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A British hedge fund dealer well-known for throwing extravagant events and internet hosting stars like Elton John at charity concert events has gone on trial for fraud.
Sanjay Shah is one in every of 9 British and US nationals accused of defrauding Denmark of $1.8bn (£1.4bn) via main tax evasion and avoidance schemes.
So-called co-ex schemes had been designed to use weaknesses in nationwide tax legal guidelines and targeted on giant share trades that had been made for the only real function of producing a number of refunds of tax paid as soon as. .
Mr Shah, founding father of London-based hedge fund Solo Capital Companions, denies any wrongdoing.
He has been detained in Denmark since being extradited to the nation following his arrest in Dubai in 2022.
Prosecutors alleged that Mr. Shah, the primary suspect within the case, fraudulently obtained dividend tax refunds from the Danish treasury via buying and selling schemes that flourished after the 2008 monetary disaster, Reuters reported.
So-called low-ex trades contain the sale of shares from one investor to a different instantly earlier than the fee of a dividend to shareholders (co-dividend, or ex-dividend), versus distributing them after the dividend date (ex-dividend). .
This follow enabled each events to assert a refund of the tax withheld – even when the tax, levied on dividends at supply, was paid solely as soon as.
To maximise potential income, elaborate constructions had been created whereby giant quantities of shares, usually borrowed, could possibly be handed in a round method between many alternative events. The constructions had been designed to take away market danger and conceal what was occurring.
The rip-off started gaining momentum in Germany within the early 2000s, till authorities there banned the follow.
It later unfold to different jurisdictions, notably Denmark. Britain was not a serious goal for the rip-off however lots of the trades themselves had been performed from London.
The Danish authorities has acknowledged that the co-exist schemes value greater than 12.7 billion Danish crowns ($1.8 billion) between 2012 and 2015.
Initially of Mr Shah's trial, prosecutor Mary Tulin requested the courtroom to grab his belongings price 7.2 billion Danish crowns, which included an inventory of properties largely within the UK.
He grew to become well-known for throwing extravagant events, whereas celebrities corresponding to Prince and Elton John agreed to carry out at concert events for the autism charity he based.