Hostage to Injustice

The real truth: I became a hostage to the outcome of injustice, and consequently the system could simply not allow the truth to be told: I had to be guilty so that the authorities could justify all of their actions and costs but most importantly, the image of the Prosecutor of Special Economic Crimes (Bagmandspolitiet), which was a politically created institution by the Socialist.

Because the Bagmandspolitiet had their loyal henchman at the City Court, Judge Claus Larsen was able to keep me in solitary confinement, pre-trial punishment and restrict the defence month after month.

During the many months, I was incarcerated, I spoke to no one which was a difficult time psychologically, especially coping with the experience of being completely alone with my frustrations.

“The Danish National Bank, the Ministry of Trade, the Company Register and Copenhagen tax authorities all conspired against Hauschildt and the companies while using the involvement of the Ministry of Justice, the Special Prosecution and court as henchmen.” 

Advocate Folmer Reindel to the City Court and 8 years later in 1988 at The European Court of Human Rights in Strasbourg in front of the full Court of 17 Judges.

Solitary confinement imposes conditions of social and perceptual stimulus deprivation. The deprivation of activity, as well as the deprivation of cognitive stimulation, was painful and frightening. You can lose your grasp of identity and of who you are. How you function in the world around you is very much nested in our relation to other people.

Over a long period of time, solitary confinement undermines one’s sense of self. It undermines your ability to register and regulate emotion. The appropriateness of what you’re thinking and feeling is difficult to index because we’re so dependent on contact with others for that feedback. And for me, it becomes a struggle to maintain my sanity. I did develop many physical and mental illnesses, including a paranoid psychosis, a change in my distinct personality and psychological vulnerability. I had delusions of persecution and suffered from megalomania; I was most distrustful and on constant guard. My perception of reality was lacking at the time, as can be seen from the letters to my family.

“The effectiveness of indefinite detention and solitary confinement in provoking anxiety and psychiatric instability”    The conclusion of CIA

When a person suffers injustice, they can become very dangerous and see life as if they have nothing to lose. I felt like that many times and in fact, planned terrible vengeance, just to be able to live with myself.

Just imagine, in the weeks prior to my arrest I had had confirmation (if you understand the markets – a guarantee) that I, and indeed my companies, would make tens of millions of Kroner and then I am arrested and locked up in solitary confinement only to see everything that I have worked for (for more than 20 years) being destroyed by Bagmandspolitiet.

My terrible frustration turned into rage, followed by deep depression where I had to control my hatred towards these low life people from Bagmandspolitiet.

My 55 Days Hunger Strike

After seven months in solitary confinement, I had to go on a hunger strike. I had previously been on a seventeen-day hunger strike after I had spent two months in solitary confinement. I could at least “control” this hunger strike which I had planned to last fifty-five days, taking only water an a few vitamin tablets.

Your Own Body is the Last Resort for Protest

During the summer months of 1980, I did not speak to anyone. My lawyer was away all of July and had been busy and ill during May and June; and he did pay me a visit in early July before leaving for holidays; nevertheless, I did not see anyone else for 3 months.

During this period, I woke to small children voices from not far away laughing, screaming and playing. From where these children played, I knew that I back in my childhood had been playing in the same place. It was a very difficult summer to get through my solitary confinement, and I became more and more indifferent to people and life.

I had tried every possible protest against the injustices I felt; still, I saw headlines in the newspapers about all sort of lies and accusation against me practically every day, a terribly frustrating situation. The media lynching became a considerable mental strain on me.

My sons, wife, mother and family had to endure all these lies and falsehood about my companies and me. I had no way to a response from my solitary confinement, and my lawyer had been giving his strict instruction not to interfere – anyway, he was away on holiday.

At the end of July, I decided that the only thing I had left to protest with was my own body. Therefore, I planned to go on a hunger strike for 55 days. Why 55 days, because 10 is my main number (birthdate), and also I knew if I only took water and some vitamin tablet, I could not lose more than 40% of my body weight.

However, first, I wanted to release to the press my application to the European Commission of Human Rights. Since everyone is away on holiday in July and part of August in Denmark, my first opportunity to do this came when I was brought to court on the 19 August. I wrote to the court first (Letter to Judge Claus Larsen 10 August 1980) and a few days later (Letter to Judge Claus Larsen 15 August 1980) with absolutely no reaction!

As with everything else judge Claus Larsen denied me the right to publish my application to the European Commission of Human Rights.

I had absolutely no control what happened to me; however, my will could control my hunger strike. During these fifty-five days, I only drank water and took two vitamin pills daily. After three weeks I was admitted to the prison hospital ward where I stayed until I had finished my hunger strike.

Not much was mentioned in the media with regards to this hunger strike since the headlines came mostly from Bagmandspolitiet.

Bagmandspolitiet had, at the time, gone to the USA and had campaigned for a month in the tabloid press that I had hidden assets in the USA and Brazil. These were all lies but the tabloid press swallowed it up and it made big headlines. Bagmandspolitiet knew exactly where my money was after the first days after closing my companies.

The so-called tabloid press in Denmark never did write much which had any foundation of truth through the many years.

Only newspapers such as Børsen and Information published some true aspects of the whole event and the prosecutions fabricated a criminal case. Only one newspaper, the political independent Information had had the strength to write the truth and question the authorities and their concerted efforts.

Most of the Danish media published, uncritically, all of the stories that they received from Bagmandspolitiet as well as the fabricated lies and malicious innuendoes. (See The Unjust Trial by the Danish Media)

I paid out 21 million kroner to the authorities and clients days before my arrest in January 1980, moreover, we had millions in our Danish bank account with Den Danske Bank when I was arrested.

Not many people reading the Danish newspapers at the time knew that my companies in Denmark had paid out more than 21 million Kroner to clients and the authorities (taxes) in January 1980, weeks before Bagmandspolitiet closed the companies.

Furthermore, most of the companies and my liquid assets were in London, not hidden in some offshore bank. Most readers only knew that I had transferred four million Kroner to one of my Swiss companies and had planned to run away to South America.

 

“The Silverking stopped on his way to South America” All the media full of stories that I was running away – A BIG LIE CREATED BY THE DANISH AUTHORITIES THE FIRST DAY!

In January 1980, I had been in Switzerland three times: once with my family (New Year) and later twice with my wife for the weekend. In fact, I returned from such a weekend in Switzerland two days before my arrest.

I had been in Germany and twice I had been in Holland working in my company’s offices in Rotterdam, (International Resources). Not to mention twice at my companies offices in Sweden and to a planned office in Stockholm. In other words, if I had planned to leave Denmark, I had ample opportunity. There was absolutely no travel plans, nor anything to link to this fake news. My wife and I did look at a stud farm in Virginia on February 1989, however, we had agreed to buy a property on the Zurich lake.

All this was a manufactured lie created by the prosecution on the first day, in order to get the public, our clients, the media and later the judges to believe that I was running away from Denmark.

The press also neglected to tell their readers that Scandinavian Capital Exchange was solvent with millions when the Special Prosecution closed the company on the 31st January and that that same day, the company had started calling clients for “margin calls” for up to 10 million Kroner during the first week of February.

The tabloid press did not they tell their readers that the Bagmandspolitiet’s accountant’s report (costing 4-5 million kroner) showed that only two months after closing my companies, SCE A/S would have made a net profit of more than 50 million Kroner. Moreover, I was solvent when they arrested me and closed the companies.

When Bagmandspolitiet told the media that I had US$2 million in a Swiss Bank account, they forgot to tell them that this money was not in Switzerland but in London when I was arrested (Call Money Credit Suisse, London US$1.850.000); I had transferred this money from Switzerland to London as I wanted to use the money in the market. In addition to this money, I had most of my liquid assets in London including £300,000 on deposit in one of my companies (Capital Associates).

Days after my arrest I offered to bring this money to Denmark, but Bagmandspolitiet was NOT INTERESTED.

I had nothing to hide, a duplicate of all my bank statements from all over (including from Switzerland) was forwarded to me at my Danish head office, the prosecution knew everything from the first day when they seized all my files.

Nevertheless, the public reading the newspapers all believed that I had the money hidden in a Swiss bank account. 

My Proclamation after thousands of days of pre-trial punishment – restrictive incarceration and long solitary confinement – still without judgment.

A PROCLAMATION OF FLAGRANT INJUSTICE IN THE STATE OF DENMARK’ – 27th OCTOBER, 1982

ONE THOUSAND DAYS INCARCERATED WITHOUT CONVICTION OR JUDGEMENT

I, the undersigned, hereby accuse the two former Ministers of Justice, Henning Rasmussen and Ole Espersen and the present Minister, Erik Ninn-Hansen, for the responsibility of a blatant miscarriage of justice, by direct participation or passive acceptance.

During the last one thousand days (and nights) I have been incarcerated 23 – 24 hours (for most days) in a cell (less than eight square metres). I have neither been convicted nor received any judgment.

 

Furthermore, the alleged offence was that I was arrested for was tax evasion that I have neither been charged nor indicted for. There is absolutely no evidence that I have committed any offences and I am blameless of the Prosecutions intrigues and innocent of all charges.

I was locked up in Solitary Confinement for more than three hundred days during which I was subjected to mental torture and considerable suffering. All of the methods used were and are against the European Convention of Human Rights.

