Canada's biggest bank is handing over to the government names of clients with "relationships or connections" to a Panamanian law firm at the centre of a massive leak of offshore financial data.
The Toronto Star and CBC, citing legal documents filed on Wednesday, reported that the Canada Revenue Agency had sought a court order against the Royal Bank of Canada (RBC) to compel disclosure and that the bank would not be challenging it.
Royal Bank confirmed the story.
"We respect the confidentiality of our clients within the bounds of the law, and we cooperate with all of our regulators," RBC spokeswoman Tanis Feasby said in an email.
The tax agency's action came about one month after the Star and CBC, in partnership with the International Consortium of Investigative Journalists, published their investigations on the law firm, Mossack Fonseca.
Leaks from the Panama-based law firm, dubbed the "Panama Papers," have embarrassed several world leaders and shone a spotlight on the shadowy world of offshore companies.
Governments across the world have begun investigating possible financial wrongdoing by the rich and powerful after the leak.
The Canada Revenue Agency on Thursday (local time) said that based on its own sources of information, it had already initiated 40 audits related to Mossack Fonseca prior to the Panama Papers release.
"Through more recent efforts, the CRA now has tens of thousands of records from multiple sources," CRA spokesman Philippe Brideau said in an email.
"The agency will use this and any other data collected from its various sources to ensure that all Canadian taxpayers identified from the Panama Papers are pursued."
RBC last month said it was reviewing its records after being named in leaked documents and told Reuters that it had controls in place to prevent illegal activities and it would not do business with those who evaded tax.
Canada last month said it was closely watching the cases of citizens found to have set up offshore companies in Panama and elsewhere and would refer cases to prosecutors if necessary.