Iceland’s PM, first casualty of Panama Papers

Apr 06, 2016 (LBO) – Iceland’s Prime Minister Sigmundur David Gunnlaugsson resigned on Tuesday, the first casualty of the leaked Panama papers.

The Panama Papers showed that his wife owned an offshore company with claims on Iceland’s banks, which is an undeclared conflict of interest, according to media reports.

More than 11.5 million documents, leaked from the Panamanian law firm Mossack Fonseca, stretch nearly 40 years and highlight how some among the world’s rich and powerful stash their wealth and avoid taxes.

Three Sri Lankan companies are also on the list, but no details have yet been released of their names or involvement in tax evasion.

British Prime Minister David Cameron faced pressure from opponents after his late father Ian was implicated in the leaks, while the Chinese government dismissed as “groundless” reports that the families of President Xi Jinping and other current and former Chinese leaders were linked to offshore accounts.

“There cannot be one set of tax rules for the wealthy elite and another for the rest of us,” Labour leader Jeremy Corbyn said. “The unfairness and abuse must stop.”

Credit Suisse and HSBC denied suggestions they were actively using offshore structures to help clients evade tax, after ICIJ reported that both had helped to set up shell companies.

Soccer star Lionel Messi, Indian film personalities Aishwarya Rai, Amitabh Bachchan and associates of Russian President Putin are among those implicated.

Panama is one of the most secretive of the world’s offshore havens and has not signed up to a global transparency initiative.

According to Süddeutsche Zeitung, the German newspaper the first obtained the leaked documents about an year ago and started sharing them with other media, a look through the Panama Papers “very quickly reveals that concealing the identities of the true company owners was the primary aim in the vast majority of cases.”

Clients can buy an anonymous company for as little as USD 1,000. However, at this price it is just an empty shell. For an extra fee, Mossack Fonseca provides a sham director and, if desired, conceals the company’s true shareholder.