Denmark’s Tax Authority (SKAT) victorious in a four-year legal battle over illicit tax refund scheme. British Hedge Fund Trader, Sanjay Shah, loses Appeal in Danish Tax Fraud Case; Ordered to pay US$1.7 Billion by Dubai Court.
The Dubai Court of Cessation has issued a final, irrevocable ruling against British Hedge Fund Trader, Sanjay Shah, in a civil case brought by Danish Tax Authorities (SKAT).
The verdict orders Shah and others to pay Denmark’s Tax Authority Dh4.643 billion (US$1.7 billion), plus a 5% interest accrued from when the case was first lodged in August 2018.
“This conclusive ruling after a nearly five-year pursuit of justice, underscores the serious and uncompromising stance of the UAE Authorities against financial misconduct”, stated Sherif Hikal, Founding Partner, OGH Legal, acting on behalf of the Danish Authorities in the UAE.
“The process of execution in terms of how this money will be paid back to SKAT, has already been initiated.”
Sanjay Shah, the central figure in this fraudulent scheme, was involved in orchestrating foreign businesses to feign ownership of shares in Danish companies and unlawfully claim tax refunds.
In July 2018, a month before the case’s inception, Dubai Authorities had issued an asset freezing order against Shah and others.
This ruling reinforces an earlier decision by the Dubai Appeal Court last September, which found Shah and his accomplices guilty of illicitly extracting money from SKAT between 2012 and 2015, using a network of 126 fictitious companies.
According to the verdict, Danish Authorities were seeking to recover an amount of Dh7 billion from Shah and his associates.
The background of the case
The comprehensive case file, encompassing over nine million documents, has been meticulously examined over the course of this prolonged legal battle. Initially, the Court of First Instance dismissed the claim in August 2020, prompting an appeal. In March 2021, a court-appointed panel of three experts was tasked with dissecting the case. Their report revealed several foreign businesses were implicated in the scheme, and tracked the fraudulently obtained money deposited in their accounts. This led to a ruling in favour of SKAT in September last year which was taken by Shah lawyers to the Court of Cessation.
On Tuesday morning, the highest Dubai Court upheld the earlier verdict by the Appeal Court, by which Shah is ordered to pay back SKAT Dh4.643 billion (US$1.7 billion).
Adding to Shah’s legal woes, the Dubai Court rejected his final appeal against deportation in April 2023. He is now waiting to be extradited to Denmark to face prosecution over the alleged tax fraud.
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