Mishcon de Reya: Tax-dodging and reputation management

Protection of excessive unearned untaxed wealth and concomitant protection of reputation are the focus of London-based law firm Mischon de Reya.  Its services are available to wealthiest clients only.  

Africa House, Kingsway, London, UK
Africa House, London, office of Mischon de Reya

Unless otherwise stated, italicised quotes below taken from Mishcon’s website: Mishcon de Reya.

Corporate lawyers
We are a law firm for the world of business” is partly true.  Mishcon is a law firm for the owners of businesses.  “At Mishcon de Reya we act for businesses, wealth owners and dealmakers to help them make the right choices for their private capital and ventures and then offer the practical support to populate, grow and protect their assets.”

Mishcon enabled redundancies including

acting for a global media organisation, acquiring a substantial portfolio of business and subsequently making large scale redundancies; acting for a pharmaceutical company to collectively consult with, and subsequently dismissing, a significant number of employees; acting on large-scale collective redundancy at a professional Football Club; acting for a regulatory body looking to make substantial reductions in its workforce.”

Stifling opposition to exploitation is a recurrent theme in its ideology: “Achieving the strategic long and short term aims of the business, whilst minimising the risk of claims [against redundancy], is key.”  

Mishcon attempted to support Tory party mouthpiece and disgraced businessman Charlie Mullins’ fraudulent classification of his employees (of Pimlico Plumbers) as self-employed to help him dodge his obligations with respect to workers’ rights. 

Tax avoidance
Mishcon declared, brazenly and repeatedly, its commitment to ensuring the wealthiest avoid as much tax as they can.  

In Tax Mischon stated that it

advised an Ultar-High Net Worth family in relation to their tax and all other private client affairs, including offshore trusts.  This involved advising on the restructuring of their multi-national business interests to segregate their shareholdings in foreign business and real estate for tax and dynastic planning purposes,” 

and

advised a High Net Worth individual relocating to the UK.  We advised on all aspects including his residence and domicile status, pre-arrival tax planning, his ability to claim the remittance basis and tax exposure as a shareholder of various offshore companies.”

In Wealth Structuring Mishcon congratulated itself on 

advising an Ultra High Net Worth (UHNW) family on the restructuring of their multi-national business interests to segregate their shareholdings in foreign business and real estate for tax and dynastic planning purposes; advising a UK resident non-UK domiciled individual on his UK tax and dynastic planning.  In particular we have been advising on the creation of three separate tailor-made offshore trusts for different classes of beneficiaries; advising a Chinese billionaire property developer on his UK tax and estate planning including how to structure the purchase and ownership of a very high value UK residential property.”

In Corporate Finance And Mergers & Acquisitions Taxation Mischon listed a range of sneaky tricks including cross-border tax avoidance:

We look at the holding and investment structures (in many cases on a multi-jurisdictional basis), tax efficient financing arrangements and undertake the negotiation of the documents to deal with tax risks.  Non-transactional tax matters, in relation to the establishment of new business start-ups, spin outs or transfers of teams to form a new business, whether these include corporate entities, partnerships or other arrangements or are a mixture of more than one of these.  Where there is a significant overseas element in a transaction we can play a lead role in coordinating numerous advisers in several jurisdictions to achieve the optimal overall tax outcome given the commercial parameters.”

UK law does more than allow the wealthiest to dodge taxes with the guidance of firms like Mischon; the law is structured to enable avoidance.  The Johnson-led Tory government’s Brexit will enhance the capability of Mischon’s wealthy clients to avoid their social obligations.

Mishcon’s contempt for complicit HMRC was mentioned casually in Tax Litigation And Dispute Resolution:

In recent years the tax authorities have become far more aggressive in collecting tax that they believe is payable.  However, this aggressive approach is often unwarranted and our specialist team have been able to persuade HMRC of the correct treatment at an early stage.”

The quote above damned Mishcon as an enabler of tax avoidance and damned HMRC as easily manipulated.  The word “persuade” did a lot of work.

Reputation Protection and libel
Reputation Protection for the wealthy is a big earner for Mishcon.  Its services include advice on

Challenging the publication of damaging or private material, both in the media and in a more limited, private or commercial context; online/social media attacks; press/pre-publication enquiries about personal/corporate affairs, including from NGOs/regulators/other public bodies.”

Mishcon bullies people into keeping quiet.  Habitually, it sends threatening letters that demand a voice is silenced and that published opinions or facts are deleted.  A threat of legal action for libel and/or defamation of character is a threat of extraction of a large sum of money.  Mishcon knows that a threat is usually sufficient due to prohibitive legal costs and because of the ineptitude of many protagonists in the British judicial system who are willingly persuaded in court by Mishcon’s verbosity.  

Arron Banks was among Mishcon’s reputation protection clients.  Trying to protect Banks’ reputation was a difficult task.  The assistance to Banks included a threatening letter sent to Brexit Coordinator for the European Parliament Guy Verhofstadt.

MischonDeReya1

In the letter Mishcon pretended to decide what readers of a tweet would deduce and it called Banks, who registered his businesses in offshore tax havens, a “pro-British patriot” and a “philanthropist.”  Mishcon’s only objection to what Verhofstadt wrote was that Banks didn’t like it.  

A recurring theme of Mishcon’s reputation management is high rate of failure in court but if it loses a case the victims of its behaviour can still face huge costs and this acts as a deterrent to others to proceed with legal action as plaintiff or else to defend themselves in court.  Costs for Mischon’s clients, whatever the cases’ outcomes, are non-problematic because they are very wealthy.  Thus, Mischon is indifferent to the veracity or otherwise of comments to which its clients object or of accusations that its clients make.  The wealth of the clients allows threats to succeed in silencing people or coercing defendants to accept pre-trial agreements.

