After $2 Billion Tax Fraud, Denmark Ratchets Up Its Defenses

The Danish government unveiled a sweeping array of new measures to fight tax crime, as it adds thousands of jobs over the coming years to ensure it never again becomes a target for international fraudsters.

Denmark “simply needs to be better equipped to combat cross-border tax fraud,” Tax Minister Morten Bodskov said on Wednesday.

The country is still trying to track down about $2 billion it says was stolen by international financiers claiming refunds on dividend taxes to which they weren’t entitled. Danish police have already charged hedge-fund founder Sanjay Shah for his alleged role in the fraud, and are now figuring out how to conduct a trial against the Dubai resident.

The measures unveiled on Wednesday are set to trigger a hiring spree as Denmark ratchets up its legal resources. The idea is to match the highly paid consultants who support “the biggest companies in their aggressive” tax planning, Bodskov said.

The strategy has three main focus areas: multinational organizations, digital platforms and investment innovations, as well as basic errors and fraud by corporations.

The strategy includes...

  • 2.7 billion kroner ($440 million) in funds and about 3,000 jobs over three years.
  • 85 people to be assigned to fighting complex and organized fraud, such as tax evasion tied to the use of havens, as well as “large, complex tax cases”; 1,000 staffers will monitor the legitimacy of tax claims.
  • 50 staffers will be tasked with focusing on “trends of the time,” such as tax evasion tied to the use of cryptocurrencies.
  • The proposal presented today is due to be presented to parliament on Thursday.

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