On the 31st January 1980, the Special Danish Public Prosecution for Particular Economic Crimes (SØK, Bagmandspolitiet), arrested me and at the same time raided my companies’ offices without having received any complaints.

The companies had fulfilled all of their obligations until this event, confirmed by the prosecution auditors. 

All of this was seen on the state-run television the very same day. The raid was pre-planned months ahead by the fiscal authorities because the aim was to create embarrassment, disarray and mistrust among investors in precious metals and other tangible investments.

Therefore it was important to cause maximum losses for the investors and companies through the use of the media providing false allegations, lies and a general cover-up of the truth e.g. Mogens Hauschildt being incarcerated in Solitary Confinement.

The allegation for tax evasion, which was “used” to arrest me with, was fabricated by the authorities in order to legitimise their illegal action and abuse of power. The allegation was fictitious and never resulted in any indictment; there was no tax evasion.

Prosecutor Finn Meilby (Chief of Bagmandspolitiet) told the newspaper POLITIKEN  on the 1st February 1980:

“Bagmandspolitiet have felt, for various reasons, inclined to investigate Scandinavian Capital Exchange business closely and compare information from tax authorities and the Custom and Excise Office and have, through this, found reason to charge for tax evasion”

From the first day of this miscarriage of justice, there has been a closed concerted conspiracy between the Prosecution, which they have themselves “fabricated” and thus instigated the case, the fiscal and financial authorities in Denmark, the courts and the Ministry of Justice. The Prosecution (SØK) have been in full control and I have, as the Professor of Law, Ole Krarup, has said: “played chess blindfolded”. The Special Public Prosecution (SØK) has regularly ignored the law and is responsible for:

• Manipulation of witnesses.
• Destruction of seized materials and papers etcetera
• Execution of mental torture.
• Circulation of lies and false allegations to the media.
• Falsification of the companies’ accounts and reports.
• Concealment of important information and evidence.
• The raid itself which closed the companies and created considerable losses for clients and my companies.
• Blackmail, extortion, harassment and menace.

I have been prevented from having a proper defence and the Copenhagen Municipal Court (Lower Court) has, with its judiciary judge, been able to regularly blatantly ignore the law. Judge Claus Larsen has been directly responsible for:

• Manipulation of witnesses and court records.
• Approved the Prosecutions use of mental torture, extortion and harassment – a pre-trial punishment.
• Fabricated court transcripts with a total contempt of the truth.
• That the accused and the defence have not received reasonable working conditions, means and general fair treatment for the defence to defend the case.
• Refusal to examine more than 90% of the people who were included in the manufactured charges and cases and to whom the defence wished to bring to the trial hearing.
• Fraternisation with the Prosecution during the trial.
• To permit that the prosecution never provided the accused and defence with a clarification and definition of the allegation and the indictment.
• To refuse the accused the possibility to rectify the enormous amount of lies and false allegations made by the Danish media, orchestrated by the Prosecution.
• To permit that the Prosecution created millions of Kroner in losses, for the clients of the companies causing tragedy and suffering of many people.

There exists no concrete evidence that I have committed any violations or any wrong doings prior to my long pre-trial incarceration and pre-trial punishment.

Although I have participated in one hundred and seventy court hearings, neither I nor my experienced defence council have, even to this day, any knowledge of what I possibly could have done wrong.

The Special Prosecution had used one hundred and thirty court hearings during the trial itself to try to justify and substantiate their conspiracy and their abuse of power.

My previous defence lawyer, Jørgen Jacobsen, said to the court:

“That the prosecution could as well hold their Court hearings at their own offices without the judges, the defence and the accused – the result would be the same.“

My present defence lawyer, Folmer Reindel, has said to the court:

“I feel I have been reduced to a defence counsel in a Russian Military Court.” How can such things happen in Denmark? It is only possible because the Special Prosecution (Bagmandspolitiet) is a combination of Public Prosecution and Police, without any control, transparency and accountability placed under the Ministry of Justice. A Ministry of Justice, who appointed judges.

This Ministry of Justice appoints the judges from its own ranks and they must give permission to the defence if they wish to appeal any decision to the Supreme Court which, in turn, considers all complaints about the Prosecution and indeed the court proceedings. Hence their power is total and complete – no transparency and no accountability.

Irrespective of what conclusion the judge at Copenhagen Municipal Court Department 8 (the lower court) would reach sooner or later, a miscarriage of justice is an irreparable factor, a factor which reflects the law and order in Denmark today.

A country’s reputation stands or falls on its “law and order” and on its politician and civil servants accountability.

 

Mogens Hauschildt

 

Bagmandspolitiet Destroyed Evidence

It was clear that the Special Prosecution had suppressed evidence and misused documentary material papers seized at the offices of SCE. Such documents which were clearly to the benefit of the defence just disappeared.

Some documents first came into the court’s archives after the defence and I had been able to “find them” hidden among the seized material. These documents, which Bagmandspolitiet had had in their possession for years, were seized on the first day from my offices.

It was a fact that many important papers had either been lost or hidden or simply taken beyond any possible use by the prosecution. Even a typewriter ribbon (from an IBM typewriter) seized from my prison cell just disappeared because no doubt, it would have helped my case. When such grave mischievous actions can be exercised by the Special Prosecution without the interference of the court, it is hardly difficult to imagine the consequences.

I played chess blindfolded

Professor of Law, Ole Krarup, said that “I played chess blindfolded“. I did indeed and there was nothing neither I nor my defence lawyers could do about this injustice.

High Court Judge Holger Kallehague, who has always been outspoken, not controlled by the government, said to Politiken newspaper (12th September 1982) that I was subjected to the same treatment and “injustice” as the suspected witches five hundred years earlier.

When later on the European Commission of Human Right asked Denmark to reply to my complaints, the Danish Government explained the Danish system of justice and referred to the fact that “grave offences are decided by a jury of twelve persons without participation by the juridical judges”. However, they did not explain that in my case the Special Public Prosecutor had pleaded to the Court to sentence me according to a special section of the Danish Criminal Code (Section 88) which could have meant a sentence of up to twelve years. Such a sentence must, under all circumstances, be considered relevant to a “grave offence” and sentences of twelve years are very rare in Denmark. Against the background of a possible sentence of twelve years, I was to be judged by one juridical judge who was not only extensively involved prior to the indictment and trial but had made thirty-nine decisions to keep me incarcerated including in solitary confinement.

High Court Judge Holger Kallehague said to Politiken on the (12th September 1982) that:

“I was subjected to the same treatment and “justice” as the suspected witches five hundred years earlier. They would bind the poor woman, put her into a sack and fill the sack with stones after which they throw her into the water. If she drowned she could not have been a witch and was innocent, however if she got free and came to the surface, she must have been a witch and was burned alive at the stake.

The influence of the two lay judges (housewives) was as negligible as one would expect. Claus Larsen, acting as a henchman for his masters, was to be my judge in the so-called trial after he had made close to seventy decisions against me and the defence.

It’s no wonder that my defence lawyer Folmer Reindel said, “I feel that I have been reduced to a defence counsel in a Russian Military Court.” But that was after another one hundred and thirty court hearings of “trial” where Claus Larsen presided alone with the two housewives acting as lay-judges. 

”I feel that I have been reduced to a defence counsel in a Russian Military Court.” –

Advocate Folmer Reindel to the City Court

My first defence attorney advocate Jørgen Jacobsen’s statement to the Court:

“The prosecution could as well hold their “court hearings” at their own offices without the judges, the defence and the accused – the result would be the same.”

This statement was factual and sadly correct. Two years later my other defence attorney, Folmer Reindel, told the court that he was reduced to a defence lawyer in a Russian Military Court!

Bagmandspolitiet directly prevented me from having my complaint about my long solitary confinement and atrocious treatment dealt with by the European Commission of Human Rights. Bagmandspolitiet held back all correspondence with the Commission for more than 24 months. A serious breach of the Convention.

Bagmandspolitiet kept a letter for more than two years away from showing me; totally contemptuous of the convention as I was allowed free uncensored communication in accordance with the European Convention of Human Right. Bagmandspolitiet just ignores all of the Convention.

There can be no doubt in my lawyers and my belief at the time that this was a deliberate act as the Danish authorities did not want my treatment to be subject to a case at the European Court. When I sent my first letter and application to the ECHR in August 1980 and did not hear anything for more than two years and 2 months, I felt that something had happened, but I did not know that

Bagmandspolitiet had kept the letter away from me. The fact that I did not know about the letter in September 1980, prevented me to follow up and ultimate from the commission dealing with my atrocious treatment by the Danish authorities. At the outset of the trial in the lower court (Copenhagen City Court), my defence attorney Folmer Reindel said to a leading newspaper, Berlingske Tidende:

“With the collaboration between the judge (Claus Larsen), the prosecution and the prison services, which consequences seriously affect and prevent the defence – I fear a miscarriage of justice”

It was obvious to everyone except the tabloid press

Agent Provocateurs

In late 1979, several incidents took place where people came to SCE and told us various “stories” asking for advice and assistance from the company. At the time we thought that these people must have been sent by the National Bank or the fiscal authorities. Considering the seriousness of such provocateurs, I asked the staff to report such incidents directly to me, moreover, be observant and vigilant.

