Bernie Ecclestone comes out of hiding

The former general manager of Formula 1, and in fact its key owner, Bernie Ecclestone pleaded guilty to concealing more than £400 million from taxation. The funds, mainly from royalties from racing contracts, were hidden in certain trusts registered in Singapore. As a result, Mr. Ecclestone was sentenced to 17 months in prison.

The famous sports manager Bernie Ecclestone, the organizer of Formula 1 in its current form, admitted guilt in violation of the law. We are talking about hiding income from taxation. The case against Mr Ecclestone has been under investigation for several years. British authorities found that Mr. Ecclestone systematically withdrew the income he received from the Formula 1 World Championship from taxation and placed it in financial structures in Singapore.

As Richard Wright, a representative of the British prosecutor’s office, said during the hearing, Mr. Ecclestone was first questioned about suspicions of concealing income in 2015 (at that time he was still the controlling figure in Formula 1, and in 2017 the series was sold to the investment fund CVC – The transaction cost was about $8 billion).

Eight years ago, Bernie Ecclestone stated under oath that the trust he established in Singapore was created solely for the benefit of his daughters.

During the hearing, Bernie Ecclestone’s answers to questions about whether he has other offshore accounts were also heard. He announced their absence. He also assured the tax service that there were no connections with any other financial structures aimed at hiding income from taxation. All of Mr. Ecclestone’s statements, as it turned out during court hearings, were untrue.

Under pressure from the evidence presented by the prosecution, he was forced to change his statement (at the beginning of the trial, Bernie Ecclestone insisted on his innocence) and admit his guilt.

It should be noted that the proven amount of Bernie Ecclestone’s hidden income amounted to £400 million. During the trial, the prosecution stated that the former head of Formula 1 owed the British treasury, including penalties and fines, £652 million. The court decision does not explain how much Mr. Ecclestone will bear financial responsibility for his violations. Given that he has pleaded guilty, there is a high likelihood of a settlement being agreed with the UK tax authorities.

The judge hearing the case noted the “undoubted seriousness of the violation” committed by Bernie Ecclestone, but also took into account mitigating circumstances. Namely, the insignificant risk of repeating the violation of the law, as well as the health status of the defendant (Bernie Ecclestone is already 92 years old) and the presence of young children (Mr. Ecclestone’s youngest son was born in 2020). As a result, Bernie Ecclestone sentenced to 17 months’ imprisonment, suspended for two years.

Arnold Kabanov