Organised crime prosecutors raided the offices of the Mossack Fonseca law firm looking for evidence of money laundering and financing terrorism following a leak of documents about tax havens it set up for wealthy international clients.
Half a dozen police officers set up a perimeter around the offices while prosecutors searched inside for documents.
Shortly after news reports based on documents from the firm began emerging more than a week ago, Panama’s government had said it would investigate.
The attorney general’s office said the objective of the raid was “to obtain documentation linked to the information published in news articles that establish the use of the firm in illicit activities”.
Mossack Fonseca has denied any wrongdoing, saying it only set up offshore financial accounts and anonymous shell companies for clients and was not involved in how those accounts were used.
The search came a day after intellectual property prosecutors visited Mossack Fonseca to follow up on the firm’s allegations that a computer hack led to the leak of millions of documents about tax havens.
The firm filed a complaint alleging the security breach shortly before the first media reports working with the documents offered details on how politicians, celebrities and companies around the globe were hiding assets in offshore accounts and shell companies.
The firm has maintained the only crime which can be taken from the leak was the computer hack itself. It says it suspects the hack originated outside Panama, possibly in Europe.
The law firm is one of the most important in the world for creating overseas front companies.
Panamanian president Juan Carlos Varela has defended the country’s financial sector, which is considered of strategic importance for the economy.
But he has also promised the international community that he is willing to make reforms to make the sector more transparent.
On Tuesday, Mr Varela met legal, banking and business professional associations. Afterwards, he asked France to reconsider its decision to place Panama on a list of unco-operative countries in financial information.
The government announced that Joseph Stiglitz, who won the Nobel Prize in economics in 2001, would be one member of an international panel formed to review Panama’s legal and financial practices and recommend improvements.