We listed several incidents and in one case I recall a woman pretending to be an investor and claiming to have D.Kr 2 million to invest in silver bars. She told the staff that she had made this money in Greenland and really wanted to take the money out of Denmark. In buying silver bars, she could transport them across the border and sell them outside of Denmark one day. Silver bars were considered as “goods” and subject to sales tax and the EU laws of free movement of goods. We refused to assist her since it could be seen as a way around the strict Danish exchange control regulation at the time.

She and the other people were all agent provocateurs sent by the Special Prosecution. Two weeks previously Bagmandspolitiet had already stormed the companies and arrested me after employing an outside accounting firm to help them against me and the companies – considering this, it showed their work behind the scene (this firm ended up making more than D.Kr.4 million in fees).

According to what came out in the High Court during the so-called appeal, Bagmandspolitiet sent a person in early January 1980 to my companies to seek employment, even calling me personally several times and having a serious meeting with us as to working for one of the companies.

Report from the Danish National Bank

An internal report from the National Bank in May 1979 showed that the bank had been unable to find any investors who had had any complaints against the companies and me and it had not been possible for the police to raise a case. This report came to light during the trial.

According to this internal memorandum the meeting was held in the National Bank in May 1979 which concluded that it has not been possible to find customers of SCE which would complain of any wrongdoing with regards to the companies and its owner (me).

Further, that investigation by the Bagmandspolitiet has not been “successful” and no person has been misled or defrauded in any way. However, the National Bank wanted to still go ahead with the possible violations of the exchange control.

Further, the report confirmed that the companies operated within the current law. Another internal report from the Copenhagen Tax Authority in October 1979 and the Danish National Bank, four months before the closing of my companies, showed that there were no clients of the companies prepared to make a complaint against the companies as they had nothing to complain about.

All clients had been satisfied in their dealings with the companies. Moreover, the report confirmed that SCE had no legal obligation to hedge the forward sale of precious metal on margin purchase (Deferred Delivery Contract). This report was made by Christen Amby (see The Red Tax Troll ), who later in the High Court admitted that the fiscal authorities wanted details as to who was the companies’ clients and to find out if they had undeclared (un-reported) money (black money).

No doubt that this was of great concern for the fiscal authorities, however, the current tax rules at the time did not require the companies to register the personal details of the client who purchase precious metals and coins over-the-counter. They could provide any name without documentation and pay cash for their investment. We did not have any legal requirement to ask for documentation nor from where they had their money. Since everything was legal and indeed transparent, we had nothing to hide.

We had staff that had close relatives working in the National Bank and we even employed a retired senior police officer to supervise the transport of our precious metals. I employed these people, and I at least expected them to report back to their relatives and families that we did nothing wrong or against the law and that we only operated according to all the rules set out by the government and the National Bank.

We were blackmailed regularly by the Copenhagen Tax Authorities (Københavns Skattevæsen), who wanted access to the names of our clients and their transactions. On one occasion in 1979, they demanded that we pay tax there and then on all future income despite losses in the previous year (we had handed over D.Kr. 200,000; otherwise the tax inspector would not leave our premises).

Making matters worse, we were regularly prevented by the National Bank from being able to hedge our currency and commodity transactions, creating considerable losses for the companies and at times, leaving business transaction as too risky to enter into. The National Bank put pressure on our banking relationship and in one case, created a huge loss for my companies with Andelsbanken, one of the banks we used.

None of these facts was ever reported in the Danish media.

Lies, Damned Lies and Bagmandspolitiet

As I have listed many other places here, creating lies and the manipulation with the truth and cover-up was really what Bagmandspolitiet was very good at – nearly as good as Stalin’s and Hitler’s propaganda ministries.

When Bagmandspolitiet was making out to the Danish public that I and my companies were “criminal” by using lawyers offices for companies registered in the respective countries such as Liechtenstein and not employing any staff.

That this was “criminal” somewhat showed the political attitude at the time, something which still prevails among many Danes. It is a well-known fact that so many offshore companies and indeed US, Dutch, Irish and the even UK holding companies do not employ any staff and as Bagmandspolitiet claims are just “post-boxes” with no real activity behind. Major Danish and Scandinavian companies have together many hundreds of such offshore companies today, but many of these companies did also have such offshore entities back in 1980. Børsen newspaper wrote about the Danish banks’ offshore activity in 1982 in various financial centres (see: Børsen 11th October 1982 Danske Banker offshore)

All the world largest companies use offshore companies for fiscal purposes, companies like Google and Microsoft use companies in Holland, Bermuda and indeed many other places without anyone employed, all just registered at a law office. This has according to the British newspaper Sunday Times saved Google alone in the last 5 years more than US$5 billion in taxation, all legal.

Moreover, international banks and financial institution are the biggest users of offshore locations saving their shareholders lots of money. (see: Britiske Barclays betalte kun 1 pct) I know of several Scandinavian companies which for many decades has used “post-box” offshore companies to save billions in local taxes. In fact some companies I assisted to establish back more than 35-40 years ago exist today.

Last year Berlingske Tidende reported that the Danish tax authorities were examining the transfer to 50 countries by 20 Danish banks with more than 100,000 companies and individuals in the spotlight. They were looking for hidden assets in offshore places to tax. (see: Skat opsnuser danske formuer i skattely).

I recall years (45 years) back that all international banks could move around their profits from one location to another using various financial instruments, likewise for the large multi-national corporations. I will still claim that all international companies have an obligation to their shareholders to maximise their resources including saving taxation from their income. The recent revelation as to Apple’s profits and saving in taxation makes my point that such practise prevail today (see: How Apple Sidesteps Billions in Taxes). Apple paid cash taxes of $3.3 billion around the world on its reported profits of $34.2 billion last year (2011), a tax rate of 9.8 %.

The banking sector has the largest number of tax haven companies

In the UK alone the big four UK banks – HSBC, Royal Bank of Scotland, Barclays and Lloyds – having a total of 1,649 offshore subsidiaries (according to the Guardian newspaper November 2011). They have the largest number of companies registered in the Cayman Islands, with Barclays alone registering 174 subsidiaries and ventures there. HSBC has 156 subsidiaries in Delaware, which has limited reporting requirements, compared to 97 in the rest of the USA. Lloyds Group has 97 companies in the Channel Islands. The 100 largest groups registered on the London Stock Exchange have more than 34,000 subsidiaries and joint ventures between them. A quarter of these, over 8,000, are located in jurisdictions that offer low tax rates or require limited disclosure to other tax authorities. (see: Quarter of FTSE 100 subsidiaries located in tax havens).

The British Prime Minister David Cameron’s father ran a network of offshore investment funds to help build the family fortune that paid for the prime minister’s inheritance. Though entirely legal, the funds were set up in tax havens such as Panama City and Geneva, and explicitly boasted of their ability to remain outside UK tax jurisdiction. (see: Cameron family fortune made in tax havens). Even today, the Danish media at the time makes “stories” as to the use of offshore places and indeed banks giving client fiscal advice. (see: Danske virksomheder strømmer til skattely).

Even the Danish states activities go via offshore locations (see: Et skuffeselskab i Mauritius, Berlingske Tidende  8th June 2011). Back in the sixties, I together with partners launched the first comprehensive research into offshore funds for institutional investors and held the first offshore funds’ conference in London at the Dorchester Hotel. I had previously back in 1966/67 worked with highly respected British barristers, including Justice Parker QC who drafted the Cayman Island first laws and the foundation to make it offshore heaven for financial institutions in the last forty years.

Offshore funds investments become important in the main investment markets from the mid-sixties and since they were not subject to regulators and in most cases had no reporting requirement (even to their investors) these funds were able to do many things which local institution was prevented from. (See our brochure: Offshore Funds Analysis)

Our research into the offshore investment funds was used by the Special U.S. Congressional investigation into offshore funds in 1969-1970 and I even received a paycheck from the US. Treasury for the work I did at the time. So I knew everything which was worth knowing about offshore places and their fiscal benefits.

At the time of my arrest, I had been operating M. Hauschildt et Cie in Zurich for six years and my partner was the British Consul in Liechtenstein, also specialising in fiscal matters.

Danish Defence Lawyers (1980)

All Danish defence lawyers at the time (1980) took their appointments directly from the Ministry of Justice; they all had to see their fees’ being paid by the same people who they were defending their client against. What made matters worse was that in each case the judges had to consider the defence’s expenses so that all defence lawyers had to plead with the judges as to being paid for their work. This ultimately meant that no lawyer, with any respect for himself, wanted to be a criminal defence attorney at that time.

The few defence lawyers were either truly devoted to “the call to defend” with mostly a left (politically) orientation or lawyers who could not survive in commercial practices and had to depend on the state so to say.

One of the defence lawyers who were known to not be able to maintain a “commercial legal” practice was Erik Ninn-Hansen, who at the time was the longest-serving Member of Parliament. That he was not able to maintain a “proper” legal practice, I was told by none other than the leader of the conservative party Poul Schlüter who was later the Prime Minister during my pre-trial detention and punishment.

One weekend morning he and I were driving to a hunt, Schlüter told me that Ninn-Hansen (forgetting about himself) was not able to run a law practice and therefore he had to be a “poor” defence attorney. Nevertheless, when Schlüter became Prime Minister he appointed Ninn-Hansen to be the minister of justice and later when exposed, Schluter made Ninn-Hansen the Speaker of the parliament until they all had to resign due to a scandal.

