The shell company, Wintris, was formed in 2007, according to the International Consortium of Investigative Journalists (ICIJ) which published the papers, but was not declared when Mr Gunnlaugsson entered parliament in 2009.
Reports have surfaced that Iceland’s prime minister is resigning, due to his alleged involvement in the ‘Panama Papers’ debacle that came into light in the last week.
However, in a contradictory statement from his press secretary it is suggested that “The Prime Minister has not resigned and will continue to serve as Chairman of the Progressive Party”.
Olafur Ragnar Grimsson, the President of Iceland, has not yet confirmed any changes to the leadership.
The Prime Minister has denied any wrongdoing and says he sold his shares in Wintris to his wife, but opposition said the holdings were a major conflict of interest with his job. According to the ICIJ Wintris had $4 in the bonds of three banks which failed in the 2008 economic crisis.
The Panama Papers, published on Sunday, consist of more than 11 million documents and name a number of current and former world leaders who allegedly used the services of Mossack Fonseca.
So far, there is no indication that any of the individuals named in the documents have done anything illegal.