It comes as no surprise that the authorities appear to have caught up with Mossack Fonseca’s founders, Jürgen Mossack and Ramon Fonseca, who were arrested last month in Panama City and the firm’s offices raided.

The news is a further devastating blow to the firm, already reeling from the aftershocks of the Panama Papers scandal, which lays the blame squarely at its feet for some of the more infamous revelations.

In a statement, Panama Attorney General Kenia Porcell said the firm allegedly worked with contacts in Brazil to “destroy evidence related to those implicated” in the bribery scandal.”

In short: Money from bribes circulate through various places to return laundered to Panama,” Porcell said.

Although further details have yet to be released, tying the firm to the Brazilian Lava Jato (‘Operation Car Wash’) scandal is a huge development. The year-long investigation reads like a Who’s Who of South American countries. Added to the mix are investigations in the United States and Switzerland.

The news about the Mossack and Fonseca arrests comes at a time when the Panama Papers scandal was fading into history, only for the embers to reignite. I for one have mused that silence was not linked to inaction. Most criminal investigations are cloaked in secrecy for obvious reasons.

The Panama Papers story was simply too big and too grave for law enforcement to ignore. Public interest was always going to dictate that a full investigation would be required to gauge the depth of the problems being unearthed. The Brazilian Lava Jato investigation is huge. The many levels of corruption and the losses incurred by the public purse, demands that many stones be overturned.

Although it remains to be seen if Mossack Fonseca’s founders were aware and complicit in the events tying the firm to Operation Car Wash, it is highly unlikely that the authorities would target the founders without reasonable suspicion that they may have been involved, either directly, or by turning a blind eye. MF has issued a denial that it was connected to any entity linked to Operation Car Wash.

The underlying problems for the firm are those of a lack of plausibility and credibility. There have been too many revelations and too many blanket denials. At some stage mud is going to stick. Mossack Fonseca handled the initial and subsequent fallout very poorly.

Issuing denial after denial (or flimsy excuses) is not the way to limit damage when under a crescendo of criticism and volley after volley of journalistic cannon fire. Ramon Fonseca’s analogy of Mossack Fonseca being like a car manufacturer, where you can’t blame General Motors for a reckless driver, was a red herring: offshore incorporators are required to “know their customers” under AML law. At some stage they have to admit to some meaningful culpability.

If Mossack Fonseca has knowingly facilitated the movement of assets away from Brazil, then it deserves all it will get. Grand Corruption is an insidious crime against humanity and needs to be eradicated. In this instance, the ordinary citizens of Brazil have suffered the most as billions of dollars of value have been unlawfully diverted elsewhere.

There is going to be a lot more fallout from the Panama Papers scandal. The countries affected who have lost billions in tax revenue as a consequence of tax evasion will not let matters lie. Added to this the facilitation of money laundering for criminal gangs and organized crime, plus the potential links to terrorist extremists and their revenue streams, and you have a heady cocktail of reasons why this scandal is anything but dead. The global authorities owe it to their people to right the wrongs and bring those responsible to book. So watch this space.