Iceland's nine-month-old, center-right government collapsed Friday after a small coalition member quit over an attempt by the prime minister's father to help clear a convicted pedophile's name.
The centrist Bright Future Party said in a Facebook post that there was "a serious breach of trust" behind its departure.
Prime Minister Bjarni Benediktsson took office in January with his Independence Party, the Reform Party and the centrists.
Together the three parties hold the slimmest of majorities — 32 of the 63 seats in parliament following the Oct. 29 elections that were called after the former prime minister resigned amid protests over his offshore holdings, revealed in the Panama Papers leak.
The Bright Future party has four seats in Iceland's parliament, the Althingi.
Benediktsson's father, Benedikt Sveinsson, had helped a convicted child molester apply for a clause within Iceland's judicial system allowing a person who has served their sentence for a serious crime to "restore their honor" and seek employment again.
In 2004, Hjalti Sigurjon Hauksson was convicted of raping his stepdaughter almost every day for 12 years, and sentenced to five years in prison.
When it came out that some government members, including its head, had kept information from the public about a letter seeking to expurge Hauksson's record, the Bright Future party said it was quitting.
It is unclear whether Benediktsson, a former finance minister who was also named in the Panama Papers as having held a stake in a Seychelles-based investment company, will seek to form a new coalition or will call early elections.
A wind-lashed volcanic island near the Arctic Circle with a population of 320,000, Iceland suffered years of economic upheaval after the country's debt-swollen banks collapsed during the 2008 global financial crisis.