With Sanjay Shah as the mastermind, a global network of bankers, lawyers and financial agents illegally sought refunds on dividend taxes they never paid, on stocks they never owned. Image Credit: Courtesy: Dubai Police

Dubai: Dubai Police arrested Sanjay Shah, the main suspect in the biggest tax fraud and money laundering case in Denmark.

According to Dubai Police, British national Shah was arrested in Dubai over $1.7 billion (Dh6.2 billion) of tax fraud and money laundering cases in Denmark.

Dubai Police received a red warrant to arrest Shah. He will be extradited to Danish authorities.

The arrest follows close cooperation between the UAE and Denmark under a bilateral extradition treaty signed in March 2022. Shah was charged with defrauding Danish tax authorities of multi-billion dollars through the ‘cum-ex’ trading schemes.

Vital communication channels

Lieutenant General Abdullah Khalifa Al Marri

Lieutenant General Abdullah Khalifa Al Marri, Commander-in-Chief of Dubai Police, said Dubai Police were always keen on maintaining strong, active and vital communication channels with police departments across the globe, to tackle organised crime, including financial crimes and fraud.

“Sanjay Shah was placed under intensive monitoring after the force determined his location, in coordination with Dubai Public Prosecution,” said Lt Gen. Al Marri. He praised the efforts of Dubai Police officers in arresting of Shah.

According to Dubai Police, the international arrest warrant was received from Danish authorities through the Ministry of Justice, represented by the Department of International Cooperation and Dubai’s Public Prosecution. Shah was the main suspect in a tax fraud case in Denmark worth 12 billion Danish krone ($1.7 billion).

Shah established multiple shell companies to claim tax refunds. A global network of bankers, lawyers and agents illegally sought refunds on dividend taxes they never paid, on stocks they never owned. Danish authorities said Shah was the mastermind of the scam.

Charges of dividend-tax fraud

Brigadier Jamal Al Jallaf

Brigadier Jamal Al Jallaf, Director of the Criminal Investigation Department in Dubai Police, said Shah, along with others, were facing charges of dividend-tax fraud and money laundering. “The fraudulent scheme, known as ‘cum-ex’ trading, involved submitting thousands of applications to the Danish Treasury on behalf of investors and companies from several countries around the world in order to receive tax refunds,” said Al Jallaf.

He added that Sanjay Shah would be handed over to Danish authorities after presenting him before Public Prosecution in Dubai and following necessary legal procedures to obtain his extradition warrant under international laws in this regard.

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Under constant surveillance

Major General Khalil Ibrahim Al Mansouri

Major General Khalil Ibrahim Al Mansouri, Assistant Commander-in-Chief for Criminal Investigation Affairs, Dubai Police, added that after exchanging information with Danish authorities on 52-year-old British national Shah, a task force was established by Dubai Police to investigate, gather evidence and track the suspect’s movements in UAE. “A team from the Wanted Persons Department and the Anti-Money Laundering Department put Shah under surveillance until he was arrested,” Maj. Gen. Al Mansouri said.

Who is Sanjay Shah?
Sanjay Shah lost his job during the financial crisis more than a decade ago. He was one of thousands of mid-level traders who suddenly went out of work.
However, Shah didn’t take long to get into gaming the legal and financial systems, setting up his own funds and targeting gaps in the dividend-tax laws.
In 2020, Danish authorities froze many of Shah’s assets, including a £15 million (Dh69.18 million) home near Hyde Park in London.
British national Shah had moved to Dubai in 2009.