More Traders Likely Face Charges in Danish Tax Investigations
19 Jan 2021

Danish prosecutors who charged hedge-fund manager Sanjay Shah with running a $1.6 billion tax fraud say they’re looking at a “number of other suspects” in the case.

Prosecutors said they’ll be in a position by March to decide whether to press charges against more members of a network that they say was set up to defraud the government in the biggest and most complex tax case in history.

Prosecutors still need to finish some of their investigation, including interviewing “several people,” Per Fiig, acting head of the State Prosecutor’s Office, said in an interview.

Denmark is one of several countries cracking down on trading schemes that reaped billions of dollars by claiming duplicate refunds on dividend taxes. Germany, Belgium and the Nordic country are all trying to extradite financial professionals in relation to the controversial strategy.

“We have had a hard time finishing because of Covid, but we expect to be done in the next couple of months,” said Fiig, whose office has grown by 100 to manage the case and a money-laundering scandal at Denmark’s biggest bank, Danske Bank A/S.

Danish prosecutors have three primary investigations into groups stretching from the U.S. to Malaysia that they say illegally claimed dividend tax refunds of around $2 billion. They’ve frozen assets worth around $485 million, including Shah’s $20 million London home.

“We are investigating, along several tracks, several people who formed a loosely knit network,” Fiig said. Regarding the other tracks, “it will take longer before our investigations show whether there are grounds for raising formal charges.”

Shah, who founded a London hedge fund that specialized in Cum-Ex trades, was one of two Britons charged earlier this month. Prosecutors allege he was the central figure in the $1.6 billion arm of the scam that hit Denmark.

Now living in Dubai, Shah has said he’ll show up in court to prove his innocence. Still, Fiig said the agency is working with “all the tools we have” to ensure that the suspects, whom SOIK declined to name, “stand before a judge.”

By Frances Schwartzkopff and Ellen Milligan, Bloomberg, 18 January 2021

Read more at Bloomberg

Photo (cropped and edited): TheTroothFairy, CC BY-SA 4.0, via Wikimedia Commons

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