TORONTO/OTTAWA, April 4 (Reuters) - Royal Bank of Canada said on Monday it had controls in place to prevent illegal activities after documents allegedly showed it had regularly used the services of a Panama-based law firm at the centre of a massive data leak exposing possible tax evasion.
RBC, Canada’s biggest bank, is one of several financial institutions named in documents that appear to show how some clients of law firm Mossack Fonseca evaded tax and laundered money. The documents emerged in an investigation published on Sunday by the International Consortium of Investigative Journalists.
RBC and its subsidiaries were associated with 378 shell companies registered in the Mossack Fonseca data, the Toronto Star newspaper reported.
In an emailed statement on Monday, RBC said that it worked within the legal and regulatory framework of every country in which it operates and had an extensive due diligence process to understand what its clients intentions are.
“Tax evasion is illegal, and we have established controls, policies and procedures in place to detect it and prevent it occurring through RBC,” the bank said.
RBC said there were a number of legitimate reasons for clients to set up a holding company.
“If we have reason to believe a client is seeking to commit a criminal offence by evading taxes, we would report the offence and not do business with the client,” it added. (Reporting by Matt Scuffham; Editing by Meredith Mazzilli)