Over 11 million documents were leaked from Panamanian law firm Mossack Fonseca disclosing hidden financial dealings of over 214,000 entities in about 200 countries and territories.
The papers cover 40 years, from 1977 to December 2015, and exposed 140 politicians and public officials from around the globe, including 12 current and former world leaders, apart from celebrities, sport stars, billionaires, drug lords, and fraudsters.
At least 33 companies (or countries) and people blacklisted by the US government including Iran, North Korea, terrorist groups such as Hezbollah, and Mexican drug barons were also listed among those who had done illegal transactions.
Many of the companies who used the off-shore tax havens were secretive and avoided taxes through Mossack Fonseca, while rogue nations dodged sanctions and fraudsters laundered money with the help of the law firm.
"I think the leak will prove to be probably the biggest blow the offshore world has ever taken because of the extent of the documents," said Gerard Ryle, director of the International Consortium of Investigative Journalists.
The 'Panama papers' were uncovered by International Consortium of Investigative Journalists, and over 100 other news organizations.
According to the papers, Hong Kong is the top location where banks and law firms have hosted corrupt and criminal businesses. UK's Virgin Islands are the next favorite haven for malpractices, according to Christian Aid.
"This leak exposes the extent to which UK tax havens and UK-based intermediaries are at the very heart of this rotten system," Toby Quantrill, Principal Economic Justice Adviser at Christian Aid, said in its press release.
Christian Aid investigated shadowy deals in the Swiss branch of HSBC, and found that poorer countries suffer most from tax evasion. Their research showed that the proportion of money siphoned off from the developing countries to tax evasion is much higher than developed countries in terms of the volume of illicit flow relative to the size of their respective economies.
The study concluded that the impact of tax dodging and illegal off-shore transactions was worst on poor people of the developing countries.
Quantrill continued: "In the longer term we need a new system of global cooperation to tackle this deeply rooted and highly corrosive problem of financial secrecy - one which we can all trust."