The accountancy company insists it has ‘no indication’ alleged tax evasion related to its own business or that of its clients
Four senior partners with accountancy giant KPMG have been placed on administrative leave after they were arrested in Northern Ireland in connection with suspected tax evasion.
The men were detained on Wednesday at KPMG’s Belfast office where they are based as part of an investigation by HM Revenue and Customs.
The accountancy company said it was co-operating with the HMRC inquiry but insisted it had “no indication” that the alleged tax evasion related to its own business or that of its clients.
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The arrested men – named as Jon D’Arcy, Eamonn Donaghy, Arthur O’Brien and Paul Hollway – are understood to be KPMG’s most senior staff in Northern Ireland.
In 2005, the four men set up their own investment company, JEAP, which invested in property.
The Irish News reported that the firm, named after the initials of its owners, suffered heavy losses following the 2008 crash. It is not clear whether the HMRC investigation relates to the company.
In a statement, KPMG said:
It is important to emphasise that we do not have any indication that this investigation relates to the business of KPMG or the business of our clients. Pending further information and enquiry, we can confirm that four partners in our Belfast office are on administrative leave.
Mr Donaghy is KPMG’s head of tax in Belfast and had been a prominent figure in the company’s campaign to persuade the Westminster government to allow Northern Ireland to lower its corporation tax rate.
A deal reached last week to save Ulster’s power-sharing devolved administration included a right for Northern Ireland to set a 12.5 per cent corporation tax rate (compared to 20 per cent for the rest of the UK). The move is to allow the province to compete more effectively with the Irish Republic, which has been successful in attracting multinational corporations with its low tax rates.
The Chancellor, George Osborne, used his autumn statement to reiterate the Treasury’s commitment to the tax cut, saying it showed the Conservatives had listened to the concerns of the business community in Ulster.
The arrested KPMG executives also include Mr Hollway, who is head of corporate finance for the company in Northern Ireland, and Mr D’Arcy, who is its head of audit and transactions in Belfast.
HMRC said its investigation was ongoing. A spokesman said: “HMRC officers arrested four individuals from Northern Ireland yesterday in connection with a suspected tax evasion. We can’t comment further.”