Tax Dodging / Avoidance / Offshore / Dodgy Schemes / Players

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More from the Eye on dodgy owners of UK property , and their sources of wealth ... Government crackdown on money laundering " Continues " as I type :


http://www.private-eye.co.uk/in-the-back


The UK’s houses of ill repute.

Unexplained wealth orders, Issue 1465


THE National Crime Agency (NCA) last week deployed a new anti-corruption weapon for which there are high hopes: the so-called “unexplained wealth order”. It designated two properties, worth £22m and held by an unknown eastern European, as probably acquired from dirty money.

Investigators will now demand an account of where the dosh came from with a view, in the absence of a satisfactory explanation, to confiscation. Whether this heralds a new front in the war on kleptocracy or just a shrewd PR move at the launch of a new policy remains to be seen; but the Eye – which has exposed the extent of prime property ownership through offshore companies as a key money-laundering device – has identified several more the authorities might want to look at under their new powers.

Goodluck Jonathan, former president of Nigeria, and his wife Patience appear to be behind a £4.5m mansion called “Hillside” on the St George’s Hill estate in Weybridge, Surrey (Eye 1438). The property was acquired via BVI company Transocean Group Holdings.

Jonathan’s compatriot, Folorunsho “Folly” Folarin-Coker, former head of the number plate production authority in Lagos, resides at a Georgian townhouse in Chelsea that was acquired for £2.4m in 2010 – while Folly held office – via Marshall Islands company Express Holdings Ltd.

Alleged bribery

Fassine Fofana, the former oil and mining minister of Guinea, resides at a townhouse in Wimbledon, south-west London. The property was acquired in 1999 – while Fofana held office – for an undisclosed sum (doubtless worth a few million today) via BVI company Kensington Invest & Trade SA. According to a private intelligence report published by WikiLeaks, Fofana allegedly paid bribes to decision-makers in the Ghanaian government between 2008 and 2009 on behalf of Norwegian oil company, Perennial Bioenergy AS.

Ahmad Ali al-Mirghani, the former president of Sudan who was deposed in a military coup in 1989 and died in 2008, still holds the leasehold over an apartment in Raynham, a London apartment block near Hyde Park. The property – likely to be worth several million pounds today – was acquired in 2007 via BVI company Orange Star Corporation.

Volodymyr Galanternik, a Ukrainian mafia boss, resides at an apartment in The Knightsbridge, a luxury apartment block near Harrods. The apartment was acquired in 2015 for £4.6m via Isle of Man company Piantoon Ltd. Eye 1458 revealed how the Paradise Papers showed that Galanternik – a close crony of mobster mayor of Odessa Gennadiy Trukhanov – lurked behind scores of dubious UK “limited liability partnerships”.

Dubious commissions

John Bredenkamp, a Zimbabwean arms dealer, resides in a townhouse in Chester Square, Belgravia. The property was acquired in 2009 for £2.5m via BVI company South Compass (Ptc) Ltd. Bredenkamp was named in Serious Fraud Office (SFO) documents as a recipient of £24m in dubious commissions between 2000 and 2005 from British arms behemoth BAE Systems on a deal to sell Saab fighters and Hawk trainer jets to the governments of South Africa and Tanzania. BAE paid Bredenkamp via accounts at LGT Bank in Liechtenstein and First Curaçao International Bank in Holland.

Another fixer cut into that deal was Nabil Hijazi, a former UAE diplomat who has a mansion in Holland Park, west London, and is the shareholder of the company that owns it. The property was most recently acquired for £19m in 2016, via BVI company NH Nominees (PTC) Ltd. Hijazi – described by subjects interviewed by the SFO as “instrumental” in BAE’s bribery-laden Al Yamamah arms deal – received £8m from BAE Systems between 2000 and 2002 via an account at LGT in Liechtenstein.

Another arms dealer, Christian Michel, resides at a townhouse in Chesham Street in Chelsea. The property was acquired in 2010 for £2m by BVI company Joylyn Investments Ltd. Michel is named in Italian court documents as a key intermediary in a £400m deal to supply helicopters to the Indian government. He is alleged to have funnelled bribes totalling €30m from Anglo-Italian chopper-maker AgustaWestland to decision-makers in the Indian military.

