As reported last night, one of the first politicians to suffer a career casualty will probably be Iceland's prime minister Sigmundur David Gunnlaugsson, who was exposed by the Panama Papers as secretly owning a company called Wintris set up in 2007 on the Caribbean island of Tortola in the British Virgin Islands, to hold investments with his wealthy partner, later wife, Anna Sigurlaug Pálsdóttir.

The moment when he realized the data had been made public was revealed in this striking interview, during which the PM walked out, saying "What are you trying to make up here? This is totally inappropriate."

The Iceland public appears to agree with at least the second part of his assessment, if only as pertains to his secret financial dealings and as Bloomberg reports, the PM now faces a no confidence vote. "The opposition has called for a vote against the government as parliament begins its session at 3 p.m. local time, though it’s still unclear whether the vote can be held on Monday. Protests in Reykjavik organized by a Facebook group calling for “Elections Now!” are due to start two hours after the opening of the assembly."

The outcome of the vote appears almost certain: "I hope that Sigmundur David realizes the seriousness of this matter and has the decency to resign before parliament convenes today," Birgitta Jonsdottir, a lawmaker for the Pirate Party, said on her Facebook page on Monday.

A March MMR poll showed that Jonsdottir’s political group is now Iceland’s biggest with 37 percent of voters backing it, compared with 36.2 percent for the ruling coalition of the Independence and Gunnlaugsson’s Progressive Party. Still, the premier’s coalition holds 40 of the seats 63 in parliament.

He has so far not resigned, and to the contrary the premier has tried to defend himself, writing on his website that "It’s been clear since before I began participating in politics that my wife had a considerable amount of money. Some people find that in itself very negative. I can’t do much about that because I’m neither going to divorce my wife nor demand that she relinquish her family inheritance."

Bloomberg adds that his wife’s holdings also included bonds in the three failed banks, whose collapse in 2008 brought the country to its knees and triggered the imposition of capital controls. Gunnlaugsson’s judgment is now being questioned since he had been in charge of negotiations with the creditors as part of an effort to exit capital controls.

What is curious is that in this particular case there may be no actual wrongdoing: according to the ICIJ report, Palsdottir says she has always paid all her taxes owed on the Wintris account, which was confirmed by her tax firm, KPMG. That, of course, assumes the auditing firm is telling the truth.



“As has been explained publicly, in establishing this company, the Prime Minister and his wife have adhered to Icelandic law, including declaring all assets, securities and income in Icelandic tax returns since 2008,” a Gunnlaugsson spokesman said in a statement to the ICIJ.

Which goes to the fundamental question behind tax havens: is one guilty until proven innocent simply for having an offshore shell, whether disclosed or not. As Bloomberg notes, "offshore holdings can be legal, though documents show some banks and law firms failed to follow requirements to check their clients are not involved in crimes."

A breakdown of all uses, from the legitimate to the illegal is shown below (courtesy of Fusion).

In the case of Iceland's prime minister, we may get the answer as soon as this afternoon.