Iceland prime minister resigns over secret wealth

Iceland’s Prime Minister Sigmundur David Gunnlaugsson has stepped down after widespread protests over his secret offshore wealth that was revealed in a massive data leak known as the Panama Papers.

“The prime minister told (his party’s) parliamentary group meeting that he would step down as prime minister and I will take over,” the Progressive Party’s deputy leader, Sigurdur Ingi Johannsson, told national public broadcaster RUV on Tuesday.

Earlier in the day, Gunnlaugsson announced he would call snap elections after dissolving the parliament, but President Olafur Ragnar Grimsson said ending the coalition government with the Independence Party needs “support” from the ruling coalition.

"I need to determine if there is support for dissolving (parliament) within the ruling coalition and others. The prime minister could not confirm this for me, and therefore I am not prepared at this time to dissolve parliament," Grimsson said.

On Tuesday evening, a huge crowd of protesters took to the streets of the capital Reykjavik denouncing Johannsson's new role as prime minister, saying he was not elected.

Calls for Gunnlaugsson to resign have been on the rise since the leaked tax documents showed that the 41-year-old coalition government leader, now considered to be the first major casualty of the Panama Papers, and his wife had purchased the offshore Wintris company in the British Virgin Islands back in 2007 and placed millions of dollars there.

According to the documents, Gunnlaugsson then sold his share to his wife Anna Palsdottir for a symbolic sum of one US dollar after he entered the parliament in 2009. He is now accused of failing to declare his interest in the firm when he entered the legislature later to evade taxes.

Late on Monday, thousands of angry Icelanders demonstrated outside the parliament building in the capital, demanding Gunnlaugsson’s resignation. Moreover, about 28,000 Icelanders signed a petition calling for his resignation.

On Sunday, Süddeutsche Zeitung, a German newspaper working with the International Consortium of Investigative Journalists (ICIJ), said it had received a cache of 11.5 million leaked documents from the internal database of the Panamanian law firm Mossack Fonseca and shared them with more than 100 other international news outlets as well as the ICIJ. 

The massive leak showed how the high-profile firm specializing in establishing shell companies has helped clients launder money, dodge sanctions and evade taxes.

The leaked files exposed the secret offshore dealings of aides to Russian President Vladimir Putin, Chinese President Xi Jinping's relatives, some world leaders, and celebrities including Barcelona forward Lionel Messi.

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