In January, Transparency International listed a further five suspicious UK property owners, including Russian deputy prime minister Igor Shuvalov and the family of Azerbaijani president Ilham Aliyev. Dozens of others connected to Saudi Arabia and Gulf states could be included if simply having the right family connections is deemed not a good enough explanation of vast wealth. The success of UWOs will depend not just on the capacity of law enforcers such as the NCA and SFO to implement them, but also on the political appetite for upsetting such individuals – especially from a government whose international trade minister Baroness Fairhead recently visited Baku to schmooze Aliyev for post-Brexit business.



Yes ... that right folks ... our Government is committed to prevent money laundering and take action against those who profit from it.

Note the continuing use of " British overseas territories " as the vehicles for such practices.

As posted earlier , most of the top 100 PLCs in the UK have " British overseas territory " subsidaries / associates through which both sales and profits are passed ( " Laundered " ) so as to minimise their UK tax liabilities.

If one were to strip out their political contributions , virtually all our political parties would be insolvent.

The words GOOSE and GOLDEN EGG spring to mind ?
Oh dear , an article with a very just reward ?


http://www.bbc.co.uk/news/uk-england-leeds-43434366

HMRC adviser Amjad Khan jailed for £40,000 tax fraud.


An Inland Revenue adviser who did not pay income tax for 13 years has been jailed, with a judge saying sparing him from custody would cause "outrage".

Amjad Khan, 38, failed to pay almost £16,000 between 2002 and 2015 while working for the HMRC in Bradford.

He also pocketed nearly £24,000 in tax credits to which he was not entitled as part of the "appalling and blatant" fraud.

Khan admitted the fraud offences at Bradford Crown Court last year.

At the same time as he was working for the HMRC in Bradford city centre, the married father-of-three was also earning money through a property rental business and his work as a self-employed gas and heating engineer.

" Public would be outraged "

Prosecutor Howard Shaw said Khan of Burnett Avenue, Bradford, had claimed in a tax return for the year 2014/15 that both his businesses were loss-making even though analysis of his bank accounts showed they were profitable.

Defence barrister Emma Downing said a constructive alternative to immediate custody could include unpaid work for the community.

However, the Recorder of Bradford, Judge Jonathan Durham Hall QC, said all the time Khan had been working for HMRC advising people about their "rights and wrongs" he had been committing fraud against the state.

"You were evading income tax over a 13-year period," said the judge, who described the frauds as "appalling and blatant".

The judge said a 20-month prison sentence would have to be served and the public would be outraged if the court did not deal with Khan in a robust way.

Khan is expected face a further hearing under the Proceeds of Crime Act later in the year in bid to get back the money he obtained through fraud.


Nice to see this one got his collar well and truly felt !!!

Bring on the next hundred thousand or so !!!
Another case of a black hole in a company's finances brewing ... as the business collapses with a defecit on their pension fund.


http://www.dailymail.co.uk/money/news/a ... lions.html

The hunt for Toys R Us' missing millions: Investigators probe a £580m loan moved to a tax haven just months before the store went bust

Pensions officials previously probed the transaction but it remains a mystery
There will now be a full investigation of Toys R Us’s financial affairs
It is currently beginning to close all its 105 stores and make 3,000 staff jobless.


Investigators are in pursuit of more than £580million that was funnelled out of Toys R Us’s UK business and into a tax haven on the British Virgin Islands.

Accountants and hedge funds are understood to be on the trail of the cash – a loan that was handed over by the British arm of the toy retailer just months before it went bust.

Administrator Moorfields Corporate Recovery is preparing for a full investigation of Toys R Us’s financial affairs as it begins to close all its 105 stores and make 3,000 staff jobless.

Investigators are in pursuit of more than £580million that was funnelled out of Toys R Us’s UK business and into a tax haven on the British Virgin Islands.

Accountants and hedge funds are understood to be on the trail of the cash – a loan that was handed over by the British arm of the toy retailer just months before it went bust.

Administrator Moorfields Corporate Recovery is preparing for a full investigation of Toys R Us’s financial affairs as it begins to close all its 105 stores and make 3,000 staff jobless.

It said the investigation will include determining why Toys R Us funnelled the £584.5million loan into an offshore subsidiary and then waived repayments.

Although pensions officials have previously asked company chiefs about the transaction, it remains a mystery.

Documents seen by the Mail reveal US hedge fund Blue Mountain Capital is chasing the money held in the British Virgin Islands as a way of making up for losses it suffered after the collapse of the American arm of Toys R Us.

