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What happened
- In 2016, an anonymous whistleblower (“John Doe”) leaked 11.5 million documents from the Panamanian law firm Mossack Fonseca.
- The data was shared with the German newspaper Süddeutsche Zeitung and investigated by the International Consortium of Investigative Journalists (ICIJ).
- Journalists in over 80 countries worked on it.
What the documents revealed
- How shell companies (companies with no real operations) were created in secrecy jurisdictions.
- These companies were used to:
- Hide assets
- Avoid or evade taxes
- Conceal ownership
- Move money anonymously
- Not all offshore use is illegal, but the secrecy enabled systematic abuse.
Who was implicated
- Current and former heads of state
- Politicians, billionaires, celebrities
- Business leaders and organized crime figures
- Banks and intermediaries that enabled these structures
Notable consequences:
- Iceland’s Prime Minister resigned.
- Investigations and prosecutions began in dozens of countries.
- Mossack Fonseca eventually shut down.
Why it mattered
- It showed that global inequality is reinforced not just by markets, but by legal and financial systems designed to protect wealth.
- It undermined public trust by revealing that elites often play by different rules.
- It led to reforms, transparency laws, and later leaks (e.g., Paradise Papers, Pandora Papers).
Bigger picture
The Panama Papers didn’t just expose corruption — they exposed a shadow financial system that operates parallel to normal law, often technically legal but ethically corrosive.