Chief Minister: ‘No need for policy on beneficial ownership’

Tynwald buildings, Douglas

Tynwald buildings, Douglas

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Chief Minister Allan Bell said he is not convinced there is a need for a policy on identifying the true owners of companies with which government does business.

The issue was raised in Tynwald by Liberal Vannin MHK Peter Karran (Onchan) who argued that financial regulations should require that the beneficial ownership of companies be known.

Mr Karran said: ‘Does he not agree that the fact is that when we are spending the public’s money, the public have a right to know; and especially if the public does not have the right to know, the public’s representatives in here should know where that money is going and what is it being funded for?’

But Mr Bell said he was not aware of any specific concerns or problems which have arisen as a consequence of not identifying the ultimate beneficial owners of companies before government does business or enters into a contract with them.

‘I am not sure that there needs to be a specific policy regarding the identification of beneficial owners. If the member has a specific instance of where he thinks there is something going on, I am more than happy to have a look at it, but not on a general faceless accusation that money is somehow being siphoned off into some nefarious areas.’

Mr Karran suggested he should look at issues such as the ‘ridiculous’ rental agreement with Hamilton House where he claimed Ministers had been involved with the directorships of the companies involved.

Liberal Vannin leader Kate Beecroft (Douglas South) said: ‘It is not a conspiracy theory. This is just part of basic compliance and knowing who you are dealing with.’

Mr Bell said: ‘If the member has identified a problem where we should be investigating, I am more than happy to look at it. But no examples have ever been brought to me of any irregular involvement at this level, either for property purchases or any other activities across government. If there is a problem, please let us know. Bring it out in the open.’

Mr Karran accused the Chief Minister of ‘playing the dumb blonde’. He said: ‘These are basic standards of business. The classic example was Hamilton House. The other example was the issue of the likes of Finch Hill, where we never knew who the beneficial owner was. We got tied up into a horrendous lease.’

Treasury Minister Eddie Teare defended the decision to buy Finch House for £6m, and revealed the rent at the time of the acquisition had been £477,130.

Suggesting Mr Karran should show the evidence for his ‘wild accusations’, he said the original rental contract had been benchmarked against the rental agreements in the market at that time.

He said the building was purchased at a yield of 7.7 per cent, not taking into account a rent review due at the time. The Gambling Supervision Commission had been relocated there from HSBC House, saving an extra £100,000.

Mr Teare said: ‘What we have here is an investment which is saving us over 7 per cent on the money invested. It has saved us an increase in rent and if we had to vacate the premises there would have been a liability for dilapidations. So, all in all, a good deal and a deal well done.’

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