If it proves successful, the hedge fund – once run by Barclays boss Jes Staley – will get its hands on the cash which may have been stripped from the UK arm.

Toys R Us hit trouble last year when its US parent filed for Chapter 11 bankruptcy protection after revealing it had £3.7billion worth of debt.

Months later, the UK business admitted it had run into financial difficulty and announced plans to close a quarter of its 105 stores.

If it proves successful, the hedge fund – once run by Barclays boss Jes Staley – will get its hands on the cash which may have been stripped from the UK arm.

Toys R Us hit trouble last year when its US parent filed for Chapter 11 bankruptcy protection after revealing it had £3.7billion worth of debt.

Months later, the UK business admitted it had run into financial difficulty and announced plans to close a quarter of its 105 stores.

The retailer agreed to pay £9million into its pension fund and continue trading over the crucial festive period. But it was forced to admit defeat and is getting ready to shut all its stores over the next few weeks, which will leave thousands of staff out of work.

Tax experts have called for an investigation into the company’s finances after its accounts revealed the write-off of the £584.5million loans to a company based in the British Virgin Islands, a territory commonly used by companies for tax avoidance purposes.

The loans first appeared in company accounts in January 2017, and appear as sums of £92.5million plus interest, and £461.4million plus £25.6million to TRU (BVI) Finance II.

It states that these payments were waived – suggesting the money handed to the British Virgin Islands and the interest that should have been paid by the company to the UK, had been given up on.

This is significant because of the £38million pension deficit at Toys R Us.

The scheme is set to fall into the Pension Protection Fund and members could lose up to 10pc of their incomes.

Prem Sikka, professor of accounting and finance at the University of Sheffield, said at the time: ‘Why on earth did they have all these subsidiaries based offshore? The straight answer is that it offers it a degree of secrecy and confidentiality.’


A spokesman for Toys R Us said: ‘These were non-cash transactions between the UK holding company and its wholly owned subsidiary in the BVI.

‘They had no impact on the financial position of the UK trading company and the move was part of a broader effort to simplify the UK group structure.’


The chase is now on !

British Virgin Islands ... in the frame yet again.
Watch out if you are running a dubious tax avoidance sheme :


https://www.telegraph.co.uk/tax/income- ... avoidance/


Taxman and advertising watchdog get tough on dubious tax avoidance schemes.


The taxman has teamed up with the advertising watchdog to crack down on companies touting schemes to avoid tax.

The complicated arrangements, which often involve a bewildering array of loans or shell companies, offer to limit their user’s liability for income tax, national insurance or stamp duty. HM Revenue & Customs is active in challenging them, saying these “tax avoidance” plans aren’t likely to hold up to scrutiny.

But now it seems to be trying out a new tactic. Rather than attempting to close the schemes down, HMRC is reporting firms that make spurious claims about tax mitigation to the Advertising Standards Authority (ASA).

The watchdog yesterday published its ruling on a company called CDP Tax and Wealth, which trades under the name Fiducia Wealth and Tax. The firm’s website claimed the scheme would “save you a minimum of 60pc” on stamp duty and that the company was endorsed by the Solicitors Regulation Authority.

The ASA ruled that both these claims should be removed.

Telegraph Money first warned of the dangers of the scheme offered by CDP Corporate in July 2016. Last year this newspaper reported a reader had been left with a bill of £75,000 from HMRC after using this failed arrangement.

The company is now in liquidation, but was owned by the same group of people as CDP Tax and Wealth.

The company insisted its new scheme was based on "specialist tax and legal advice" and said HMRC has requested information relating to a "small number of clients", with which it has complied.

A spokesman added the firm would comply with the ASA ruling, and its website has been taken down while changes were made.


A statement read: "The wording of that ad was never intended to and could never explain the full detail of the planning concerned. Everyone who made contact with us having seen it was made completely aware of the possible element of risk involved and that was also made clear in all our relevant literature."

Dan Neidle, a tax partner at Clifford Chance, the law firm, said he had also reported Fiducia to the ASA after being shocked when he saw the advert. He described the firm’s offer as “nothing short of a scam”.

He added: “Schemes like this have essentially no chance of working and I think all responsible tax practitioners would say the same.”