For example, Mishcon lost a case brought against UCU by Ronnie Fraser but UCU incurred six-figure costs that Fraser is refusing to pay.  As Asa Winstanley noted in Fraser vs UCU, “even though Fraser’s case was so utterly defeated, [it] may still count it as a win if other [students’] unions are intimated by the prospect of footing massive legal bills.”  The case was so pathetic that the judge was dismayed it even took place.  In his judgement he said: “Lessons should be learned from this sorry saga.  We greatly regret that the case was ever brought.  At heart, it represents an impermissible attempt to achieve a political end by litigious means. It would be very unfortunate if an exercise of this sort was ever repeated.”

Mishcon’s preference for word salads as a tool of intimidation was demonstrated in a bizarre rambling letter it sent to former Labour NEC chair Jennie Formby as a response to a letter Margaret Hodge had received from Labour’s NEC regarding her behaviour toward then leader Jeremy Corbyn.  

Mischon claimed “our client finds herself in an impossible situation of an investigation being opened against her in relation to which she has no knowledge of the particular allegations under investigation” but Hodge knew exactly what the investigation was about: She had set up a public confrontation with Corbyn and talked about it publicly afterward. 

The letter whinged about media coverage of the investigation while ignoring Hodge’s public statements and those of her supporters, it mentioned some social media criticism of Hodge that was nothing to do with the NEC, and it concluded by issuing instructions to Jennie Formby with a threat that if the NEC did not follow the instructions then “the fairness of the proceedings will be further, and gravely, undermined.”  Mishcon even gave a day and time by which Formby should respond.  Absurdly, the letter was wholly unnecessary because Hodge had not been charged by the NEC with any offence

Within a couple of weeks of Hodge’s wrongdoing, she expressed regret at her behaviour and accepted a warning from Labour’s NEC.  A second letter from Mishcon to Jennie Formby denied Hodge had expressed regret.  “She [Hodge] did nothing wrong” stated Mishcon – an opinion, not a fact.  Mishcon mentioned some unrelated issues about other Labour members that were unconnected to any dispute with Hodge and included an insulting and libellous remark:

It is clear you [Formby] were making the rules up as you went, and even in defeat you sought to spin your final decision in a disingenuous and false manner.”

The tone of the above comment should be understood in the context that a Corbyn-led Labour government (if it had been elected in 2019 general election) would have sought to crack down on much of the tax avoidance in which Mishcon’s high-paying clients indulge.  

The letter concluded with “our client is pleased the investigation is now over, and welcomes your apology for the distress she has suffered in the weeks since 18 July.”  However, Hodge stated in a social media post that Labour’s NEC had not apologised to her.

Russian oligarchs
There’s an odd page on Michon’s website called VIP Russia that doesn’t mention Russia outside of its title.  It contains links to other pages of the site, none of which are specific to Russia, and states that “the UK remains a destination of choice for High Net Worth (‘HNW’) individuals and their families.  For many years, Mishcon de Reya has advised and assisted international HNW clients on establishing themselves in the UK.”  Clearly, it is a begging page for custom from remnants of the oligarchs and disaster capitalists that acquired wealth via theft of public services and property after the termination of USSR.

Tax Evasion
Mischon does not restrict its opposition to the wealthy paying tax to tax avoidance.  It intends to prevent the British government’s use of the Common Reporting Standard (CRS) that is part of an international strategy to help to investigate tax evasion.  Mishcon filed a spurious complaint with HMRC wherein they claimed that CRS infringes data protection rights.  Quoted in Tax Evasion, Mishcon‘s spokesperson Filippo Noseda said

There is a wealth of objective evidence supporting our proposition not least the comparisons made between the CRS and the Data Retention Directive – the latter of which was effectively declared illegal by the European Court of Justice in 2016.  In a democratic society, the rights to privacy and data protection are an essential safeguard to protect compliant citizens against potential abuses and must be treated with the appropriate seriousness by the authorities.” 

His comments were typical of distraction techniques used in written and oral correspondence by his employer: A democratic society,” “rights to privacy,” “essential safeguard” and “potential abuses” were examples of emotive directional language favoured by Mishcon.

Mishcon claimed its complaint was issued on behalf of an EU citizen.  If such a person exists, she or he was not named.

Execution of Daphne Caruana Galizia
Journalist Daphne Caruana Galizia was executed in Malta on 16th October 2017 following years of investigative journalism into corruption in the Maltese government. 

She investigated Henley And Partners who worked with the Maltese government to assist wealthy people to acquire Maltese citizenship.  Henley And Partners tried to stop her investigation by threatening legal action.  They used the British judicial system to issue their threats because of its history of accommodation to the demands of wealthy plaintiffs, and hired Mishcon to compose threatening letters that were sent to Daphne Caruana Galizia a few weeks prior to her execution.

Summary
Mishcon’s summary of its operation was a self-satisfied soulless smirk: “We pride ourselves on the assertive and practical approach that we take to deals.  We are responsive and we are decisive: our speed comes from our confidence that we have understood and fully appreciate the motivations of owners and dealmakers.”

A law firm for the world of business” meant a law firm acting for the wealthy who want assistance to bypass laws, regulations and taxes and who want to suppress criticism and investigation of their behaviour. 

The first act for any socialist government in Britain must be to stop billions of pounds of tax avoidance every year and the first step to take is to hit the enablers of tax avoidance hard.  Mischcon, and their ilk, must be dealt with promptly and decisively.

Related blogBritish Tax Havens
Other infoSLAPP
Other reading: Solicitors Regulation Authority investigation

Mishcon de Reya: Tax-dodging and reputation management

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