The Trail of Fraudulent Loans and Operation Pandora: The DGI Manipulated the E-Tax System
Investigations lasting more than a year by the DGI, and later by the Public Prosecutor’s Office, explain how a network managed to alter tax records, create false tax credits and move millions of dollars through a structure that involved officials, lawyers and private companies.
Operation Pandora was a major anti-corruption sweep in Panama that dismantled a criminal ring operating within the Dirección General de Ingresos (DGI). The ring manipulated the DGI’s e-Tax 2.0 system to orchestrate a fraudulent tax credit scheme. Once taxpayers paid their legitimate tax debts, DGI insiders manipulated the system to un-link those payments from the original tax accounts.
The payments were wrongfully logged as “unapplied credits” (meaning they appeared unassigned) and then illegally reassigned, transferred, or sold to lending institutions and third-party taxpayers. This enabled others to clear their tax debts without having ever paid the state, resulting in an estimated $40 million loss to the Panamanian government. Authorities launched a series of coordinated raids across the provinces of Panama, West Panama, Colón, and Coclé. The sting resulted in:
- Arrests: 16 individuals were initially apprehended, including 9 active public officials, 1 former official, and 6 private citizens.
- Charges: The suspects were targeted for money laundering, illicit association, corruption of public servants, and falsification.
Former head of tax collections at the DGI was arrested in March
The Public Ministry’s First Specialized Prosecutor’s Office Against Organized Crime led the investigation, seizing technological equipment and gathering evidence during the raids. For years, a network comprised of officials, lawyers, intermediaries, and financial executives has allegedly found a way to manipulate real tax transactions into fraudulent tax credits, creating a shortfall of at least $40 million for the State. Investigations suggest this had been in operation for at least five years. The scheme was discovered in September 2024. The detained individuals’ names have been withheld from public release by the Procuraduría General de la Nación to protect the integrity of the ongoing investigation. The arrests were made during more than 25 simultaneous raids across the provinces.
What They are Accused of:
Those arrested are being investigated for allegedly manipulating the E-TAX 2.0 system to illegally alter tax payment records. By modifying the status of taxes already paid by taxpayers, the network generated favorable tax credits and reassigned them irregularly. This scheme reportedly cost the State roughly $40 million in patrimonial injury. The individuals are facing preliminary charges of money laundering, illicit association to commit a crime, corruption of public servants, and falsehood.
Individuals, Lawyers, and Companies are Under Investigation: Former Head of the DGI Told Officials how the Network that Circumvented the E-Tax Operated
Eduardo Silvestre is a former high-ranking official at the Dirección General de Ingresos (DGI) in Panama. He most recently made headlines in July as an ex-official and cooperating witness in the “Operación Pandora” case, a major investigation into a multimillion-dollar fraud and corruption ring within the Panamanian tax authority.
Silvestre’s Role: Silvestre has provided testimonies to the Public Ministry, detailing how credits were moved and implicating various lawyers, private individuals, and tax officials in the irregular procedures.
The criminal network made up of officials, lawyers, accountants and private individuals that operated within the General Directorate of Revenue (DGI) diversified its tasks to steal money from taxpayers. According to Silvestre’s statement, some DGI officials with access to the E-Tax 2.0 platform were responsible for altering the emails of taxpayers and legal representatives of companies, and assigning them to third parties.
