Prosecutors around the world launched investigations in response to a massive data leak that tied some of the world's most powerful people to possible financial crimes, shining the spotlight on the shortfalls of current regulation.
A U.S. Department of Justice (DOJ) spokesman told Reuters that it would determine whether there was evidence of unscrupulous activities at the offshore companies set up by Panamanian law firm Mossack Fonseca, echoing similar statements from authorities in France, Germany, Australia, New Zealand, Sweden, Brazil and the Netherlands.
The political leaders implicated in Sunday's release of the so-called Panama Papers—more than 11.5 million encrypted internal documents from Mossack Fonseca that reveal the extent of wealth stashed in "shell" companies based in offshore tax havens—are already facing backlash.
In Argentina, President Mauricio Macri was asked for an explanation of his time spent as a director of a now-dissolved offshore company, Fleg Trading, which was managed by Mossack Fonseca in the Bahamas. According to Reuters, Macri said in a televised interview that his father—Franco Macri, one of Argentina's richest men—had founded an "offshore company to invest in Brazil, an investment that ultimately wasn't completed."
Iceland's Prime Minister was slapped with a no-confidence motion by opposition parties amid major protests after the Panama Papers revealed he was the owner of an offshore firm. In an interview with Reuters TV, Gunnaughsson said he would not resign, insisting that his wife had paid all relevant taxes.
Pakistan denied any wrongdoing after the daughter and son of Prime Minister Nawaz Sharif were linked to offshore companies, according to Reuters. And Ukrainian President Petro Poroshenko defended his commitment to transparency after lawmakers called for an investigation into reports that he had allegedly moved his confectionery business, Roshen, to the British Virgin Islands in 2014 to avoid tax. Poroshenko tweeted that on becoming president, he turned over management of his assets to "consulting and law firms."
Meanwhile, the involvement of British Prime Minister David Cameron's late father, Ian Cameron, in one of the shell companies named in the documents was "a private matter," according to a spokeswoman for Cameron.
Stashing funds offshore is not illegal, but the international team of journalists who reviewed the leaked documents said they could prove offenses of tax evasion, money laundering, as well the channeling of funds from arms and drug deals.
The leak raised questions about global law enforcement, particularly by the world's largest economy, legal experts told CNBC.
"The most worrying aspect of this scandal is the huge shortfall in U.S. efforts to tackle global money laundering," Ben Rose, partner and co-founder at criminal law firm Hickman & Rose, said in an e-mail.
"Panama is not quite the 51st state, but it is closely tied to the U.S., within its sphere of influence and umbilically linked by the two countries' mutual benefit from the canal. It is extraordinary that it continues to operate in this way."
The Financial Action Task Force, an international body focused on fighting money laundering and terrorist financing, removed Panama from its list of high-risk and non-cooperative countries in February, noting the country's progress in improving anti-money laundering regulatory frameworks.
Panama has launched its own investigation into Mossack Fonseca's activities following the huge leak. The firm's head, Ramon Fonseca, has repeatedly denied any wrongdoing, saying the firm was merely an intermediary that set up shell companies at the request of banks, accountancy and other law firms for those firms' clients.
The Mossack disclosures come on the heels of an investigation by non-profit organization Global Witness into New York law firms, in which only one of the 16 firms involved refused to help conceal proceeds of corruption in foreign states, Rose noted.
"Clearly there is a major problem throughout the Americas with dodgy lawyers enjoying insufficient regulation."
If some of allegations of crime made by the Panama Papers investigators prove true, it could send an urgent message for policymakers to re-think the rules.
Current regulation was outdated because it was designed at a time when commerce was simpler, said Tom Cardamone, managing director of Global Financial Integrity, a non-profit advisory firm specializing in illicit financial flows.
"Regulations have to catch up with technology and have to address loopholes in global financial dealings that permit anonymous companies to be created. There's a lot of work to be done and revelations like these will hopefully be the catalyst," he said.
Michael Carr, business tax services leader, Asia-Pacific at EY, echoed those sentiments.
"The rules were written in an environment where product was manufactured in one part of the world and sold to another part of the world where there was stores and warehouses. But that's just not how commerce is done today," he told CNBC's "The Rundown," referring to the growing presence of intangible assets in corporate earnings and online sales.
Last year, the Organization for Economic Co-operation and Development (OECD) estimated that tax authorities lost about $240 billion annually in global corporate income tax revenues as more multinationals moved to low-tax jurisdictions.
On Monday, the OECD said that it had warned G20 finance ministers just weeks ago that Panama pulled back from a promise to share information on offshore accounts with other countries.
"Panama is the last major holdout that continues to allow funds to be hidden offshore from tax and law enforcement authorities," OECD Secretary-General Angel Gurria said in a statement. "The time has come to make sure that no jurisdiction can benefit from failing to meet their commitments. In the run-up to September's G20 Leaders Summit in Hangzhou, we must use every opportunity to deliver."