Several world leaders are under fire after a consortium of journalists recently revealed their ties to a Panamanian law firm that helped some of the world’s richest and most powerful people conceal their wealth through tax havens and offshore companies.
The revelations are based on the “Panama Papers,” 11.5 million leaked documents tied to the Panamanian law firm Mossack Fonseca.

Among the prominent figures listed in the documents are Iceland’s Prime Minister Sigmundur David Gunnlaugsson and Ukraine’s President Petro Poroshenko. British Prime Minister David Cameron, Pakistan’s President Nawaz Sharif and Russian President Vladimir Putin are also connected to the leak through associates or family members. Putin’s friends, the documents show, have amassed over $2 billion in offshore holdings.

Jurgen Mossack and Ramon Fonseca Mora -Founders of Mossack Fonseca
Jurgen Mossack and Ramon Fonseca Mora
-Founders of Mossack Fonseca

German newspaper Suddeutsche Zeitung first obtained the documents from an anonymous source over a year ago, and then joined with the International Consortium of Investigative Journalists (ICIJ) to analyze the immense amount of data. While reports on the exact ties between prominent figures and Mossack Fonseca continue to be released, the ICIJ has revealed that in total, over 140 public officials and politicians’ offshore holdings are included in the documents.

As the reporters working on the Panama Papers are careful to note, there are a number of legitimate reasons to have offshore holdings. Journalists allege, however, that the documents clearly show a number of instances in which there is the appearance of corruption, tax evasion and money laundering.

What’s the biggest implication of the leak?
It’s still too soon to tell what the most important consequence will be from the leak, but the biggest immediate waves are being felt in Iceland.

Documents from Mossack Fonseca revealed that Prime Minister Gunnlaugsson and his wife founded an offshore company, Wintris Inc., that was based in the British Virgin Islands. The revelation is especially notable given Iceland’s recent history, in which the country was lauded for cracking down on bankers and executives whose market manipulations contributed to the collapse of the nation’s economy in 2008.

Other world leaders find themselves under fire
There are a number of world leaders who are now on the defensive following the leak, though the possible political ramifications vary for each person.

In Ukraine, lawmakers from multiple parties called for an investigation into President Poroshenko’s business dealings after the documents revealed he was the sole shareholder of an offshore company set up by Mossack Fonseca called Prime Asset Partners Limited.
U.K. Prime Minister David Cameron also has a connection to the leak, as his late father, Ian, is implicated in running an offshore investment fund based in the Bahamas that avoided paying tax in the United Kingdom.

Pakistan’s Prime Minister Nawaz Sharif has also been tied to the leak through his family, as it was revealed that three of his children have links to a number of offshore companies.
Another leader not directly named in the documents but connected through close associates is Russia’s President Putin, whose wealth has long been the subject of speculation.

Meanwhile, over 500 Indians figure on the firm’s list of offshore companies, foundations and trusts. Investigators have also found Bollywood superstars Amitabh Bachchan and Aishwarya Rai Bachchan also connected to the leak.

What happens next?
The fallout from the Panama Papers is still occurring, but many regulatory bodies and governments have already pledged to investigate journalists’ findings.

Mossack Fonseca has denied any wrongdoing in the wake of the leak. Founder Ramon Fonseca told Reuters on Monday that the firm had suffered a “limited hack” and said they had notified clients.
(With input from Huffington Post)

Panama Papers (4) Panama Papers (3)