When I became the spokesperson for the prisoners in Vestre Fængsel, I used to recommend Ninn-Hansen to defend members of Hells Angels and other such groups since he appeared to the court to be a decent man. Because of his parliamentary status, he came across very sincere and genuine to the courts.

Later when Ninn-Hansen became the Minister of Justice, he conspired with others in unlawful and criminal acts in the so-called Tamil Case. However, as to the use of pre-trial solitary confinement, he had to accept everything the civil servants in the ministry wanted and had no individual say as to the use of solitary confinement.

Despite Ninn-Hansen speaking out against the use pre-trial solitary confinement in March 1980 mostly being used as mental torture for getting confessions, and even saying it was against the Law, he silently approved the use of this torture – or “confession arrest” as he called it during his term of office. Erik Ninn-Hansen (former speaker of the parliament and longest-serving member), stated in 1980:

“That solitary confinement today is used less to avoid detainees from communicating with others and more to squeeze out a confession.” Ninn-Hansen observed that “solitary confinement is a commodity” and remand prisoners could free themselves from isolation at the price of a confession 

See:  Isolation som pressionsmiddel – 23rd March 1980

Interestingly Ninn-Hansen, later on in life, made a complaint to the European Commission of Human Rights as a victim complaining that the Danish judges in his case were not independent and unbiased; he should have known as a defence lawyer for many years and serving as Minister of Justice. He also complained that his case was not tried within a reasonable amount of time.

My First Defence Lawyers

Immediately after my arrest, I found myself with a lawyer who was a “defence advocate by heart and soul”; attorney Jørgen Jacobsen, who was appointed on the first day to defend me. Appointed is the right word since it was an appointment with all the restrictions and rules of the land at the time; however, the rules were given to him by Bagmandspolitiet.

As a decent person, he had to ultimately surrender and stand aside from my defence. He realised there was truly nothing a defence lawyer could do and perhaps he did not want to spoil his reputation, after all, he and I knew that I was being led to the slaughter. I had previously heard about Jørgen Jacobsen because he had a good reputation; moreover, he had been an active freedom fighter during the Second World War and a member of the Communist Party for many years. Despite this background, I respected his experience and professionalism as a committed defence advocate – one of the truly great Danish advocates. He realised very early that there was absolutely nothing he could do for me and he hated to be sitting on the side watching all the injustice. He said several times:

As a professional defence advocate, he was used to winning cases and he knew this case was a dead loss after the authorities had used every possibility to justify their actions in the Danish media. After all, he told me in early July 1980. I did appreciate Jørgen Jacobsen’s TRUTH, but I never expected 1492 days of injustices with all the devastation to my family, the companies, clients and staff.

Jørgen Jacobsen spoke out as much as he could and even beyond the call of duty. One day in court he said, “It is just like hitting into a pillow, Bagmandspolitiet has total control of everything together with the Ministry”. He went as far as to tell the Danish media (TV and newspapers) that all defence attorneys in Denmark should go on strike and show their strongest objection to the use of pre-trial solitary confinement, which he considered rightly as mental torture.

Jørgen Jacobsen actively campaigned and told the press that Bagmandspolitiet used psychological torture against me, he also encourage me to complain to the European Commission of Human Rights as to the many aspects of my arrest, the so-called investigation, the lies in the media as well as all of the pre-judicial aspects, the restrictions for the defence and my pre-trial solitary confinement torture. He rightly predicted that Denmark would have a case to answer at the European Court of Human Rights. However, at the time he expected that the issue would be my solitary confinement and treatment by Bagmandspolitiet with the arrest and “made-up” charge of alleged tax evasion.

What he did not know was that for more than 24 months, Bagmandspolitiet kept a letter from the European Commission for Human Rights – a total disregard to my rights and Denmark’s commitment to international law. The fact that I did not receive this letter at the time prevented me in getting the European Commission for Human Rights to deal with my pre-trial punishment and the solitary confinement.

Through all the years I had contact with the European Commission of Human Rights, the Special Prosecution opened the letters first to read, despite I had the right to receive such letter un-open and read by the authorities. When an experienced and highly respected defence attorney makes such a strong statement, one should take note, but the Danish media did not bother because they had a different agenda – helping the authorities to cover up their injustices.

”The prosecution could just as easily hold their “court hearings” at their own offices without the judges, the defence and the accused – the result would be the same.”

Advocate Jørgen Jacobsen told the court He also said that the case should be seen at the Danish Royal Theater since there was more seat to fool and impress the public, although making a mockery of justice. Considering Jørgen Jacobsen’s health at the time and the amount of work he had with the case, his colleague Manfred Petersen assisted him in my defence prior to the trial. However, as Jørgen Jacobsen had told me several times, the pre-trial punishment had to be justified by the authorities; leaving me already sentenced before the trial as well as already having been sentenced by the press.

Advocate Jørgen Jacobsen rightly predicted that Denmark would have a case to answer at the European Court of Human Rights one day – however it took more than 9 years.

When I later made my application to the Commission of Human Rights, I had no lawyer or jurist to help me. I asked my defence lawyers (then Folmer Reindel and Korsø-Jensen) and was told that there is not one lawyer in Denmark that really had the experience in the European Convention of Human Rights (despite that the convention had existed for nearly forty years).

Worst of all, there was no lawyer prepared to go up against Denmark (meaning the Ministry of Justice). Moreover, if I could find someone to take on the case, where would he or she get their fees from? All of my assets in Denmark had been seized by the prosecution and liquidators and I had no access to my assets abroad.

My Second Defence Team

The two defence lawyers I ended up with had lots of experience in commercial and civil matters but very little in criminal law at the time. Folmer Reindel, a real Dane, whom I had met privately some years earlier, was a person with strong ideals and convictions. Folmer Reindel only took the case because he believed I was innocent and that he could win – yet he had only had a few dealings with Bagmandspolitiet. It was extremely difficult for him to witness what took place in the courts and to see how the Bagmandspolitiet, the Ministry of Justice and the tabloid media could manipulate the court and justice; this was something he really could not stomach, he had to speak out.

Folmer told Geoffrey Robertson, my British barrister, that he was overwhelmed and disappointed as a Dane when he witnessed what the Danish authorities did against my profitable companies and me. This motivated him to defend me, despite the fact, that he was not a criminal defence lawyer. He had to do something and initially thought that he could get the truth out to the Danish public.

Folmer was shocked to see how the Danish authorities were able to fool the public, with a propaganda machine of lies through many years; they were regularly feeding the tabloid press with sensational fake news. How the Special Prosecution made sure to keep me as a hostage day by day, week by week, months by month – for years. The Special Prosecution knew that the High Court judges would have to justify the incarceration on remand at least; after all, they had for years confirmed the lower court’s decision.

Folmer Reindel was a straight person and he did not accept possibly as other defence lawyers anything from his clients which could indicate any wrongdoings. Moreover, he would endlessly question me very critically and indeed objectively on all my actions and motives in my business, before he made any statements to the court and the media. So when advocate Folmer Reindel spoke out against the injustice against me and the companies, such statements came from a decent person who had looked truly objective at the evidence in front of him. To me Folmer was a real Dane and Viking.

Folmer knew what he spoke about. He many times complained to the Minister of Justice and the Ministry but without any positive responses. One day in court – just before the end of the trial in the lower court – Folmer Reindel said:  “I feel that I have been reduced to a defence counsel in a Russian Military Court.”

Folmer Reindel had to speak out as to the injustices and what he witnessed in Denmark; he fought on years after my case. Sadly too few bothered to take note and he died too soon. A good human being, friend and advocate in need. Folmer took an active part in exposing the bad parts of the Danish justice system and the fact that the Ministry of Justice controlled everything including the judges.

All judges had to show their loyalty to the Ministry and could therefore not be independent and unbiased. (See an article by Advokat Folmer Reindel om Retssikkerheden )

At the beginning of the High Court trial, Folmer Reindel told Berlingske Tidende newspaper that “I faced the choice between being hanged or burned as to the appeal”, confirming that I could have been a free man prior to this so-called appeal process; and not kept incarcerated for another year in pre-trial detention, awaiting the outcome of the appeal.

At least many years later I could involve Folmer Reindel in something positive, namely, what become Saxo Bank. Folmer served many years as director of the company and took care of legal matters. As to my other defence lawyer advocate John Korsø-Jensen, he had a considerable reputation and experience in academic and commercial business.

I had never felt that Korsø-Jensen could become truly surprised by the Special Prosecutions ability to manipulate the courts and their treatment of me. He had already seen how Bagmandspolitiet “worked”, as Jan Bonde-Nielsen’s defence attorney. Nevertheless, Korsø-Jensen did fight for my innocence and went into everything with a critical mind and the experience of a business lawyer and academic.

If the truth is told Korsø-Jensen never did get paid for his time and work. He already than enjoyed a high reputation as a business lawyer and served later as a director at Saxo Bank. In addition to many other restrictions, considerable restrictions were put upon Korsø-Jensen’s engagement as my defence lawyer by the fact that he did not get paid much for defending me through all these years.

