The first victim of what could be many.

By Claire Zillman
April 5, 2016

The Panama Papers have claimed their first high-profile victim: the prime minister of Iceland.

Sigmundur Gunnlaugsson resigned just two days after a massive leak of documents from Panama law firm Mossack Fonseca revealed that he owned an offshore company with his wife, which prompted accusations that he was hiding millions of dollars in family assets.

The global scandal has ensnared several high profile leaders, including Russian President Vladimir Putin, whose close associates hid money offshore. British Prime Minister David Cameron too has been questioned about his ties to Mossack Fonesca after the hack revealed that his father ran an offshore fund that avoided paying taxes in Britain.

Gunnlaugsson, meanwhile, was directly implicated by the leak of 11.5 million documents from Mossack Fonseca, the contents of which were disclosed by an international coalition of journalists Sunday night. The trove of information—which shows how the firm assisted clients in laundering money and evading taxes—revealed that Gunnlaugsson and his wife had purchased an offshore company called Wintris in 2007. Gunnlaugsson never stated his interest in the company when he entered parliament in 2009, according to the BBC, one of the news organizations to examine the so-called Panama Papers. Eight months later, Gunnlaugsson sold his stake to his wife, Anna Sigurlaug Palsdottir.

Protestors staged a big demonstration in front of parliament in Iceland on Monday, calling for Gunnlaugsson to step down.

It wasn’t just Gunnlaughsson’s ownership of an offshore company that angered Icelanders; what really stoked their rage was Wintris’s significant investments in the bonds of three Icelandic banks that collapsed during the financial crisis of 2008. The prime minister had been involved in talks to determine the banks’ future in what some Icelanders deem a blatant conflict of interest.

Gunnlaugsson did little to quell the controversy when he stormed out of a television interview after being questioned about the offshore company earlier this week. He also asked President Olafur Ragnar Grimsson to dissolve parliament and call early elections, but Grimsson refused.

European news organizations reported that the prime minister obliged protestors’ demands midday Tuesday. It’s rumored that Iceland’s agriculture minister will be his replacement.

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