A second STM Group employee was arrested last week alongside chief executive Alan Kentish, the Royal Gibraltar Police and STM Group has told International Investment.
Kentish, pictured left, the chief executive of the London-listed, Gibraltar-headquartered STM Group, was arrested more than a fortnight ago as reported for allegedly failing to disclose information to Gibraltar’s authorities about a client who had been involved in a tax dispute between two jurisdictions.
The unnamed employee was arrested at the same time as Kentish, it has now emerged.
Today, Inspector Patrick Payas of the Royal Gibraltar Police told International Investment that he was “aware” that a press release has been issued by a local financial group, which he declined to mention, regarding the arrest of one of its employees.
He also declined to comment on the investigation or the substance of the press release, but did confirm that “two employees of the financial group were arrested by officers of the Money Laundering and Investigation Unit (MLIU) on Thursday 19 October 2017 on suspicion of Failure to Disclose”.
Emphasising that the investigation was ongoing, Payas pointed out that no charges had yet been brought and that “both individuals are currently on police bail”.
In a statement circulated to the market, STM Group said of Kentish’s arrest: “In November 2015 the ultimate beneficial owner of the Client, who has been a client of STM’s for over 15 years, became involved in a tax dispute between two countries for the years 2008 to 2013 over their respective taxing rights to the taxes correctly paid by him.”
The statement concluded by saying that the advice received by Kentish and by STM is that the allegations have “no merit”.
It added that the company was now reviewing where its head office should be.
When contacted by International Investment today, a spokesperson for STM Group said that the company had “nothing further to add to the statement that the company had put out on 30 October”.
He added that the reason that the company had made no mention of the second arrest was that this was an employee rather than a director, so the company was not required to disclose it under London Stock Exchange listing requirements.
He pointed out that, as said in the statement, the legal advice that the company had been given was that the allegations were without merit, and that the company believed that the situation would resolve itself “in due course” without charges being brought.
Update at 12.14pm
Since this story was published this morning, STM Group has now put out an updated statement, the text of which is as follows:
Update on Director Declaration
STM Group Plc (AIM: STM), the cross border financial services provider, wishes to update the market on the matter involving Alan Kentish, the Chief Executive Officer of STM, in his capacity as professional director of a client company of STM.
Whilst all parties had expected this matter to have concluded quickly, the position has not changed since the Company’s announcement on 30 October 2017. As such Mr Kentish is exploring the various options available to him to expedite a positive outcome.
Further review and advice continues to demonstrate that there are no merits to the allegations and the Board of STM remains fully supportive of Mr Kentish.
Further announcements will be made in due course, as appropriate.