Panama Papers claim first victim as Iceland’s Prime Minister resigns

Icelandic Prime Minister Sigmundur David Gunnlaugsson has resigned in the wake of revelations detailed in the Panama Papers that his wife owns a British Virgin Islands company that holds millions of dollars of claims against three failed Icelandic banks—claims that Gunnlaugsson’s government is involved in resolving.

Mr. Gunnlaugsson’s resignation was announced on television by Sigurdur Ingi Johannsson, a government minister and the deputy chairman of his Progressive Party, and it was confirmed by the state broadcaster, RUV.

With Gunnlaugsson on his way out, his deputy in Iceland’s Progressive Party, Sigurdur Ingi Johannsson, will lead the country, according to Godjon Helgason, a reporter at Icelandic National Broadcasting Service who spoke to NPR’s Newscast unit.

No replacement has yet been named, and Iceland’s president has not yet confirmed that he has accepted the prime minister’s resignation. Crisis meetings continued as several hundred protesters gathered outside parliament Tuesday in Reykjavik to protest the offshore accounts set up by Gunnlaugsson and his wife.

People gathered during a protest on Austurvollur Square in front of the Icelandic Parliament in Reykjavic, Iceland, on April 4, 2016. (Photo: Birgir Por Hardarson, EPA)

People gathered during a protest on Austurvollur Square in front of the Icelandic Parliament in Reykjavic, Iceland, on April 4, 2016. (Photo: Birgir Por Hardarson, EPA)

The resignation of the prime minister, Sigmundur David Gunnlaugsson, was the first prominent political fallout from the document leaks known as the Panama Papers, which have shed a harsh light on the private financial activities of many rich and powerful people.

Officials around the world, from Europe to Asia to the Americas, were scrambling on Tuesday to contain the fallout — particularly in Britain, where Prime Minister David Cameron, who has portrayed himself as a champion of financial transparency, was battling revelations in the leaks that British-governed territories are vast havens of hidden wealth, including for members of his own family.

Gunnlaugsson has said previously that he has done nothing wrong or illegal, although it appears that he violated Icelandic law by failing to disclose his family’s holding.

The data breach purports that Gunnlaugsson and his wife had a stake in a company seeking millions of dollars from failed Icelandic banks. The revelation sparked a public outcry in Iceland.

The leaked Panama Papers consist of more than 11.5 million documents, involving nearly 215,000 companies and 14,153 clients of the Panamanian law firm Mossack Foneca, according to the German newspaper Süddeutsche Zeitung. It shared the information with the International Consortium of Investigative Journalists, a nonprofit group, which helped analyze the data and shared it with a number of other newspapers, which began reporting the findings on Sunday.

The politicians, celebrities and sports figures identified in the leaks included close associates of President Vladimir V. Putin of Russia; President Petro O. Poroshenko of Ukraine; Prime Minister Nawaz Sharif of Pakistan; current and former members of China’s ruling Politburo; and FIFA, the worldwide association for soccer. It has also emerged that Mossack Fonseca worked with 33 people or companies that were the subject of international sanctions, including a relative of the Syrian president, Bashar al-Assad.