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article imageCameron argued against full scrutiny of offshore trusts in 2013 letter

By AFP     Apr 7, 2016 in World

British Prime Minister David Cameron, whose father ran an offshore investment fund according to the Panama Papers, wrote to European leaders in 2013 to warn against opening offshore trusts to full scrutiny, it emerged Thursday.

The letter, published on the government website at the time, was brought to public attention by the Financial Times on Thursday amid the global Panama Papers scandal.

Finding himself under pressure to reveal whether he benefited from offshore assets following his father's death in 2010, Cameron has so far only said that there were "no offshore trusts or funds" that he or his immediate family would benefit from "in future".

However, the publication of the letter sent in 2013 raised further questions about what happened to his father's assets from Blairmore Holdings Inc, details of which were revealed by the leak from Panamanian firm Mossack Fonseca.

The two-page note to former European Council president Herman Van Rompuy backed an EU clampdown on secretive offshore shell companies but argued against extending the clampdown to trusts.

Offshore trusts can be used to protect its beneficiaries from paying tax on its assets, which can include property, cash and trading companies.

In the letter Cameron wrote: "As we clamp down on the misuse of companies, we must take care not to displace illicit activity elsewhere.

"I know some want Europe to go even further to prevent the abuse of trusts and related private legal agreements.

"It is clearly important we recognise the important differences between companies and trusts," he added.

A government spokesman said the letter was meant to focus attention on the use of anonymously-run shell companies, which have been used to evade tax and launder money.

"The government was concerned that including trusts would distract from action against those areas of most concern, such as shell companies," he said, according to the BBC.

Cameron has claimed to be leading efforts to clamp down the use of offshore havens, but the leaks have led to criticism that the government is too close to Britain's huge finance sector to implement serious change.

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