Leaked Panama Papers have world’s rich and powerful scrambling

The world’s rich and powerful were scurrying for cover Monday after what may be one of the largest leaks of secret intelligence that the world has ever seen.

The cache of documents from a Panamanian law firm, dubbed the Panama Papers, were purportedly leaked to the German newspaper Sueddeutsche Zeitung by an anonymous source last year, and shared with several international media outlets. Those outlets’ reports, published over the weekend, appear to show how the world’s political, sports and entertainment elite — and maybe drug traffickers — have hidden money in offshore accounts.

By itself, it is not illegal to hold money overseas. But the implication here — still not necessarily proved — is that many of those mentioned evaded taxes to enrich themselves, to the tune of billions of dollars. Or that money illicitly obtained was laundered through such clandestine networks.

As the scandal widened across borders like a gigantic oil spill, country after country, as well as many of the prominent figures mentioned, issued denials and statements of outrage and indignation. Activist groups, meanwhile, demanded investigations into the tax havens provided by countries such as Panama, the Seychelles and scores more, including the United States.

From Russia to China, from Iceland to Argentina, the revelations were explosive.

Associates of Russian President Vladimir Putin were reportedly tied to more than $2 billion in secret loans. The Kremlin dismissed the allegations out of hand as part of a smear campaign targeting Putin.

There was no official reaction in China to allegations that relatives of President Xi Jinping were squirreling away their riches. It appeared the reports were being censored on the Chinese mainland.

Iceland’s prime minister, Sigmundur Gunnlaugsson, rejected opposition calls to resign after his wife’s name surfaced in the documents.

Two of Mexico’s leading millionaire television executives were among those named, along with a major construction tycoon whose work for President Enrique Peña Nieto already sparked local allegations of corruption.

Some countries, such as France and Australia, immediately opened investigations into possible money laundering and tax evasion.

The International Consortium of Investigative Journalists, which took the lead in publishing the trove of more than 11 million documents dating back four decades, said the information appears to show that the law firm, Mossack Fonseca, established shell companies and offshore accounts to help hundreds of people move their money.

The firm issued a statement saying the information ricocheting around the planet was full of inaccuracies, and that its industry practices are misunderstood.

“The facts are these: while we may have been the victim of a data breach, nothing we’ve seen in this illegally obtained cache of documents suggests we’ve done anything illegal, and that’s very much in keeping with the global reputation we’ve built over the past 40 years of doing business the right way, right here in Panama,” the statement said. “Obviously, no one likes to have their property stolen, and we intend to do whatever we can to ensure the guilty parties are brought to justice.”