Jessica McLellan, a specialist at Blick Rothenberg, the accountants, said HMRC is becoming “increasingly sophisticated” in challenging scheme promoters. “By involving other regulatory bodies, they are accessing a wider range of punitive powers,” she added. “This is a positive move by HMRC to impact the commercial activities of avoidance promoters in an innovative way.”

HMRC said most schemes offering to reduce your tax liability don’t work and that using the ASA was just one of the weapons at its disposal. A spokesman said the taxman has reported three “avoidance promoters”.

He added: “We are delighted that they have agreed the adverts were misleading in all three cases. These rulings set precedents, so other avoidance promoters can’t make the same claims about similar arrangements.”

Last month the ASA ruled that a Surrey-based accountancy firm called Williams Gordon could no longer claim contractors could “take home up to 92pc of your pay” or that its arrangements were “legally robust”.

However, yesterday the firm’s site still included the initial claim, along with further claims about the compliance of the scheme. Mark Turner, of Williams Gordon, told Telegraph Money this was an oversight and was in the process of being removed.

The ASA has a compliance team which works with firms subject to a ruling to ensure they can alter any advertising within a reasonable time frame. It has the power to report firms to Trading Standards which can levy fines.

Last year HMRC reported another firm, Knight Wolffe, for claiming users of its income trust scheme could pay 80pc less tax. This complaint was also upheld by the ASA.



Minimising tax is one thing , using schemes to do so , whilst untested in a Court of Law , another.

Bear in mind most workers have no option other than to pay their full share of income tax if on the PAYE system.

Fun begins when Joe Bloggs substitues himself for " Joe Bloggs Limited " as the employee.

Then , the real fun can begin.
Another one from The Eye , this time a " Well known " face taking advantage of the Law relating to companies entering administration at the expense of others :


http://www.private-eye.co.uk/issue-1466/in-the-back

A meaty recipe for indigestion.


SOME of multimillionaire TV chef Jamie Oliver’s claims to high ethical standards and valuing small local producers are ringing a little hollow to those suppliers left out of pocket by the collapse of his Barbecoa meaty restaurant venture.

Oliver opened the first Barbecoa near St Paul’s Cathedral in 2010 and set up a new one on Piccadilly last year, by which time his ex-City trader brother-in-law Paul Hunt had been running his restaurants for three years. The later Barbecoa didn’t fare too well, and last month the company that owns the restaurants, Barby Ltd (owned by Oliver), was placed in administration.

Unpleasant taste

Since Piccadilly was the basket case, the chirpy chappy neatly set up a new company, One New Change Ltd, to buy up the viable St Paul’s outlet under a so-called “pre-packed” deal. Such arrangements are controversial at the best of times, as they can leave owners with the juicy assets and creditors in the lurch. But when they are executed by somebody worth £150m (according to the Sunday Times Rich List), they leave a rather unpleasant taste.

While Oliver has agreed that his wider business empire will fund the redundancy payments of 78 staff losing their jobs, Barby Ltd’s administrators say that around 150 unsecured creditors can expect to receive less than 1 percent of what they’re owed. This leaves a wide range of organisations, companies and traders out of pocket. So the Westminster council taxpayer is deprived of £493,000, while a host of small producers, craft breweries and other suppliers are left with four- and five-figure losses. One told the Eye it was a “bit galling”.

Total unpaid debts will come to around £6.5m, including £3.5m owed to HSBC bank, or around 4 percent of Oliver’s reputed wealth. That’s a pukka deal for a celebrity chef, but one that leaves plenty of others burnt.


Nothing illegal in the above , just the way the Law works.

Some of the football clubs amongst the 92 have done exactly the same ... Leicester City in days gone by for instance.

Perhaps those amongst the unsecured creditors , relying on this face's reputation and stated wealth , would argue otherwise ?
Oh dear , premier league footballers caught with an open goal at their mercy ?


https://www.mirror.co.uk/sport/football ... s-12334666

Nearly 130 Premier League stars face £250 MILLION bill after ploughing cash into tax avoidance scheme.

A household name Manchester United star funnelled £33.5million of his own cash and a bank loan into the Kingsbridge scheme, but the taxman is now trying to claw back at least 70% of the amounts put in.


Footballers who ploughed their cash into a tax avoidance scheme could face financial ruin if hit with massive bills to repay the money and fines.

One former Manchester United star invested £33.5million, a mix of his own cash and a bank loan, in a movie-based project that allowed him to significantly reduce the duty he paid on his Premier League salary.

