Revealed: officials raised ‘flag’ over Nadhim Zahawi’s tax affairs before he was appointed chancellor
A “flag” was raised by officials over the financial affairs of the new chancellor, Nadhim Zahawi, before he was promoted, the Observer can reveal.
Civil servants in the Cabinet Office’s propriety and ethics team are said to have alerted Boris Johnson to a HM Revenue and Customs “flag” over Zahawi before his appointment. The PM appointed him despite the possible concerns over his tax affairs.
“It’s extraordinary that flags were raised ahead of Nadhim’s appointment by the Downing Street proprietary team,” one source said this weekend. “These sorts of concerns would stop someone receiving an MBE or OBE. The idea he could be chancellor or even prime minister is unbelievable”.
The revelation comes after a report last week in the Independent that Zahawi was investigated by the National Crime Agency (NCA). The investigation did not lead to any action and there is no suggestion of wrongdoing.
Zahawi, 55, who is set to launch his leadership bid on Sunday, is under mounting pressure over his financial affairs. He is one of the richest members of the cabinet and has a personal fortune of more than £100m. He now faces calls to explain the financial arrangements of his family trust, an offshore firm, Balshore Investments in Gibraltar, which held shares worth more than £20m in YouGov, one of the country’s leading polling firms, which he co-founded.
The company said in a statement to the Observer this weekend: “When Nadhim Zahawi was a director of YouGov plc, his beneficial interests in the company included shares held by Balshore Investments Ltd, a family trust of Nadhim Zahawi.” A source close to Zahawi said he “does not have, and never has had, an interest in Balshore Investments and he is not a beneficiary.”
The trust held the shares for
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