"we as a society cannot accept that our state treasury is exposed to it."
British financier Sanjay Shah has arrived in Denmark after being extradited from the United Arab Emirates (UAE) over tax fraud charges worth £1.4 billion.
Shah, who lives in Dubai, is accused of participating in fraudulent share trading schemes.
He was arrested by Dubai police in 2022 following an investigation into Solo Capital, a hedge fund that he founded.
It is alleged that Shah led a scheme which involved rapidly selling shares between investors in order to create confusion over who owned the shares at the time a dividend was paid out.
Tax on the dividends was subsequently reclaimed by multiple parties, however, it was only paid once.
Denmark is a country that has been hard-hit by so-called “cum-ex” schemes, although they flourished in Germany and Belgium.
The alleged fraudulent scheme ran from 2012 to 2015.
Shah denies the charges and insists that the trades were legal.
Danish authorities are seeking to recoup around £1.46 billion, nearly 0.5% of the country’s entire GDP.
Danish taxation minister Jeppe Bruus said:
“It goes without saying that we as a society cannot accept that our state treasury is exposed to it.”
He added that it is “one of the biggest criminal fraud cases in Danish history”.
Foreign Minister Lars Lokke Rasmussen said Denmark was “sending an important signal that you cannot achieve impunity by staying abroad”.
After the 2008 financial crisis resulted in Sanjay Shah losing his job, he founded Solo Capital and moved to the UAE.
He lived a lavish lifestyle in Dubai, which included living on the Palm Jumeirah island.
Shah founded an autism charity and musicians who played for the charity included Elton John and Drake.
He bought two yachts, naming them the Solo and Solo II.
But since 2020, Shah has been pursued by Danish authorities over the fraud charges. Much of his fortune, including a £15 million property in Central London, has been frozen.
His British lawyer, Chris Waters, said Shah denies any wrongdoing and “continues to doubt that he can receive a fair trial in Denmark”.
Shah’s Danish lawyer Kare Pihlmann said they needed to read the case file of more than 300,000 pages before deciding on their line of defence.
Officials said on December 6, 2023, Danish police officers travelled to Dubai to collect Shah.
Once in Denmark, he will be formally arrested and prosecutors will request that he be held in custody until the start of his trial, scheduled for January 8, 2024, in Copenhagen.
In a separate case in November 2023, Shah lost a bid in the UK Supreme Court to block Denmark from pursuing him in English courts.
British national Guenther Klar, who worked for Solo Capital between 2010 and 2012, went on trial in Denmark in the country’s first court case over cum-ex fraud.
Klar was extradited from Belgium and faced accusations of defrauding the government of around £37 million. He denies wrongdoing.
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