“Hauschildt you have been selected – and judged. You were selected because you are a “foreign Dane” with no political affiliation or power, you work in a business which daily deals with Swiss banks, New York and London – movement of money and in a financial market most people in Denmark do not know and can’t participate in, you controlled your business and do not employ many people, not like a factory owner.”- 

Advocate Jørgen Jacobsen

I did consider a change of defence lawyers before the High Court appeal, but the truth is, there was no experienced criminal lawyer in Denmark who would take the case. Moreover, I was not able to use my assets outside Denmark, as they would be seized. Therefore, the money was too little and they knew this as well as that the many years of pre-trial detention and punishment had to be justified – “You can’t fight City Hall”

The Special Prosecution spent tens of millions on the case, including more than D.Kr. 4 Million (700.000 plus USDollars) to an accountancy firm. My defence lawyers received less than D.Kr. 300,000 each (40.000 US Dollars) for their one hundred and forty-seven court hearings in the Lower Court and each time they wanted to be paid for their work, they had to fight for their fees and expenses with judge Claus Larsen, even going to the High Court and the Supreme Court – just to get paid from time to time.

The Real Background – Fiscal Conspiracy

Taxation – The BIG Issue

Taxation was a primary issue and motive for the authorities, however only a secondary issue in my personal case, since they knew that no tax evasion had been committed by me personally. Nevertheless, they had to use this alleged fiscal claim against me in order to get the arrest and search warrant to carry out the whole action on the 31st January 1980.

4 days after my arrest the newspaper headlines report that the Danish fiscal authorities NOW got involved in a fraud case? – Stupid press, they started it!

Although I never did see the details as to the warrant for my arrest, some details came out later during the trial, where my defence found that a loan I had received from my company in Switzerland, M. Hauschildt & Cie back in 1976 for Swiss Fr.450,000 was considered as income by the Danish fiscal authorities, after more than 3 years and having accepted all my tax returns.

Firstly, I was not subject to Danish tax before I purchased a property in Denmark in 1976; secondly, the fiscal authorities had approved my tax returns for 1978 and the previous years. None of my advisers such as accountants and auditors knew anything about the tax allegations. My 1979 tax return was not due for filling at the time of my arrest.

A loan giving to me 4 years before and indeed prior to me and my family moving to Denmark was used for the warrant for my arrest and the closing of the companies?

Frankly, neither the defence nor I know the details of this warrant. I never saw it, but it goes to show the trumped-up charge used by the Danish authorities to close the companies and lock me up in solitary confinement for open television screens.

The Danish authorities had hunted the companies and I for close to five years before and they had tried everything including harassing me and the management of the companies on a daily basis, however, they were never able to do much with regards to the law, since we did nothing wrong or illegal. In fact, this was also the conclusion of Christen Amby, the deputy chief of the Danish Tax Department in an internal memorandum to the Danish National Bank in October 1979. (See also: The Red Tax Troll)

The fiscal authorities regularly harassed the companies and tried to “blackmail” the companies (and me) to inform on clients and people who purchased metals and coins over the counter – and then just took them home.

Just imagine you arrest the owner of a financial service company for alleged tax evasion four years back and throw him in solitary confinement. This is after the Revenue had accepted all his tax returns to date, without informing him and his advisors that there is a question as to this loan four years earlier – they just arrest him in front of open television and close his business. Moreover, the Special Prosecution claimed that we had a turnover of D.Kr. 500 million and this loan was only D.Kr. 1.4 million. This was in Denmark not in Russia or DDR.

We Will Close This Capitalist Cave!

Leaving our head office in June 1979, the vice-director for the Danish Tax authority, Christian Amby, shouted “We will close this Capitalist Cave”

As the founder of the Danish North- Korea Friendship Association and co-founder of the Danish Left Socialist Party he clearly did not like that we did not hand over details as to our clients’ activities. The fiscal authorities created a fear campaign to stop “ Tax cheats” putting real fear into people.

In 2013 the tabloid newspaper B.T. published information from the Danish Secret Service PET, claiming that Christian Amby had regular talks with a KGB officer and kept a detailed record on 2000 Danish police officers. I was not surprised. 

Fear campaign to stop tax cheats

Even prior to me starting SCE in Denmark, I had several meetings with senior people in the Ministry of Trade and the National Bank, in order to make sure that everything we did was legally correct and was within the law and within the various restrictions that Denmark imposed on our business. During the years 1974 – 1978, the company sold platinum, palladium and silver bars over the counter, in addition to bullion coins (gold coins like the Kruger Rand).

The company advocated investors to diversify their investment, so they invested 10-15% of their money in the precious metal as an insurance against inflation and stock markets crash. Moreover, it was important for these investors to have delivery of their precious metals and coins – as insurance against any major upheaval.

Thousands of investors took our advice and purchased (through the years 1974 – 1980), gold, platinum, palladium and silver in bars and took delivery themselves. Also, many investors purchased gold coins for cash over the counter, which the company had advocated for years. Investors who did buy at the time had to wait many years, but today they can look back on investment with good profits of up to 600 – 1200%. I hope that the many investors who took our advice enjoy their profits today.

“The Danish National Bank, the Ministry of Trade, the Company Register and Copenhagen tax authorities all conspired against Hauschildt and the companies whilst using the involvement of the Ministry of Justice, the Special Prosecution, the tabloid media and courts as henchmen”

– Advocate Folmer Reindel to the City Court and 8 years later to the European Court of Human Rights in Strasbourg

The Danish revenue was concerned for years as to investors using so-called “black money” and unregistered cash. Such activity would be reluctantly accepted if it was only relatively small amounts; however, in view of the substantial investments in 1979/80, this became a larger “problem” as such. In addition to this, since there was no precedence or effective rule, certain conditions were not evident. Because EU considered precious metals and coins as goods and in Denmark, goods were subject to sales tax (MOMS). Moreover, it was not a requirement by Danish law that clients had to show any documentation or be registered when buying precious metal “over the counter”. Therefore, the fiscal authorities had no record of these people’s names. The companies were subject to many visits by the Copenhagen Tax office, including by the deputy chief of this office, Christen Amby.

Christen Amby – The Red Tax Troll

The companies were subject to many visits by the Copenhagen Tax office, including by the deputy chief of this office Christen Amby.

Christen Amby, the person who my companies and I was harassed by through several years was none other than “a red socialist” or should I say a left-wing socialist and the founder of the Danish Friendship Association with North Korea. He had previously been active in Danish Socialist People’s Party and later co-founder of the Left (wing) Socialist Party where he failed to get voted into the Danish Parliament.

Christen Amby according to friends used to say about the people who worked under him in Copenhagen Tax Department “Either they are red or otherwise dead”. Such a person was one of the prime movers against me – “A Capitalistic Pig” as I several times had been shouted at. Such a political animal like Christen Amby should not be allowed to serve as a civil servant, civil servants should be the servant of the people and government, not by their political conviction.

Such people regularly harassed the companies and tried to “blackmail” the companies (and me) to inform on clients and people who purchased metals and coins over the counter – and just took them home.

The Customs and Excise Office was responsible for the value-added tax on goods. When SCE was a small company, the Customs and Excise Office agreed to permit that the sales tax/value-added tax (MOMS) could be refunded when the customers sold their goods and contract.

With regards to the deferred deliveries of the goods where most clients did not want delivery, and thereby in most cases – no import; therefore purchase tax on import was not possible. No doubt, these matters did concern the Customs and Excise Office; they saw the amounts growing larger into millions of Kroner.

During the years that the companies operated (1974 – 1980), Denmark had currency restriction and therefore Danish investors could not invest or take part in the speculation on the stock and commodity exchanges in London, New York and Chicago.

“The Danes have started to go back to gold” The newspaper informs it, readers, that collections of gold coins and diamonds are not subject to taxation on profit. The last fact was changed retrospective by law! Not a proper democratic state worthy.

SCE introduced, for the first time to Danish and Scandinavian investors, the opportunity to buy precious metals, gold, silver, platinum and palladium, indeed other forms for real assets including precious stones.

Since I had expected the Danish currency restriction to be lifted, at least some years after Denmark’s membership of the EU, allowing Danish investors to invest and speculate on the overseas stock and commodity exchanges, I somewhat became concerned in 1978 when Denmark still did not allow a Dane to take more than DKr. 5,000 abroad. Moreover, despite the EEC (EU) membership, Danes were still very restricted in what they could do with regards to investment abroad.

The restriction was even worse in Sweden and Norway. That taxation was an issue; it became obvious from the various statements made to the media on the 31st January by the heads of Bagmandspolitiet, including Finn Meilby and Mogens Kanding. Moreover, all the Danish newspapers front page headings the day after the raid and the arrest, related to the fiscal background for the case:

Børsen, Friday the 1st February 1980 Frontpage headlines:

The Special Prosecution closes Scandinavian Capital Exchange – Making charges for serious tax evasion against Denmark’s largest bullion dealer – Precious metal dealer accused of tax evasion Police close Scandinavian Capital Exchange Scandinavian Capital Exchange has been closed by Bagmandspolitiet. “Through channels which we control we have found out that possible serious tax evasion has taken place, according to the criminal code paragraph 289 tells Mogens Kanding Børsen”.

Mogens Kanding, criminal commissioner from Bagmandspolitiet continued telling Børsen:

“We will go through all the material and specially concentrate on the companies order confirmations and dealings with its clients since we wish to double control on these client’s tax returns. At the same time we want to concentrate to see if there has been any wrongdoing by the company, as an example if we suspect any fraud against the clients, we will contact these clients and ask for their version.”

