British hedge fund trader accused of £1billion fraud and money laundering is extradited from Dubai to Denmark

British-Danish businessman Sanjay Shah has been extradited from the UAE to Denmark, where he is wanted for allegedly orchestrating a £1.44 billion tax fraud and money laundering scheme.

Shah, 52, was arrested in Dubai last year at the request of Danish authorities, who accused him of exploiting European tax systems for his personal gain through his now-defunct hedge fund.

UAE state media said today: 'UAE authorities today extradited suspect Sanjay Shah, a British citizen, to Denmark, where he is wanted by judicial authorities on charges of tax fraud and money laundering.

'Shah was extradited to the Security Mission of Denmark, according to legal procedures, based on a decision of the Court of Cassation in Dubai and the resolution of the Minister of Justice, which approved the extradition.

Shah is accused of running the scheme between 2012 and 2015, and was arrested by Dubai police last year following a request from Danish authorities to extradite him over the alleged fraud that has dogged him for years.

Sanjay Shah, 52, (pictured) was arrested in Dubai last year at the request of Danish authorities, who accused him of exploiting European tax systems for his personal gain

The Danish Customs and Tax Administration (SKAT) wants to recover £1.44 billion from several defendants, including Shah and his hedge fund

The Danish Customs and Tax Administration (SKAT) wants to recover £1.44 billion from several defendants, including Shah and his hedge fund, who it claims submitted fraudulent claims for tax credits in so-called 'Cum-ex' transactions.

He has consistently denied wrongdoing.

'Cum-ex', Latin for 'with-without', schemes that flourished after the 2008 financial crisis involve rapidly trading shares around a syndicate of banks, investors and hedge funds to exploit the tax systems of countries such as Denmark and Germany . and Belgium.

Cum-ex transactions worked when a supposedly fraudulent network loaned each other shares in large companies so that the tax authorities thought there were two owners of each share.

Banks used in stock trading would then issue a receipt that would 'confirm' that dividend tax had been paid on the transaction.

In cum-ex trades, fraudulent networks reportedly quickly traded these shares just before the dividend payout date, allowing them to reclaim double the taxes.

It is estimated that cum-ex transactions cost ten European countries more than 55 billion euros.

Shah's lifestyle on Dubai's luxurious palm-shaped island has sparked outrage in Denmark in recent years.

During his time in Dubai, the hedge fund manager ran a center for autistic children that was closed in 2020 when Denmark tried to extradite him.

He also oversaw a British charity, Autism Rocks, which raised money through concerts and performances.

The trader previously had his £14.7million Hyde Park mansion seized by Denmark after being accused of fraud.

Between 2022 and early 2023, he was involved in lengthy legal proceedings over whether he should be extradited from the UAE to Denmark.

After the Dubai Court of Appeal initially rejected an extradition request from Denmark in September 2022, it later overturned that decision in December

This was confirmed in April, although no timetable for his extradition was given.

In a separate ruling in September 2022, Shah was ordered to pay £1 billion to the Danish tax authorities as part of a civil case in Dubai. His lawyers are also appealing against this ruling.

Last month, Shah lost a last-ditch bid to stop Danish tax authorities from prosecuting him and others in London over the alleged crimes, in a British Supreme Court ruling that paved the way for a year-long civil trial to begin in April next year to start.

Investigations led by Germany and Denmark have led to bank raids, arrests and prosecutions by some of the world's most prestigious legal and financial institutions.

In 2018, Ulf Johannemann, former managing partner at elite law firm Freshfields Bruckhaus Deringer, was arrested and charged for allowing a client to reclaim €383 million in never-paid taxes.

A high court in Germany said this week that former Magic Circle lawyer Johannemann will be found guilty of this 'very likely'.

Denmark has charged nine British and American citizens over the schemes, which it says cost the country more than 12.7 billion Danish crowns.

MailOnline has contacted Shah's lawyers in the UAE for comment.