A German court has dropped money laundering charges against Sanjay Shah – founder of defunct hedge fund Solo Capital Partners – in connection with a €330m ($374m) Cum-Ex tax fraud case, citing his conviction in a parallel Danish prosecution, according to a report by Bloomberg.
The Hamburg Regional Court ruled that the case against Shah would not proceed due to the overlapping legal proceedings in Denmark, where Shah was sentenced to 12 years in prison in December for his role in a €1.37bn tax fraud scheme.
Shah’s German lawyer, Björn Gercke, told local media that the defence had long argued the German prosecution in Hamburg was redundant given the Danish verdict. “We have always argued that the Hamburg case can’t proceed given the Danish prosecution for the underlying allegations,” he said.
Shah, a central figure in the sprawling Cum-Ex dividend tax trading scandal, had been indicted in Germany in 2021 on 55 counts of money laundering, accused of funnelling illicit profits from Cum-Ex trades through German accounts. Prosecutors had also charged him with attempted tax evasion, alleging misuse of a tax-exempt US-based charity to claim false refunds.
While the Hamburg court has suspended its case, separate Cum-Ex charges filed by Cologne prosecutors remain active and are not impacted by the decision. Shah is currently in Danish custody and cannot be extradited to Germany due to extradition limitations imposed by the United Arab Emirates, which handed him over to Denmark only.
The court noted the case could be reopened if Shah successfully appeals his Danish conviction.
Six of Shah’s co-defendants in the Hamburg case, who were charged alongside him in 2023, reached settlements with German authorities last year.