In reading the whole article, the reader must get the impression that the Special Prosecution was on a “fishing expedition” and that serious tax evasion must have been committed and that the fiscal authorities wanted to see investors’ tax returns and that the only way to do it was by closing the companies and later making out that I was responsible for the investors losses.

It is important to note the fact that Mogens Kanding tells the newspaper that Bagmandspolitiet would contact the companies’ clients and ask for their version – of what? This being done after the closing of the companies giving some of these client losses – what should client say?

Cardinal Richelieu understood the value of surveillance when he famously said:

“If one would give me six lines written by the hand of the most honest man, I would find something in them to have him hanged.”

Jyllands-Posten, Friday the 1st February 1980 Criminal commissioner Mogens Kanding Bagmandspolitiet tells Jyllands-Posten:

“We have been investigating the company since it started (1974) just to see what is happening. Approximately three weeks ago our investigation became more intensive on our own initiative. We have not received any complaints“.

Jyllands-Posten: Is there only a question of tax evasion? Yes, at this time Jyllands-Posten: How big amount is in question? This we can’t inform you about.

Bagmandspolitiet has been investigating the company for more than five years just to see what? Just like Stasi or KGB. As Stalin said, “Show me a person and I will always find a reason against him” (to kill him or send him to the Gulag).

In the companies, we knew that the Danish the authorities had been harassing us constantly for years, but we did not know that Bagmandspolitiet was involved, see: Five years of continuous harassments before the event.

No complaint had been made to the police and the Special Prosecution. The fact that they later claimed that the Copenhagen fiscal authorities had asked a judge for a warrant for my arrest for tax evasion – is another matter

Nevertheless, according to the newspaper and what they were told Bagmandspolitiet decided themselves to take the action. Further, that black money is invested in precious metals and the profits are tax-free outside the reach of the fiscal authorities.

I was never charged with tax evasion, since this was a trumped-up charge and there truly was no tax evasion by me or the companies.

We were blackmailed regularly by the Copenhagen Tax Authorities (Københavns Skattevæsen), who wanted access to the names of our clients and their transactions. On one occasion in 1979, they demanded that we pay tax there and then on all future income despite losses in the previous year (we had handed over D.Kr. 200,000; otherwise the tax inspector would not leave our premises).

We had staff that had close relatives working in the National Bank and we even employed a retired senior police officer to supervise the transport of our precious metals. I employed these people, and I at least expected them to report back to their relatives and families that we did nothing wrong or against the law and that we only operated according to all the rules set out by the government and the National Bank.

Making matters worse, we were regularly prevented by the National Bank from being able to hedge our currency and commodity transactions, creating considerable losses for the companies and at times, leaving business transaction as too risky to enter into. Because of the considerable volatility in the currency rates, this represented sometimes much bigger risk than the purchase/sale of the precious metals.

The National Bank put pressure on our banking relationship and in one case, created a huge loss for us with Andelsbanken, one of the banks we used. None of these facts was ever reported in the Danish media.

Advocate Folmer Reindel told the European Court of Human Rights in Strasbourg – 26th September 1988:

“It is clear that the Danish authorities had, for a long time, the objective to close down Hauschildt’s successful and profitable business, irrespective that the companies acted correctly and within the Danish law. From the first day of the action against Hauschildt and his companies, it has been the objective of the Danish authorities to justify their illegal acts at any cost, including keeping Hauschildt in solitary confinement and pre-trial detention for more than four years as a hostage to justice. The Danish authorities acted with total contempt for the Danish law and justice and the European Human Rights Convention. Hauschildt and his companies became victims of the Danish State”

We were subjected to wiretapping (recording of telephone conversations) by the Danish authorities long before my arrest in January. Bagmandspolitiet knew from this wiretapping that all of our Deferred Delivery Contracts in silver and platinum had a minimum of a three-month possible delivery clause; a strong legal agreement with our clients who had agreed to enter into when buying on margin. This, together with the fact that I was absolutely certain that the precious metal price would crash due to the action by the Commodity Exchanges in New York and Chicago, must have aggravated the Danish authorities whilst listening to my telephone conversation. The Special Prosecution also knew that the company would be calling some of the clients to make “margin calls” amounting to close to ten million Kroner.

The Danish public and many clients of Scandinavian Capital Exchange was fooled and lied to by Bagmandspolitiet and the Danish media. Fooled by the misinformation, malicious lies and innuendoes put out by the prosecution in the press.

Bagmandspolitiet took maximum advantage of spreading allegations according to some clients’ who were so disgusted with the prosecution’s method; unfortunately, these clients’ voices hardly showed up in the media.

The Companies Created Considerable Press Coverage Through the Years

During the period 1974-1980, The Companies collected many headlines and press coverage mostly in the financial media. SCE’s mission was to educate the Scandinavian investor since they had been isolated from the international world of finance.

SCE pioneered many forms of investments including investing in precious metals (gold, platinum, palladium, rhodium and silver). SCE regular “Markedsreport” was often quoted by the financial press and the subject of many articles in the press.

Therefore, the company instigated a considerable amount of info-media coverage, held regular seminars and published material aimed to educate the investor. This activity was a central part of the companies operation and really a pre-requisite to developing a proper clientele and market activity (See: SCE Presse omtale 1976-1979).

Scandinavian investors had little choice as to investing; the governments wanted them to buy financial instruments created by the banks, so they could “control” all data and information. Investors were directly encouraged to invest in bonds which did not even give them a return but paid out a little wining via a lottery. Very cheap money for the governments at the time. In Denmark, the so-called mortgage bonds also were encouraged since the coupon was easy to tax. The currency restriction did not allow investors to buy foreign currency. This left investors totally unprotected against possible devaluations and other upheavals from outside. The only way to protect against such risk was to buy real assets such as precious metals.

SCE first and foremost encourage investors to buy some precious metal and “keep it close” e.g. in their home or if they had a bank box, this as insurance against a “rainy day” more or less like you pay an insurance premium against the future. When investors did this they most of the time paid with cash and received their precious metal bars or coins over the counter, not providing their names and address. It was not required at the time for the companies to register such purchases apart from charging purchase tax.

Untrustworthy Judgement

In an editorial leader of the newspaper INFORMATION Editorial-Leader on 3rd November 1982, the editor attacks the judgement and put a big question mark to its legitimacy and worthiness.

“Judge Claus Larsen appears, according to the judgement that he has formulated on his and the two lay-judges (housewives) behalf, to not have attended the trial when the defence augmented and during the summing-up of the case. There are no records for the defence arguments for summing up in the Judgement. Without commenting about the prosecution we can establish that the two defence attorneys review of the whole case and the legal content was of the highest intellectual plan and convincingly questioned Bagmandspolitiet charges.

Claus Larsen routinely lashed out with his three year routine of using the automatic approval for the prosecutions wishes and chose in the judgment just to copy the prosecutions (Bagmandspolitiet) indictment word for word with a change of a comma, just to show his independent work.” “Fraud (as Hauschildt was judged for), presumes that the defrauded has been misled by the accused. The prosecution claimed that Hauschildt had defrauded the clients by not securing and hedging the precious metal.

The defence proved that the clients had not received such promise in the standard business terms.” (Information newspaper confirms the same views and facts. as the respected law professors in Sweden, that the companies business terms did not require the companies to hedge.

“The court still insisted that clients had been misled, despite the proof in the business terms. The court should at least have included the clients, who had told the court that they had not been misled, in the judgment. But Claus Larsen, who must have a right arm as a village blacksmith from the use of his hammer, swings his rubberstamp and judge Hauschildt wholesale.”

Further, in this editorial leader in Information, it states: “It is not unknown that the courts are influenced by the media and the atmosphere that the press can blow up and manipulate information. The prosecution has, in the most profound way, argued their case in the tabloid media for the last three years. It is not difficult to understand that a judge, who has for nearly three years and month after month took the responsibility of keeping a person incarcerated, may have the mental strength and personality to go above his many possible faulty decisions throughout the years.

It is only human for the judge to justify his many previous decisions as to the incarceration.” The editorial leader goes on to criticise many aspects of the untrustworthy judgment. The objectivity of reporting by Information newspaper can be seen from there articles covering the end of the trial at the City Court (see: 08.09.80-Anholdt på tv-skærmen_ Information, Vidnerne som var gennem bagmandspolitiets maskine, – Information 15th September 1982, – Information 23rd September 1982, – Information 24th September 1982 – Editorial-Leader)  

The Trial by the Press

No other major newspaper showed the objectivity of Information newspaper – sadly they wanted to sell headlines stories and sensations – all provided with the compliment of the special prosecutor. The free press has a responsibility. The free media should be a guarantor for the citizen for exposing obvious injustices and wrongdoings by government and their civil servants.

“Hauschildt you have been selected – and judged. You were selected because you are a “foreign Dane” with no political affiliation or power, you work in a business which daily deals with Swiss banks, New York and London – movement of money and in a financial market most people in Denmark do not know and can’t participate in, you controlled your business without a large management and do not employ many people, not like a factory owner.” – Advocate Jørgen Jacobsen July 1980 – nearly 4 years before the end of my pre-trial detention and 8 months before being charged!

The Danish media failed miserably in their responsibility in my case. Instead of seeing through the authorities’ true intentions, they went along as a lap dog and swallowed all the lies and misinformation that Bagmandspolitiet created to justify their actions.

