Business as usual for shamed tax expert Deborah Annells
Tax expert Deborah Annells, the founder and managing director of AzureTax, of which we wrote yesterday, appears to be unfazed by the drubbing she received at the hands of the disciplinary tribunal of Britain's Chartered Institute of Taxation, which found she had acted dishonestly in several instances.
In one case, according to the tribunal, she had dishonestly used funds entrusted to Azure Trustees to make payments of HK$5.2 million that were not in the interests of the trust's beneficiaries, although ultimately no trust money was lost. She has denied any dishonesty.
Yesterday, it was business as usual. She sent out an e-mail urging people to attend a seminar at her company offices on "US tax issues for expats". In the e-mail, she describes herself as having been at the "forefront of Hong Kong's taxation profession for over 18 years". She adds that she formed her company, AzureTax, "to provide transparent, strategic and ethical tax advisory services for individuals and businesses".
The disciplinary tribunal noted that Annells had "committed six separate breaches of the fundamental principle of integrity as set out in the Professional Rules and Practice Guidelines of the Chartered Institute of Taxation", of which she was a fellow, until recently expelled.
This is not the first time her professional conduct has been criticised. In High Court proceedings several years ago involving Azure Trustees, one of Annells' companies, and plaintiff Clemencia Gallagher, judges involved with the various hearings and appeals were scathing in their criticism of her.
Annells had drawn up a trust deed at the request of Gerard Gallagher, who subsequently died, to provide for his wife in the event of his death. One judge commented that, "The poor drafting of the deed had certainly given room for creative construction of the deed," and later, "One certainly hopes this … will never be used again as it is bound to stir up more trouble than it resolves."
The same judge said that Azure Trustees' defence "was in the words of counsel for the plaintiff, vexatious and oppressive". The judge quoted a letter from the deceased's sister criticising Annells.
"You may also point out to Ms Annells that I am absolutely outraged at the manner in which she has behaved to date and that I require her stop messing about and stop squandering or hoping to squander monies left by Gerard." The judge said he agreed with the view that Annells' company, Azure Trustees, was motivated not out of any obligation towards Gallagher's wishes but by its own benefit of having its interest in the annual fees [from administering the trust].
A banker's oath?
It's not for nothing economics is called the dismal science. Stephen King, HSBC's group chief economist and global head of economics and asset allocation, did not disappoint. He is promoting his new book, When the Money Runs Ou: The End of Western Affluence.
Despite the sunny optimism of the likes of the Mario Draghi, president of the ECB, and French President Francois Hollande, King does not think the financial crisis in Europe is over. People will not put up with unrelenting austerity year after year and will eventually revolt, he says. But it is not before something deeply unpleasant occurs that governments are moved to do something effective. A number of things need to be fixed along the way, not least of which is trust in the financial system, which is still very low. By this he means not just the public perception of bankers, but that bankers don't trust each other. He advocates a Hippocratic Oath for bankers. We fear it is too late to push that genie back into the bottle.
Go easy on the innovation
So-called "wealth management" products on offer by mainland banks soared to 9.85 trillion yuan (HK$12.4 trillion) at the end of last month, Caixin reports. While some may be kosher, a number appear fanciful. They have included "opportunities" to invest in the production of films. Others have had a rather subprime look about them. The products come under the purview of Wang Yanxiu, the head of the financial innovation department at the China Banking Regulatory Commission. He said recently that, while he encouraged banks to come up with new ideas, "innovation" should be scrutinised. Wise words indeed.