The Long Read: Offshores take two local NHS trusts for a ride
Two local NHS trusts are being taken for a ride. D.R.C. Locums Ltd & Maxxima Ltd are recruitment companies who provide staff to keep our local NHS services working, and sometimes at great expense to the public purse. These two companies have received in excess of £12 million, much of it ending up in tax havens, such as the Cayman Islands, Liechtenstein, Hong Kong, New Zealand and the Netherlands.
Kent Community Health NHS Foundation Trust (KCHFT) began payment to D.R.C. Locums Ltd back in May 2015. According to KCHFT spend data they have spent in excess of £10 million pounds with D.R.C Locums between May 2015 and Jan 2019. But it is not just KCHFT who have made payments to D.R.C. Locums Ltd, East Kent Hospital University Foundation Trust have as well and can be found in their spend data.
Spend on D.R.C Locums by KCHFT for 2016 = £7.9 million
D.R.C. Locums specialise in in the supply of temporary, permanent and international nurses, mental health practitioners and doctors. “Honesty is the key to our approach…” they make clear on their website.
D.R.C Locums Ltd is ultimately owned by Syndicated Investor Group Limited who have addresses in Hong Kong since 23rd May 2005 but are head-quartered in Lichtenstein for tax purposes.
Syndicated Investor Group Limited is in the Panama Papers once and the Paradise Papers once. The Panama Papers were given to the world in April 2016 and D.R.C. Locum Ltd have received payments from KCHFT from May 2015 according to their payment to suppliers data, still publicly available.
Did representatives of KCHFT or EKHUFT undertake any due diligence on the ownership of D.R.C. Locums Limited?
As of May 2015, KCHFT were paying D.R.C Locum Ltd for locum nurses and doctors, and from 2016 for EKHUFT. D.R.C Locums Ltd owners, Syndicated Investor Group Limited had two shareholders. These were:
The Anstalt (Establishment) is a legal form, which is not known in any other jurisdiction apart from Liechtenstein – a known offshore tax haven, which does not disclose the beneficial owners names.
Liechtenstein is on the EU watch list of tax havens
An Anstalt is a hybrid between a company limited by shares and a foundation. An Anstalt is an entity, which has no members, participants or shareholders. It differs from a company in that it has no duty to return profit and differs from a trust in that it has no obligation to a beneficiary. Anstalt do have, however, a holder of the founder’s rights. The founder can be either a legal person or a natural person, need not be resident in the host country and Anstalt must have a minimum capital of USD 33, 800. There is also no need for the founder identity to be notified to the registration office – made public. Also an Anstalt can have nominee directors and a nominee shareholder.There are two types of Anstalt; commercial and non-commercial, and they feature prominently in the finance system of Liechtenstein.
Now these two companies give their addresses as Heiligkreuz 6; LI-9490 Vaduz; Liechtenstein. This address is named in the Panama Papers not once, but twice.
This address is the home of Marxer & Partner – The Oldest and Largest Law Firm in the Principality of Liechtenstein which for those of you who do not know is an offshore tax haven. Tax evasion is not a criminal offence in Liechtenstein.
The two companies behind Syndicated Investor Group Limited, Quorom Anstalt, and Fundationsanstalt cannot and must not by law release any public data on the person/s who own them.
So how could any due diligence discover the ownership of these companies? In short they could not.
Now as far as we can tell Syndicated Investor Group Limited has had two different registered addresses in Hong Kong – also considered to be a tax haven, they are:
Room 906, 9/F Ocean Centre, Harbour City 5 Canton Road, Tsim Sha Tsui, Kowloon, Hong Kong
2nd Floor, Queen Centre, 60 Queens Road East, Wan Chai , Hong Kong
Now Syndicated Investor Group Limited has 100 shares in CBG Trustee Company Limited
The directors of CBG at the time of the D.r.c. Locum Ltd contract starting in late 2016 were:
Dennis Raymond CHURCH, director, 4 Jun 2010- 6 Mar 2017
Robert Leslie SMITH, director, 7 Feb 2014-22 Dec 2018
Simeon John WRIGHT, director, 14 Apr 2015- 7 Apr 2017
Angela Marie DIXON, director, 10 Jan 2018-
John Edmund ROSS, director, 1 Feb 2017-
The person of significant control of CBG also hold 100 shares in Public Trust Castle Point Nominees Limited and are registered at the offices of Public Trust in New Zealand who are a corporate trustee provider service.
New Zealand has recently been subject to criticism that it is a tax haven, for reasons that include financial secrecy considerations. The problem is New Zealand’s tax treatment and disclosure requirements concerning ‘foreign trusts’, which have foreigners as the settlor and beneficiaries and do not have New Zealand sourced income.
It is more than likely that none of those above are the true owners of Public Trust Castle Point Nominees Limited, CGB Trustee Company Limited or Syndicated-Investor-Group-Limited, they are or were just proxy directors.
So DRC Locums Limited the company owned by Syndicated-Investor-Group-Limited via Lichtenstein, Hong Kong and New Zealand have extracted in excess of £10 million from Kent Community Health NHS Foundation Trust, according to their payment data.
In November last year DRC Locums in partnership with NHS England held interviews during the last week of November in Maidstone, as part of the International GP Recruitment Programme, to recruit GPs to work in GP practices in East Surrey & Sussex and Kent & Medway. The programme came with a wide range of attractive benefits and as well as financial support, the scheme also offers practical and logistical support, including help finding a home, schools and other local facilities; help with day to day tasks such as setting up bank accounts and help with relocation costs.
See here – drclocums.com/ and click on the blog link
At the time of posting the number of doctors hired after the interviews is not known.
KCHFT & EKHUFT were asked for comment, a reply came there none from either.
In all of this we would ask who undertook the due diligence on D.R.C. Locums Ltd for Kent Community Health NHS Foundation Trust and East Kent Hospital University Foundation Trust?
Is the fact we cannot know the Ultimate Beneficial Owner/s of D.R.C Locums Ltd a red flag? Is the fact that the parent Company and its ancillaries registered in Liechtenstein are in the Panama Papers and Paradise Papers enough of a red flag to warrant rejection from any tender? Is the fact that ownership runs through 3 locations, all considered to be tax havens. Together are these sufficient red flags to make one reject this company’s offer back in 2016?
However, we know it is not just D.R.C Locums Ltd whose owners turn up in the Panama Papers & Paradise Papers. Maxxima Ltd (trading as Labmed Recruitment) is ultimately owned by Indigo Cayman Limited Partnership registered in the Cayman Islands, a known offshore tax haven, according to Maxxima’s accounts. The man who heads up this Private Equity company is Ramid Farid Sousou who is named in the Paradise Papers.
As the Shepwayvox Team rightly say, there are probably more than two and no doubt this is a nationwide phenomena. For what it is worth, if you can know the ultimate beneficial owner of the offshore, then by all means allow these guys and girls to do business with the NHS. If you can’t, then no way Jose. And it does make you wonder how good their due diligence is.