Cayman firms asked for info in Danish tax fraud

| 06/05/2020 | 14 Comments

(CNS): More than a dozen offshore corporate service providers from the Cayman Islands have been asked to provide information for a case going through the New York Southern District Court relating to an alleged $2 billion tax scam in Denmark. The tax authority there, Skatteforvaltningen (SKAT), is seeking discovery from firms here and in the British Virgin Islands in its pursuit of dozens of US pension plans it says have made and received fraudulent tax rebates from the Danish public purse

SKAT alleges they were not entitled to the tax refunds because the plans did not actually own the shares of the Danish Securities that they claimed to and didn’t earn the dividends. According to the court documents, the Danish authorities claim the scam was set up by Dubai-based British businessman Sanjay Shah.

While the suit involves dozens of US pension plans, the local firms here are not involved in the suit. But SKAT believes they were used to distribute the Danish tax refunds to the participants in the fraud to disguise the true beneficiaries.

Some of Cayman’s biggest names are now asked to provide documentary evidence of the work they did for the pension companies named in the suit.

They include Bell Rock Corporate Services, Campbells Corporate Services Limited, CO Services Cayman Limited, DMS Corporate Services, Forbes Hare Trust Company Limited, Genesis Trust Corporate Services Ltd, Harneys Services (Cayman) Ltd, Intertrust Corporate Services (C.I.) Limited, Ocorian (Cayman) Limited, Sterling Trust (Cayman) Limited, Trident Trust Company (Cayman) Limited, Vistra (Cayman) Limited and Walkers Corporate Limited.

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Category: Business, Crime, Financial Services

Comments (14)

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  1. mikey the otter says:

    how can an alleged fraud, be a crime ??? that is nonsensical…
    simply alleging this doesnt mean that its a crime…fraud by its very nature is complex and political, particularly when it comes down to tax codification …
    if you look back in time there are 1000s of tax cases that have caused the law to be amended and made clearer ….
    seriously …..zzzzzzzz

  2. Anonymous says:

    It is wondered whether attorney-client privilege and confidentiality will be claimed here. It seems that there has been a push to water down these obligations and will be interesting to see what comes of all this.

  3. Anonymous says:

    All the Cayman Islands has right now is Financial Services. We are already on the OECD Blacklist and one more failure and we’re done. Let’s not add to our troubles by not responsively providing the information sought, in this, or any other case where impropriety has been proven to have taken place. We also must start charging and trying white collar criminals who are in the business of willful blindness.

  4. Anonymous says:

    What CIMA needs to look into is what AML due diligence, source of funds and transactional structuring investigations were undertaken by these outfits before they took on the business.

  5. Anonymous says:

    LOL David Marchant always on point, skulking in the periphery (key words give alerts). Always love to read his posts. And that man is not afraid to post using his name.
    Let’s get the popcorn and see who replies!

    PS. David do not expect residents here to use their name to post. I hope you understand..

  6. Anonymous says:

    It’s called dividend arbitrage and it has been going on for decades. It’s was not illegal the last time I checked (perhaps it is in Denmark). it was phased out by the major banks for ethical reasons a while ago.

    Don’t go jumping to conclusions and calling everyone money launderers and criminals unless you know what you are talking about.

    • Meanwhile, back on Planet Earth, former London bankers Martin Shields and Nicholas Diable were not long ago criminally convicted for tax evasion in Germany concerning their participation in the scheme. As The Guardian reported, “… the judge stated that the trades were illegal rather than merely exploiting loopholes in the law.”

      Don’t go jumping to conclusions, indeed, that … er … crimes were not committed because … er … two people have already been criminally convicted and … er … it’s considered to be the tip of the iceberg.

      It should also go without saying that, if dozens of shell companies were created in Cayman alone (with no employees or bona fide operations) then … er … they were up to no good. This is what’s called ‘stating the obvious’.

      My firm, OffshoreAlert, had a session on this at our London conference last year. An audio recording of the presentation is available on our YouTube channel at

      David Marchant

  7. Anonymous says:

    Yes, by all means get CIMA on the case. They did a great job on First Cayman Bank.

    • Anonymous says:

      πŸ˜‚ πŸ˜‚ πŸ˜‚ πŸ˜‚ πŸ˜‚ πŸ˜‚ πŸ˜‚ πŸ˜‚ CIMA and taking action just don’t go together

  8. Jack Irvine says:

    Sanjay Shah has never been charged. He got legal advice the trades were permissible. The Danish tax authority -SKAT- are a laughing stock in Europe and the police spent a week in Dubai interviewing Shah and came away with nothing. The quicker Denmark settles the quicker they can sort out their dysfunctional tax system. It always helps to know the full facts.

    • So, by your logic, if you get legal advice before committing an alleged fraud, it’s, by definition, not a crime (chortle, chortle, snigger, snigger)? And SKAT “a laughing stock”? Maybe in your warped world but not in the real one. Sanjay Shah’s assets have been frozen and he’s being criminally investigated. That’s some result for him! Meanwhile, he’s holed up in Dubai and, no doubt, not planning to vacation in Europe any time soon. And two former London bankers have already been criminally convicted and their convictions are generally seen to be the tip of the iceberg. Apart from that, everything’s fine and dandy! It does, indeed, “help to know the full facts”. By the way, what do you think the dozens of Cayman shell companies with no employees or bona fide operations were up to? What substance do you think they provided?

  9. Anonymous says:

    We don’t want the alternative of providing too much information as once done with Australia..who then refused to destroy.

  10. Anonymous says:

    CIMA needs to quickly provide them with whatever they are entitled to under the law, MOUs, and ITEAs. Our regulatory dithering has been cited as continued obstruction by review agencies, and we must change that narrative completely. Chop chop everyone.

    • Anonymous says:

      “CIMA needs to quickly” you’re being funny right?

      CIMA and quickly aren’t usually found in the same sentence

      Took them 6 months to inspect the HSBC Mexico Cayman branch after they had been closed down by the US

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