The founders of Panamanian law firm Mossack Fonseca were arrested on Saturday, following their indictment on money-laundering charges allegedly tied to the ever-widening Petrobas corruption scandal in Brazil.

Kenia Porcell, the country’s Attorney General, tweeted news of the two men’s arrest: “Raid of offices of law firm that created limited liability companies in Brazil linked to #LavaJato #PanamaPapers.”

Founded in 1977 by Jurgen Mossack and Ramon Fonseca, the firm is perched at the top of offshore legal services providers. Last year, it became embroiled in controversy as 2.6 terabytes of the firm’s internal documents leaked to the media, purporting to show its involvement in sheltering money obtained through criminal activities. Colloquially known as the “Panama Papers,” these documents sparked multiple trans-Atlantic criminal investigations, whose immediate political causality was Iceland’s then-Prime Minister, Sigmundur David Gunnlaugsson. Upon the two men’s arrest, Ms. Porcell described the firm as a “criminal organization dedicated to hiding assets or money from suspicious origins.”

The indictment of two leading offshore services attorneys represents the latest development in Brazil’s “Lava Jato” investigation. While beginning in 2014 as a relatively modest money laundering case, Lava Jato now represents Brazil’s largest corruption scandal to date, covering allegations of bribes and kickbacks totaling $3 billion at the state-controlled oil company, Petrobras.

Mossack Fonseca had allegedly instructed its Brazilian representative to conceal documents and remove any evidence tending to show the firm’s illegal activities relating to the Lava Jato investigation. “Put simply, the money comes from bribes, circulated via certain corporate entities to return bleached or washed to Panama,” Ms. Porcell stated.

Mossack’s lawyer, Marlene Guerra, told reporters that his client had been refused bail, given the “risk of flight from the country, due to the financial means of our clients.” As of Monday night, both men are being detained in Panama.

If you would like to remain updated on these issues, please click here to subscribe to Money Laundering Watch.