Hedge-fund founder Sanjay Shah, on trial for allegedly orchestrating a tax scam that cost Denmark £1.4 billion ($1.7 billion), denied any wrongdoing and said markets were envious when he treated himself to a Ferrari.
Testifying at a London court from a Danish prison via a video call, Shah insisted that his controversial so-called Cum-Ex trades were lawful and that any rumors circulated in the industry were merely due to jealousy.
“Our competitors and the markets didn’t actually believe we would be able to make money. We did make money. We made a lot of money,” said Shah. “I bought myself a Ferrari for my 38th birthday, and that news went around the market,” he added. “So there was a lot of jealousy, and I believed back then, and I still believe now, that the rumors and the bad mouthing was due to jealousy and nothing else.”
Christopher Pike/Bloomberg
Logging in from a bare, white room, Shah said he took advantage of loopholes and a “defect” in the law. “It’s a loophole, it’s not a perfect system,” he said. “If it was a perfect system, there wouldn’t be a loophole, and there wouldn’t be an opportunity like this to make money.”
Cum-Ex was a tax-driven trading strategy in which a global network of bankers, lawyers and agents used dividend payout laws across Europe to reap duplicate tax refunds. Roughly 1,800 people are still under investigation in Germany and a total of nine have been charged in Denmark.
Shah, who founded Solo Capital Partners, was accused of being a “mastermind” behind one of these schemes. In London, he is also being sued by the Danish tax agency known as Skat, along with dozens of traders and businesses, in a bid to claw back the billions of euros it says it was defrauded out of. He is also under trial in Denmark, where he was
“You asked me if I’m an honest man,” Shah said to Skat’s lawyers. “I believe that what I was doing at the time and those working for me, and clients, were doing everything lawfully, and following legal advice.”
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