The partners of the law firm at the heart of the Panama Papers scandal were given bail pending further legal action over allegations they helped launder money related to a huge Brazilian bribery case.

Juergen Mossack and Ramon Fonseca were freed on bail of $500,000 each, their lawyer, Marlene Guerra, told AFP.

They had been detained since February 9 in relation to an investigation over the money-laundering allegations tied to the bribery affair in Brazil, known as the "Car Wash" case.

That had to do with kickbacks to Brazilian politicians paid by big Brazilian companies, among them construction giant Odebrecht, which has admitted to paying nearly $800 million in bribes to government officials and political parties to win public contracts on three continents.

That matter was not directly related to the Panama Papers affair, which involved a massive data leak from the Mossack Fonseca law firm that revealed the secretive offshore entities used by many of the world's wealthy to stash assets. Some of the offshore companies were used to evade taxes and launder money.

Mossack and Fonseca have been accused of running a "criminal organization" permitting the laundering of assets related to "Car Wash."

Mossack Fonseca's representative in Brazil, Maria Mercedes Riano, is being detained in Panama. Brazilian prosecutors suspect she helped create offshore companies to facilitate bribe payments.

While Mossack Fonseca claim its Brazilian subsidiary acted with autonomy, Riano's lawyers argue that she was only following orders from headquarters in Panama.

Last week, Ramon Fonseca told AFP he considered himself a "political prisoner" and accused Panamanian prosecutors of psychological torture in a bid to coerce incriminating statements about "Car Wash."

He also said prosecutors were subjecting Riano to psychological pressure "so she testifies against us."

Until the Panama Papers scandal blew up, Fonseca was a close friend and adviser to Panamanian President Juan Carlos Varela.

Source: AFP