Panama papers scandal show cracks in Iceland’s leadership

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After millions of confidential client records from the Panama law firm Mossack Fonseca, were stolen and leaked to the national tax authorities, Mr Sigmundur David Gunnlaugsson, the Icelandic Prime Minister has stepped down over allegations he hid millions of dollars in a BVI company.
The company that was used to hide this money had a direct interest in the health and wealth of Iceland’s banks, which as Prime Minister he was responsible for. Mr Gunnlaugsson has since stated he and his wife (the official owner of the company) have adhered to local laws and have paid all their taxes in Iceland on the amount found. However after the 2008 banking crisis, where the islands banks collapsed due to lack of liquidity, critics are stating that this claim is not sufficient to continue in his position as Prime Minister.

Iceland is not the only country the leak will affect. The list of countries that are interested in the intimate documents continues to grow. Australia, Spain, Germany and Norway are a few of those that have expressed wanting to see if any of their residents have been using the company and have therefore been evading tax illegally.

The recent events in Iceland demonstrates the political power the Panama Papers have on an international level; as well as highlighting that the political commotion from the 2008 financial crisis is still potentially on-going.