Partner Nicola McKinney comments on the “cum-ex” tax fraud ruling in Law360

Commenting in Law360, Partner Nicola McKinney examines the recent ruling in Skatteforvaltningen v Solo Capital Partners & ors, in which Denmark’s tax authority suffered a “bruising” defeat in its efforts to recover monies from the sprawling “cum-ex” tax fraud scandal.

Nicola’s comments were published in Law360, 3 October 2025, and can be found here.

“Mr Justice Andrew Baker’s extraordinary 300-page judgment is a devastating blow for SKAT. He stopped short of exonerating the defendants, but found that Sanjay Shah and others were able to ‘help themselves to a fortune’ not because of fraud, but because SKAT’s tax refund system was ‘so flimsy as to be almost non-existent’. Taking advantage of a lax system, and engaging in “collateral dishonesty”, did not amount to a fraud upon SKAT.

“The effect is that the defendants walk away with a huge windfall. Questions will inevitably arise around how the judgment sits against a background where Sanjay Shah has been imprisoned in Denmark for dishonesty offences, and where courts in New York and Dubai have made awards in favour of SKAT, all arising broadly out of the same fact matrix. Legally those outcomes stand alone, but the contrast creates troubling optics and real concerns about the ability of the English courts to deal effectively with complex international fraud.

“There are likely to be questions about the limits of the law of fraudulent misrepresentation, and the scope of SKAT’s claim. Alongside the claim for fraudulent misrepresentation, SKAT also made claims in unjust enrichment, knowing receipt and dishonest assistance – all important claims in the fraud lawyer’s arsenal. Because SKAT had tied these claims to proving misrepresentation, once one fell, they all collapsed. Whether there was a less narrow way to pursue those claims is bound to be scrutinised.

“With £1.4 billion at stake, years of litigation and criticism of its internal controls, this is a bruising defeat for SKAT. But the epic is far from over, and an appeal looks inevitable.”