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The fall of Mossack Fonseca, a Panamanian law firm caught in an international tax scandal, is the stuff of movies.
Founded 40 years ago, it became one of the largest providers of offshore services in the world. It served more than 300,000 company clients in more than 40 countries.
It started to fall apart after hackers exposed tax liabilities for its wealthy clients who hid money in offshore accounts. Then there was a government investigation. Oh wait, that was a movie.
Taxes and Bribes
Panamanian authorities raided the offices of Mossack Fonseca last month, looking for links to a Brazilian construction firm. Oderbrecht, the largest engineering company on the continent, has admitted to bribing officials for contracts in the region.
Mossack Fonseca has denied any connection to the bribery, but could not escape the tax questions. The scrutiny has plagued the firm for two years, ever since the publication of the "Panama Papers."
According to reports, more than 11 million of the firm's client files were leaked on the internet. The repercussions from the data breach were too much to handle.
"The reputational deterioration, the media campaign, the financial circus and the unusual actions by certain Panamanian authorities, have occasioned an irreversible damage that necessitates the obligatory ceasing of public operations at the end of the current month," the firm said in a statement.
The firm said it would keep a skeleton staff working to cooperate with authorities and others.
German attorney Jürgen Mossack founded the firm in 1977. Panamanian lawyer Ramón Fonseca and Swiss lawyer Christoph Zollinger later became principals in the firm. The founders are facing money laundering charges.
Until the data breach, Mossack Fonesca operated in relative obscurity. The law firm was the world's fourth-largest provider of offshore services when the Panama Papers hit the internet.
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