Sarah Petre-Mears is running one of the biggest business empires on earth. Or so it would appear. Official records show her controlling more than 1,200 companies across the Caribbean, the Republic of Ireland, New Zealand and the UK itself. Her business partner, Edward Petre-Mears, is listed as a director of at least a further 1,000 international firms. But the true headquarters of this major businesswoman remains mysterious. The UK companies register lists 12 addresses for her, several in London. None are real homes: several are PO boxes, collecting mail for hundreds of locations, while others merely house the offices of incorporation agencies. Only one listed address, a cottage on Sark, seems genuinely residential. Sark is a remote self-governing tax haven in the Channel Islands.
A characteristic "nominee director declaration", used reads like this: "I, Ian Taylor, Director BRAD LAND LTD, having agreed to the appointment as Director of a company duly incorporated under the laws of the British Virgin Islands [BVI] … hereby declare that I shall only act upon instruction from the beneficial owners." The nominee secretly hands back all control to that real owner. Typically, "To transact, manage and do all and every business matter … To open any bank account and to operate the same … To enter into all contracts … To collect debts, rents and other money due. Nominees favour residence in self-ruling havens such as Vanuatu or Nevis because they aim to be beyond the reach of the developed world's tax and legal authorities. But they avoid the BVI itself. Because the BVI recognises British law, local residents could in theory be vulnerable to claims of legal liability from creditors and others. Finally, a signed, but undated, director's resignation letter enables a nominee to duck liability in the event of any trouble.
The British Virgin Islands (BVI) is a micro-state consists of little more than a few stretches of tropical beach, with a population about the same size as that of the Berkshire town of Windsor yet it is home to more than a million businesses. Secrecy is the BVI's stock-in-trade. The BVI government normally has no idea who actually owns the tax-free companies or what they do. The only significant information supplied to the official registry is the name of the company's agent – one of the local firms who arrange incorporations and collect the hefty annual fees. The agents will rigidly refuse to release further facts to anyone. There is only one narrow legal gateway through which it is sometimes possible to squeeze. If shown definite pre-existing evidence of criminal fraud, rather than tax-dodging, the BVI courts will sometimes order a local agent to disclose what it knows. Even such a rare courtroom victory can be illusory, however. The agents may even then only produce the names of sham nominee directors or shareholders, based in Nevis or Vanuatu or Dubai, where the British legal system is powerless. The agents may also claim they have no knowledge of the real buyer of the company, because they took all their instructions from a so-called "introducer" based in yet another country, such as Cyprus or Panama. The paperchase can often be costly and almost endless, giving suspects time to empty their accounts and cover their tracks.
Agencies who market BVI secrecy do so pitching their advertising with slogans like "I want to be invisible.", "nominee officers and shareholders when confidentiality is a key issue", "The names of directors and shareholders do not appear on any public documents.", or "Maximum confidentiality and anonymity … Unlike many other jurisdictions, there are no disclosure requirements."
BVI, presided over by a British governor, Boyd McCleary and whose national anthem is ‘God Save the Queen’, collected $180m (£112m) from registration fees, more than 60% of total revenue. The BVI's Its current prosperity depends utterly on the money. Michael Foot, a former Bank of England official and Financial Services Authority managing director reported rejected transparency and e said the UK should merely "press for improvements" in disclosure by all overseas tax havens simultaneously, at unspecified future international discussions. This was a classic recipe for inaction.
Sir Edward Clay, who crusaded against corruption in Kenya, gave his opinion to the Times in September about the BVI's secrecy jurisdiction: "The money held in such places comes from all over the world and probably doesn't bear examination– which is why it doesn't get much. But it conveniently looks after our payments deficit, and saves us the cost of running our small dependencies … The cost and damage inflicted on other countries by our louche [disreputable or sordid] regime at home and abroad makes us vulnerable to charges of hypocrisy and worse."
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