Deborah Annells, who is founder, managing director and head of tax consulting services at Azure Tax, was found to have committed six separate breaches of the “fundamental principle of integrity” as set out in the Professional Rules and Practice Guidelines of the CIOT.
Azure Tax describes itself as one of the leading independent international tax advisory practices in Hong Kong and Singapore.
The Taxation Disciplinary Board, an independent body which manages the complaints and disciplinary scheme for the UK’s taxation bodies, said the breaches were found during a Disciplinary Tribunal which was held between the 10th and 17th of last month.
The tribunal found:
1) She had dishonestly used trust funds, entrusted to the care of AzureTrustees, to make payments of HK $5,200,000 (£435,000, $670,000, €500,000) that were not for the benefit of any of the beneficiaries of the trust, although no trust moneys were ultimately lost;
2) She had failed to separate and maintain bank accounts belonging to the AzureTax Group and its associated companies, all of which she controlled, from client funds held by or on behalf of the Group or its associated companies;
3) She sought to deceive a solicitor acting for one of the trusts managed by one of her companies by relying on a bank statement which she knew or ought to have known was forged;
4) She dishonestly withdrew US$10,000 from a Singapore company which was part of AzureTax Group and put it into an account operated by one of the Azure Hong Kong companies;
5) and 6) She dishonestly submitted two applications to add an Azure service company as a bank signatory to a client company’s bank account without the knowledge of their owners.
The breaches arose from complaints made by one client, one former colleague and a former joint venture partner in Singapore.
However it is business as usual for Annells according to one source
The Taxation Disciplinary Board said Annells denied all the charges, except number two, and, while she did not attend the tribunal, submitted detailed written submissions in her defence. She was also not represented for most of the hearing.
It was also recorded at the tribunal that, while she had expressed regret about the whole matter and in particular any distress caused to the one client who complained, “she had never acknowledged that she had been guilty of any kind of wrongdoing nor given any indication that she had any insight into the seriousness of the charges found against her”.
In addition to be being expelled from the CIOT, the tribunal ordered Annells to pay the costs of the hearing in the sum of £62,375.
Business as usual
According to local commentator, Howard Winn, who writes for the South China Morning Post, it is not the first time the Annells’ integrity has been questioned.
In a column published on 24 July, Winn pointed out that “several years ago” Annells’ professional conducted was criticised in Hong Kong’s High Court, with the judge in the case ultimately suggesting Annells and her company Azure Trustees were motivated “not out of any obligation towards [the client] but by its own benefit”. It should be noted that the case was ultimatley dismissed.
Winn also noted that, despite the ruling by the Taxation Disciplinary Board, Annells has continued to conduct “business as usual”, emailing people following the tribunal urging them to attend a seminar at her company offices on “US tax issues for expats”.
This story was updated on 30 July to reflect that the case referred to towards the end of the piece was at the High Court in Hong Kong and that it was dismissed.
