Quist defends telecommunications company against unfounded allegations

May 2015

Quist fights a determined, lengthy and aggressive battle on behalf of a telecommunications company against the British authorities

Quist have represented a company and its directors over a period of 6 years in the context of the seizure and forfeiture of cash on the grounds of serious money laundering allegations (under the Proceeds of Crime Act 2002).

Despite a vigorously fought legal battle the Court of First Instance found that the monies seized were the proceeds of systematic tax evasion and that the directors had also circumvented a High Court freezing order. The freezing order captured their business and personal assets.

The realities were that the seized funds were the proceeds of legitimate business activities and were largely destined for expenditure in the course of a major overseas telecommunications project.

Quist’s clients also ran an associated successful telecommunications business which operated from London. This business was the subject of additional intense investigations and litigation pursued by the tax authorities. Claims related to £57 million worth of allegedly suppressed invoices.

The litigation commenced by the tax authorities was robustly resisted for over a period of 6 years whilst wholly unfounded claims for fraud were being maintained.

Ultimately, the European Court ruled on the tax matters in issue which forced the tax authorities to review their position. The appeal addressed a technical analysis of how and when sales tax was triggered on supplies made by traders along a chain that stretched across several jurisdictions and the applicability of a reverse charge procedure (the levying of sales tax on imported services).

The tax claims were settled for less than 1 percent of the original claim. The freezing order against Quist’s clients was also successfully discharged.