UK banking groups have been given just one week to report back to the financial watchdog on their links to the law firm at the centre of the Panama Papers furore.
Conservative MP Mark Garnier, a former investment banker and the firebrand member of the Treasury Select Committee, said it was "entirely reasonable" for the watchdog to demand such action.
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The issues raised by the leak were "incredibly difficult for banks", he said, and hefty due diligence could make "people with perfectly legitimate banking needs… feel like a shifty tax dodger". But Garnier warned that banks should be "prosecuted alongside tax evaders if their actions helped a criminal activity".
This is now the major task in the wake of the revelations: to identify what among the activities exposed constitutes real wrongdoing or illegality and what of the remainder is legal but undesirable enough to warrant changes in the law.
One UK bank has already been identified in relation to potentially the most serious illegal actions so far alleged. HSBC sought formal identification documents before undertaking work for Drex Technologies, a company owned by Syrian President Bashar Assad's cousin Rami Makhlouf, who is the subject of sanctions in both the UK and US.
The document, which was also signed by an official from the Foreign Office, clearly states that Drex, which Mossack Fonseca had helped to establish in the British Virgin Islands, is owned by Makhlouf.
Two HSBC private bank subsidiaries based in Monaco and Switzerland are among the top ten financial institutions named in the papers, notes the BBC.
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