The household name is one of 129 top players who put a total of £250million into the scheme through ­financial advisers Kingsbridge.

Other clubs with high-profile investors included Liverpool – where one paid £10.4million in cash and loans – Aston Villa and Blackburn Rovers.

Kingsbridge staff earned huge bonuses on the back of the payments.

HMRC is now trying to claw back at least 70% of the amounts put in, plus interest and penalties.

It means players face bills similar to their original investments as income paid back to the scheme from the films was taxable.

Critics claim the players knew they were avoiding tax. But experts claim the stars had little or no idea how their money was being used.

nvestor Rescue Organisation founder Stuart Cotton said: ­“Footballers have been demonised over years for investments into tax avoidance schemes.

“The truth is most were not privy to how the arrangements work. The result of investing in such schemes is beyond comprehension at times.”

XPro, which supports former ­footballers in debt matters, insisted the responsibility lies with scheme promoters and banks, who provided the loans.

A source said: “There is a deep sense of shame attached to this group.

“They are high-profile figures, ­international footballers. None of them knowingly embarked on a plan to pay less tax.

Julia Norris, of Manchester-based FS Legal, said the players should have been told schemes were “very high risk” and warned some now face “financial extinction”.

She added: “Where investors try to reduce their tax bill, some might say they got what was coming.

“But many were going to pay any money owed down the line, plus interest. They are not tax dodgers. They are tax delayers.

“One man placed £300,000 of his own money, plus a £7million loan. He now has a £7million tax bill.

“It was sold to him as a cash flow advantage, it is not the evil tax dodge as so often portrayed. Advisers were usually on commission on any loans, plus fees, so did very well indeed.”

But a spokesman for former ­Kingsbridge advisers David McKee and Kevin McMenamin insisted clients “without exception” were made aware of the ­products in which they were investing.

He added: “They were clearly advised in relation to commission arrangements.”

HMRC removed the tax break in the late-2000s. Some investors formed a group to take action against ­Kingsbridge – which went into ­liquidation in 2015 – and the banks involved in the schemes.

HMRC said: “Most tax ­avoidance schemes don’t work. People can end up paying more than they were trying to avoid.”

How it works

The schemes offered tax relief on money invested in the film industry, into films such as Disney’s Enchanted.

They were popular from 2000-2004, when the Labour government backed British movie makers with tax breaks.

Kingsbridge advisers David McKee and Kevin McMenamin offered financial management to footballers and agents.

The film schemes also attracted other celebrities and business tycoons.

An investor might be asked to pay £100,000 into the scheme. That would be boosted by a bank loan of £900,000, taking their total investment to £1million.

They could delay paying tax on all of this money for the duration of the scheme, often 15 years.

Experts say HMRC then removed the tax breaks, but claim advisers kept on recommending the schemes.

Solicitor Julia Norris told how one property investor put in £300,000 but faces a £7million tax bill as loans took his investment to around £10million.

It was sold as a “cash flow advant­­age”, with the investor eventually paying the tax. But HMRC argued it was a sophisticated means to avoid tax.
Rich, pampered stars pounced upon by sharks

By Andy Dunn, Chief Sports Writer

Whatever happens to Manchester City in tomorrow’s Champions League showdown with Liverpool, their players will not be undernourished.

For the likes of Kyle Walker, Ilkay Gundogan and Kevin de Bruyne, dinner at home is often created in their own kitchens by a Michelin-starred chef.

The idea top footballers have EVERYTHING done for them is only the slightest of exaggerations, trust me.

Players are assets, why give them the distraction of paying their Council Tax themselves when they could be thinking about 4-3-3? It is like that, seriously.

And the profession is so competitive, the rewards so vast, footballers want to concentrate on one thing only. Playing.

That is why they will hand over their financial affairs to whoever comes highly recommended.

Look, the buck stops with these indulged, pampered players, or ex-stars.


Whatever team you support , everyone will be supporting our HM Revenue & Customs in this match ?
A little beaut from The Eye from their " Number Crunching " section ... updated almost daily on the web edition :

Number Crunching

200,000

Signatures for Daily Mail petition demanding the new blue British passport be made by a British, not French, company

20,000,000

Ordinary shares in Daily Mail and General Trust plc through which Lord Rothermere controls the Mail via a Bermudan company and offshore trusts to take advantage of his domicile in. .. France
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