Moreover, the tabloid press livens up all the “stories” from false gold bars to black-market trading and even murder; all totally untrue. These lies appeared in the newspapers at a time when I was in solitary confinement and was without any possibility of unable to speak out. I submitted more than one thousand one hundred newspaper articles to the European Court of Human Rights.

HAUSCHILDT SHOUT OUT – A MISCARRIAGE OF JUSTICE

The popular tabloid press just ridiculed everything as they acted as henchmen for the authorities. The above headline as to miscarriage of justice appeared more than four years before the end of my pre-trial detention.

Recently the highly respected journalist and Pulitzer Prize winner Carl Bernstein (Watergate), spoke out about the tabloid press and said that the tabloid press works at the sewer level and pollutes by bringing everything into the gutter.

The tabloid intrusion has no accountability and is corrupt and criminal, totally without morale. I agree with his assessment wholeheartedly. Bagmandspolitiet showed my letters and notes, which I made during my solitary confinement, to the Danish tabloid.

These notes and letters were made in deep despair and distress when I suffered from the torture of solitary confinement and after witnessing that everything I had worked for being ruined and stolen as well as seeing my sons, wife and mother going through hell.

It is not unknown that the courts are influenced by the media and the atmosphere where the press can blow up and manipulate information, the prosecution has in the most profound way argued their case in the tabloid media for the last three years” – Information Newspaper

Nevertheless, these notes became regular fodder for the gutter press which ridiculed me and even worse, criminalised me. I could do nothing from my isolation cell. There seems to be a bias in most news reporting, it is daily that we see reporters lie by inference and omission without any accountability.

I have seen well-intentioned news publications in the United Kingdom and the US fly into a state of high dudgeon and defend their reporter’s dubious behaviour on the premises of newsroom morale and press independence. All media publishers do have power without responsibility – not only in Denmark.

The Danish media failed in its responsibility in my case; journalists made no objective inquiry to determine the real background of the events which took place on the 31st January 1980 moreover the damages which had been caused that first day with the closing of the companies. Later a few serious journalists became aware of what was taking places, such as Leif Blædel and Rolf Bagger, but by then it was too late and the damage was done. This was something that the media in Russia or DDR could do nothing about, whereas in Denmark it had such possibility, but moreover the obligation to do something about it.

“Of all the ills there are, Rumour is the swiftest”. She thrives on moments and gathers strength as she goes. From small and timorous beginnings she soon lifts herself up into the air, her feet still on the ground and her head hidden in the clouds. Rumour is quick of foot and swift on the wing, a huge and horrible monster, and under every feather of her body, strange to tell, there lies an eye that never sleeps, a mouth and a tongue that are never silent and an ear always pricked. By night she flies between earth and sky, squawking through the darkness, and never lowers her eyelids in deep sleep. By day she keeps watch perched on the tops of gables or on high towers and causes fear in great cities, holding fast to her lies and distortions as often as she tells the truth.”

The ancient Roman poet Virgil wrote this in his Aeneid.

Rumour was not there but rumours were created and were something the Danish authorities took great advantage of when they invited the Danish Television to film the storming of the companies’ offices and rumours were created every hour on the Danish radio news telling the Danish public about the event and my arrest. Denmark had at the time only one television station Danmarks Radio and Television, which with their 19.30 news (TV-Avisen) had everyone in Denmark clued in front of their television.

Since this was the biggest story that night showing the television people at our banking offices at Højbro Plads together with members of the Special Prosecution, Copenhagen fiscal authorities and other journalists – the program sealed the fate of the companies, our clients and staff and me. In reality, the Special Prosecution and the authorities had no way back. The point had been reached, as Franz Kafka said, from which there was no return. The outcome was obvious the clients of the companies became anxious and desperate with many of them being told by Bagmandspolitiet “it is all fraud”. Just imagine a bank which has been closed with the TV cameras rolling, how do the depositors feel?

 “The Danish National Bank, the Ministry of Trade, the Company Register and Copenhagen tax authorities all conspired against Hauschildt and the companies whilst using the involvement of the Ministry of Justice, the Special Prosecution and court as henchmen”

 

– Advocate Folmer Reindel to the City Court and 8 years later to the European Court of Human Rights’  17 Judges

A few days later the Danish Television featured a special program for 40 minutes at prime time (20:00) and repeated five days later. Such a television program had devastating effects on how the public and indeed the company’s many clients perceived what had happened to the companies and me. Rumours and insinuations, later followed by lies, innuendoes and fictitious stories in the tabloid press, all properly became the most important weapon for Bagmandspolitiet and the Danish authorities in covering up the injustices against my companies, our clients, our staff, my family and me. Confidence and trust is everything when you deal with people’s money.

The moment the seed of doubt has been planted out goes confidence and trust – then fear enters. The Danish authorities wanted maximum impact and created fear among the companies’ customers so they could believe something was wrong with the companies and all shout that we had been defrauded.

Yes, all were defrauded, but neither by me nor the companies but by the Danish authorities using their henchmen: Bagmandspolitiet, the courts and the unscrupulous tabloid press. In the City Court, Bagmandspolitiet argued for a 12 years sentence, but in the High Court, they argued for a 10 years sentence? At least some of the judges in the High Court had some decency and independence when they gave me a sentence of 5 years – they had to just to justify my pre-trial incarceration, but they could have given me 8 years, as I, in reality, had served an 8 years sentence.

The famous Danish TV host, author and priest Jørgen Thorgaard wrote in BT referring to my case (which was finished at the time):

“It is my impression that the police, the courts and the prosecution in the best scenario has been acting very incompetently and in the worst scenario, created a miscarriage of justice”.

Thorgaard only echoed what my defence lawyer Folmer Reindel had told Berlingske Tidende

The Storming of the Companies on the 31st of January 1980

What happened when Bagmandspolitiet stormed my companies’ offices on open television and carried out boxes of precious metal and gold coins, paintings and various art objects together with boxes of documents?

Despite that the Danish press cannot be blamed for objectivity, the articles on the 1st February 1980 (the next day) did show good journalism, but more importantly the real intention of the Danish authorities at the time since all the statements to the media came from the Special Prosecution’s (Bagmandspolitiet) office.

Since the media coverage played a central part in everything in which the authorities had planned, I will deal with each main newspaper article that was published in the days after my arrest and the closing of the companies.

At the time of writing, I do not have all the articles in hand, but as I receive them, I will go through each article later on and add my comments.

Børsen, Friday the 1st February 1980 (see the article in Danish: 1st February 1980 Bagmandspolitiet lukker SCE)  The biggest Danish Financial Newspaper at the time.

The Special Prosecution closes Scandinavian Capital Exchange

Making charges for serious tax evasion against Denmark’s largest bullion dealer Back page Heading: Precious metal dealer accused of tax evasion

Police close Scandinavian Capital Exchange

Scandinavian Capital Exchange has been closed by Bagmandspolitiet.

The commodity trading company, with offices at Højbro Plads, is the largest bullion dealer in Denmark and has been subject to observation through the recent months. Yesterday Bagmandspolitiet, with a court order, granted permission to search through the business and offices and at the employee’s private addresses. At the same time, a person has been arrested, who today will be presented to the Copenhagen City Court. The police will not confirm if it is the owner and director of the company Mogens Hauschildt or another person.

“We have taken this stand from Bagmandspolitiet (the Special Prosecution for Economic Crimes) that we do not wish to mention names since we do not know if the court wants to protect the name of the person”, says criminal commissioner Mogens Kanding, who is department chief in Bagmandspolitiet.

“Through channels which we control we have found out that possible serious tax evasion has taken place, according to the criminal code paragraph 289 tells Mogens Kanding Børsen.”

Some seized material has been taken by Bagmandspolitiet; in the meantime, we continue to investigate in the company’s offices.

“We will go through all the material and especially concentrate on the companies order confirmations/dealings with its clients since we wish to double control on these client’s tax returns. At the same time we want to concentrate to see if there has been any wrongdoing by the company, as an example if we suspect any fraud against the clients, we will contact these clients and ask for their version.”

“Bagmandspolitiet’s action against Scandinavian Capital Exchange comes as a culmination of the greatest “gold rush” in Denmark.

When Scandinavian Capital Exchange started its business in the spring of 1974, investing in precious metal was practically unknown (in Denmark).

Today we will conservatively estimate that at least 10,000 Danes have, in procession, a larger or smaller amount of investment silver, Kruger Rand and platinum bars. It is still unknown if Scandinavian Capital Exchange will be opened again today…  Therefore nothing can be said about the situation as to the many clients that have used the company’s so-called “deferred purchase agreement”. A form of margin speculation.”

In reading the whole article, the reader must get the impression that the Special Prosecution was on a “fishing expedition” and that serious tax evasion must have been committed and that the fiscal authorities wanted to see investors’ tax returns and that the only way to do it was by closing the companies and later making out that I was responsible for the investors losses.

Note the fact that Kanding tells the newspaper that Bagmandspolitiet would contact the companies’ clients and ask for their version – of what? This being done after the closing of the companies giving some of these client losses – what should client say?

Jyllands-Posten, Friday the 1st February 1980 (see the article in Danish: 1st February 1980 )

The Special Prosecution closes Scandinavian Capital Exchange

Making charges for serious tax evasion against Denmark’s largest bullion dealer Back page Heading:

Precious metal dealer accused of tax evasion

Police close Scandinavian Capital Exchange

Scandinavian Capital Exchange has been closed by Bagmandspolitiet.

