BHS: Tina Green denies family firms are based offshore for tax reasons

The wife of retail tycoon Sir Philip Green has defended their use of companies based in tax havens, praising their “strong regulatory regimes”.

Tina Green provided details of what has been described as the “complex web” of companies behind the family’s retail empire in a written response to MPs investigating the collapse of high street retailer BHS.

Lady Green, who is based in Monaco, gave details of 11 companies in which she or her wider family hold the controlling stake, with the majority incorporated in Jersey and the British Virgin Islands. However, she claimed the choice of jurisdiction was not related to the benevolent tax regimes.

“My understanding is that jurisdictions such as Jersey and the British Virgin Islands are commonly preferred for their strong regulatory regimes and well-respected regulators and the size and competence of their professional communities,” she wrote. “For the avoidance of doubt, my husband is not, nor has he ever been, a director or a shareholder of any of the non-UK companies referred to.”

The committee, jointly chaired by the MPs Frank Field and Iain Wright, wrote to Lady Green last month after evidence from advisers and executives linked to the BHS scandal raised fresh questions for the couple, who sold the department store chain to a serial bankrupt, Dominic Chappell, for £1 last year. The Greens have an estimated £3.2bn fortune.

The collapse of BHS in April also led to Philip Green being called before MPs to explain how the business had been left in such a perilous state. His wife was not called before the parliamentary inquiry.

At that time Wright said the evidence pointed to a “complex and very opaque web of privately owned family businesses” that helped make the deal possible. “We are keen to follow the money and look forward to Lady Green in her capacity as owner and ultimate beneficiary of these companies writing to us,” he said.

In her letter Green confirmed that she had been resident in Monaco since 1998 and was domiciled there. She also revealed income of £28.2m in the year to 30 September 2015, from the repayment plus interest of a £200m loan raised by one of the family companies to finance the purchase of BHS. The fixed-rate loan notes, which attract interest of 8% a year, are listed on the Channel Islands Stock Exchange.

Field said of Lady Green’s response: “I am not much closer to understanding the complex web of offshore Green companies but I am intrigued to learn that, while the attraction of Monaco is its fine schools, the British Virgin Islands and Jersey are favoured for their robust regulatory regimes.”

“What is clear, however, is that Green was paid £28m offshore, in the latest accounting year, for the acquisition of BHS by Taveta, another family company,” he added.

Field said there would be no more hearings before parliament breaks for the summer, but that it would soon publish its interim report.

Philip Green, who together with other investors collected more than £580m in dividends, rent and interest payments from BHS during his 15 years in charge of the retailer, told MPs during his appearance before the inquiry that he would “give assurance to the 20,000 pensioners that I am here to sort [the pension deficit] in the correct way”.

The scheme, which is being assessed for a bailout by the state-backed Pensions Protection Fund, has a £571m deficit. Field said it had asked Lady Green for additional information, including the minutes of board meetings and tax certificates on payments made to the Green family as it tries to get to the bottom of the affair. “This is just the beginning,” he said.

Earlier this week, Chappell defended his role in the collapse of the retailer, which had 11,000 staff, telling Newsnight his consortium had taken a chance on BHS. “We were the only people to stick our heads above the parapet and give it a go, otherwise Philip [Green] would have liquidated that company,” he said. “And thousands of people would have lost their jobs straight away. We gave it the best shot we possibly could. We did everything we could to save that company.”

Field, however, has described Chappell as a “Walter Mitty” character – a reference to the fictional character who lived in his own fantasy world. The committee has heard allegations that Chappell tried to pay for a family holiday to the Bahamas on company expenses and took a £90,000 loan from the department store chain to pay a personal tax bill.

Last month, BHS’s administrators Duff & Phelps sold the retailer’s online operation and 70 overseas stores to Doha-based Al Mana Group. The administrators are continuing to negotiate the future of 164 UK outlets.

Up to 11,000 jobs remain at risk in the UK, with hopes fading of securing a buyer for a large chunk of the chain as a going concern. All the stores continue to trade, but are running closing down sales while administrators continue to negotiate with potential buyers.

Powered by article was written by Zoe Wood, for The Guardian on Tuesday 5th July 2016 19.16 Europe/London © Guardian News and Media Limited 2010


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