As you're reading the Panama Papers – and I think that you should – you're likely going to be hit with an overwhelming sense that you need to do something. This will be particularly true if you work in a financial institution, especially in risk, compliance, ethics or management. While that feeling isn't wrong, your sense of the scope of the issue is likely way off. I don't want to frighten you, but it's much, much worse than you think.

The reports resulting from the documents release that we're seeing now are the tip of the proverbial iceberg. I fully expect this iceberg to flip over, revealing things that none of us expected. To understand how bad it's likely to get, we need to put what we already know in context.

Mossack Fonseca

At the heart of the Panama Papers story is the notorious Panamanian law firm Mossack Fonseca, now known as the money laundering vehicle of the elite, which helped clients establish offshore shell companies.

But Mossack Fonseca is also just a law firm, and problems associated with offshore accounts extend beyond this one firm. The American Bar Association's 2015 statistics indicate that in 2015 there were 1,300,705 active lawyers in the United States alone. While not all of these lawyers were active in creating shell companies, a recent study conducted by Global Witness, also reported on 60 Minutes, seems to indicate that a shockingly high proportion of lawyers may be willing to assist in such activity.

Taken in context, there are millions of lawyers, and it may be very difficult to separate those that are involved in shady dealings from those that aren't. At the very least, we should be paying a bit more attention to those "gatekeeper roles" that our regulators and compliance officers have been droning on about for the last decade. While we're at it, it makes sense to pay closer attention to "ultimate beneficial owners" as well.

Once upon a time, it was enough to know that a lawyer was holding funds in trust for a wealthy client. Financial institutions wanted the business. We were taught that high net worth customers expected different privacy standards. Willfully or otherwise, at best we've been blind to (and blindsided by) the risk that these accounts carried with them. At worst, we've been complicit in a system of secret handshakes and institutional corruption.

Over 500 Banks

Analysis to date indicates that over 500 banks, branches and subsidiaries may have been complicit in establishing shell companies in conjunction with Mossack Fonseca. If one law firm can pull in so many banks, what can an army of lawyers over a million strong accomplish? Where does the corruption stop? How do we protect our institutions?

If you've ever wondered why your customers, employees, board, investors and other "insiders" – capable of participating in an offshore shell company scheme – might be risky to your organization, the Panama Papers have provided your answer. Whether they are directly complicit, paid to grease the wheels or simply duped into participation, they all present the same level of risk. Those that are actively complicit are likely to use their own power to cover their tracks, and may be more difficult to detect. Even when we can suss them out, their actions (and the associated risk) can linger long after they've walked out the door.

The Official Currency of Corruption

It is impossible to establish a context without correcting an important myth: there is no "black market peso exchange." There is, however, a thriving, global, U.S. dollar exchange. This is logical: criminals and money launderers want to be able to keep their funds in an asset that is liquid and stable in value. As long as gold is heavy and bitcoin is volatile, I expect that Uncle Sam will continue to be the unwilling banker of choice for criminal elements worldwide (including those places where use of the dollar is effectively banned by U.S. sanctions). This is not an indictment of the dollar – to the contrary, the currency is a bit like that popular kid that everyone dreams of taking to the prom.

It does mean that we must never assume that a transaction denominated in dollars is less risky than one transacted in another currency. It means that we cannot assume that because a company is always paid in dollars, it is not a shell company. It means that we cannot treat accounts that only hold dollars as being beyond reproach. The threat is real, and it is closer to home than any of us would like to believe. It's time to face that reality.

Smart Money Moves

For all of the treasure trove of data that they present, the Panama Papers are backwards looking. While they can inform us and help us to guard against known risks, that rear view does not show us the road ahead – or even the road beneath us. The names of many shell corporations will be revealed, but it is foolish to think that everyone was caught by surprise without a contingency plan. In some cases, people will have been tipped off in advance. In others, defensive measures will have been initiated as the story was breaking. In either case, smart money has moved on.

Our challenge is, as it has always been, to try to figure out where it's heading. To prevent, detect and deter. This is simple on paper, but so challenging in practice that I cannot foresee a time that our work will be finished. As long as there is an opportunity to profit, it seems likely that someone will try.

Transparency Is the New Magna Carta

In all this, there is one clear beacon of hope. The original Magna Carta was created in response to a political crisis, challenging the autocracy and entrenching basic human rights. While we may have been equal on paper (at least to some extent) since its inking in 1215, wealth has allowed many to lead a very different existence for over 800 years. That existence has been one shrouded in a secrecy that few could afford to maintain.

Through a series of social and technological advancements this shroud increasingly has been pierced by the harsh light of the truth. This is a trend that I expect to continue. In fact, I expect that we will see a dramatic rise in whistleblowers over the coming decade.

I predict that the challenge for financial institutions will shift away from obtaining information and intelligence (we'll have more than enough). Instead, our efforts will be focused on ensuring that the intelligence that we have has been vetted and applied appropriately. Rather than merely asking for beneficial owner information, we will be looking for proof (perhaps even in the form of public records). Of course, there will always be those that look for ways to restore the secrecy that corruption requires in order to thrive. But I hope that fewer financial institutions will choose that ugly path.

Amber D. Scott is founder and chief AML "ninja" at Outlier Solutions Inc. Follow her on Twitter @OutlierCanada.