of last year and that is also still ongoing. So it's still a developing story.

ELIZABETH:

Bastian, thank you for speaking to us.

BASTIAN:

Thank you for the conversation. Thanks for having me.

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ELIZABETH:

Elsewhere in the news:

Jaymes Todd has been sentenced to life in prison for the rape and murder of Eurydice Dixon. He will serve a minimum non-parole period of 35 years. In his sentencing remarks, Justice Stephen Kaye said the crimes were, quote: "of pure and unmitigated evil". Kaye said that Todd had been diagnosed with sexual sadism disorder and that his mild autism was only a small, mitigating factor.

And Peter Dutton has reiterated his refusal to offer refuge to a Tamil family who were living in Biloela. The family has two young children, who were born in Australia. Dutton said he faces tough decisions to stop boats and that the family are not genuine refugees. An interim injunction blocking their deportation ends on Wednesday.

This is 7am. I’m Elizabeth Kulas. See you Wednesday.