Dividend Deceptions: Delving into the Most Common Dividend-Tax Fraud Schemes
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In April 2023, a Dubai court ordered a former hedge fund trader to be extradited to Denmark, where he stands accused of a $1.9 billion dividend-tax fraud. So-called “cum-ex trades,” otherwise known as “dividend stripping,” have reportedly cost Germany and 10 other countries an estimated $57 billion in lost tax income over the past decade or so. Meanwhile, so-called “cum-cum trades” have also proliferated, allowing shareholders to avoid paying a dividend tax when they temporarily transfer their shares to an investor abroad. In March 2023, French prosecutors raided the offices of five large banks on suspicion of involvement in long-running cum-cum schemes. This webinar will unpack both kinds of dividend- tax fraud schemes and provide insights into how financial institutions can protect themselves against them.
Identifying two types of tax fraud, as well as clarifying the distinction between tax evasion and tax avoidance
Explaining what cum-ex and cum-cum trades are, with real-life examples
Sharing best practice on what financial institutions can and should do to fight dividend tax fraud