The commodity trading company, with offices at Højbro Plads, is the largest bullion dealer in Denmark and has been subject to observation through the recent months. Yesterday Bagmandspolitiet, with a court order, granted permission to search through the business and offices and at the employee’s private addresses. At the same time a person has been arrested, who today will be presented to the Copenhagen City Court. The police will not confirm if it is the owner and director of the company Mogens Hauschildt or another person. “We have taken this stand from Bagmandspolitiet (the Special Prosecution for Economic Crimes) that we do not wish to mention names, since we do not know if the court wants to protect the name of the person”, says criminal commissioner Mogens Kanding, who is department chief in Bagmandspolitiet.

“Through channels which we control we have found out that possible serious tax evasion has taken place, according to the criminal code paragraph 289 tells Mogens Kanding Børsen.”

Some seized material has been taken by Bagmandspolitiet; in the meantime we continue to investigate in the company’s offices.

“We will go through all the material and specially concentrate on the companies order confirmations/dealings with its clients since we wish to double control on these client’s tax returns. At the same time we want to concentrate to see if there has been any wrongdoing by the company, as an example if we suspect any fraud against the clients, we will contact these clients and ask for their version.”

“Bagmandspolitiets action against Scandinavian Capital Exchange comes as a culmination of the greatest “gold rush” in Denmark.

When Scandinavian Capital Exchange started their business in the spring of 1974, investing in precious metal was practically unknown (in Denmark).

Today we will conservatively estimate that at least 10,000 Danes have, in procession, a larger or smaller amount of investment silver, Kruger Rand and platinum bars. It is still unknown if Scandinavian Capital Exchange will be opened again today…Therefore nothing can be said about the situation as to the many clients that have used the company’s so called “deferred purchase agreement”. A form of margin speculation..”.

In reading the whole article, the reader must get the impression that the Special Prosecution was on a “fishing expedition” and that serious tax evasion must have been committed and that the fiscal authorities wanted to see investors’ tax returns and that the only way to do it was by closing the companies and later making out that I was responsible for the investors losses.

Note the fact that Kanding tells the newspaper that Bagmandspolitiet would contact the companies’ clients and ask for their version – of what? This being done after the closing of the companies giving some of these client losses – what should client say?

Jyllands-Posten, Friday the 1st February 1980 (see the article in Danish:1st February 1980 )

Heading front page: Danish company accused of fraud with precious metal

One of Denmark’s leading bullion dealers, director Mogens Hauschildt of Scandinavian Capital Exchange, was yesterday arrested and accused of tax evasion.’

He will today be present in court… Criminal commissioner Mogens Kanding Bagmandspolitiet tells Jyllands-Posten:

“We have been investigating the company since it started (1974) just to see what is happening. Approximately three weeks ago our investigation became more intensive on our own initiative. We have not received any complaints“

Tax evasion: Jyllands-Posten: Is there only a question of tax evasion? Yes, at this time Jyllands-Posten: How big amount is in question? This we can’t inform you about.

Mogens Hauschildt was the pioneer of investing in precious metals. Scandinavian Capital Exchange started in 1975. The company is owned by Capital Associates AG in Zurich and Hauschildt owns all the shares in the mother company. It is not legal to sell gold bars in Denmark…

The turnover is large and in busy periods easily several hundred million Kroner can be earned in a few weeks. The profits are very large.  …

More than ten thousand Danes have invested in gold, silver and platinum; it is considered an attractive investment with “black” money. It is also the possibility of getting a tax free profit when the price goes up (out of reach from the fiscal authorities). Scandinavian Capital Exchange also sells terminal contracts on margin and this has not suited the National bank. Concerned According to Ritzaus Bureau, lawyers in the National Bank foreign exchange department have been concerned about this terminal trading; there has been a character of passive capital investment abroad…

Reading this article gives a new dimension to Børsen’s article above.

First, there has been a fraud with precious metals?

Secondly, Jyllands-Posten has been given my name.

Thirdly, Bagmandspolitiet has been investigating the companies for more than five years just to see what?

Just like Stasi or KGB. As Stalin said, “Show me a person and I will always find a reason against him” (to kill him or send him to the Gulag). In the companies, we knew that the Danish the authorities had been harassing us constantly for years, but we did not know that Bagmandspolitiet was involved,  see: Five Years of Continuous Harassments Before the Event.

No complaint had been made to the police and the Special Prosecution (Bagmandspolitiet). The Special Prosecution decided themselves to take the action.

Further, that black money was invested in precious metals and the profits were tax free outside the reach of the fiscal authorities. This could NOT BE TOLERATED, despite that the current law allowed this at the time.

Politiken, Friday the 1st February 1980 (see the article in Danish: 1st February 1980 Politiken )

Front-page heading: Gold dealer arrested for millions – fraud

“Yesterday Bagmandspolitiet attacked one of Denmark’s largest dealers of gold, silver and other precious metals, Scandinavian Capital Exchange, in Copenhagen. The police seized a large amount of account material and arrested the company’s director. He has been accused of tax evasion of a serious kind according to the criminal code paragraph 289, which has maximum imprisonment of four years.

After what Politiken has found out, it is a question of tax evasion amounting to millions

The arrest yesterday has nothing to do with the National Bank’s complaints according to Prosecutor Finn Meilby (head of Bagmandspolitiet). Bagmandspolitiet have, for various reasons, felt inclined to investigate Scandinavian Capital Exchange business closely and compare information from tax authorities and the customs and excise office and have, through this, found a reason to charge for tax evasion… We found material there to confirm our existing knowledge about the company. We have investigated the case for about a month and the reason is that huge speculation in precious metals brought our attention to this and other companies have told criminal commissioner Mogens Kanding… I will not say that we closed the business with our action, but the company cannot pay out money nor receive money”

Reading this article one gets another story: According to the chief of the Special Prosecution (Bagmandspolitiet) Finn Meilby, Bagmandspolitiet have, for various reasons, felt inclined to investigate Scandinavian Capital Exchange business closely and compare information from tax authorities and the customs and excise office and have, through this, found reason to charge for tax evasion.

I was never charged with tax evasion since this was a trumped-up charge and there truly was no tax evasion by me or the companies. Interestingly, Mogens Kanding told this newspaper (Politiken) that Bagmandspolitiet has only been investigating the company for a month, not five to six years as he told Jyllands-Posten.

BT, Friday the 1st February 1980  (see the article in Danish: 1st February 1980 ) At the time the biggest tabloid.

Headlines:

The police left with gold and silver worth millions.  A Danish company’s (SCE) large million profits on speculation on gold and other precious metals have escaped taxation.

After telling the readers about the razzia and seizure of valuables together with documentation. A reference is made to a statement from Finn Meilby as to a large amount of money: “It is our impression that the money has been taken out of the country”. The article goes on to mention that I have also been charged with exchange control violation.

The reader is also told that Finn Meilby attended an international police congress in Paris a month earlier, where Interpol warned against the rising crime in precious metals and commodities. This resulted in that Bagmandspolitiet started to examine the Danish market. With the help of the customs and excise office, the tax authorities and an auditing firm, they started to go through SCE’s accounts.

Finn Meilby states further on in the article:

“That the arrest of Mogens Hauschildt only concerns the alleged tax evasions” In reading this article, a reference to Finn Meilby attending a conference in Paris is made for the first time, also that Bagmandspolitiet had employed an outside auditing firm.

The fact is that Bagmandspolitiet closed a company, seized all the valuables and assets for open television for all to see because they had “an impression that money had been taken out of the country” – only an impression? I was never charged with such an offence.

During the period 1974-1980, SCE collected many headlines and press coverage mostly in the financial media. (see SCE Presse omtale 1976-1979)

SCE’s mission was to educate the Scandinavian investor since they had been isolated from the international world of finance. SCE pioneered many forms of investments including investing in precious metals (gold, platinum, palladium, rhodium and silver).

Therefore, the company instigated a lot of info-media coverage, held regular seminars and published material aimed to educate the investor. This activity was a central part of the companies operation and really a pre-requisite to developing a proper clientele and market activity.

Politiken, Saturday the 2nd February 1980 (see the article in Danish: POLITIKEN 2nd February 1980)

Front-page headlines:

Gold dealer ready to escape – Bagmandspolitiet counted on the fact that the top director from the bullion dealers, Scandinavian Capital Exchange, was attempting to escape abroad just when he was arrested on Thursday.

The director is accused by Bagmandspolitiet of serious tax evasion, and together with his co-director, was also yesterday accused of fraud in connection with the sale of silver, gold and platinum.

The clients who are supposed to be defrauded have only had a receipt for the precious metal, which should be in the company’s vault. Only a very small amount of the precious metal should exist In carrying out the search warrant on Thursday in the companies’ offices on Højbro Plads, the police only found a few million in cash in the bank and some precious metals, despite the company having had a turnover of approximately 500 million Kroner in silver, gold and other precious metal. The majority of the company’s clients should expect to have a big economic hit, tells criminal commissioner Mogens Kanding from Bagmandspolitiet.

The criminal commissioner informed further that the top director had just made plans to leave Denmark” On page six the article continues: Gold treasurer to foreign country Criminal Commissioner Mogens Kanding from Bagmandspolitiet, informed Politiken yesterday:

 “That a major part of the profit from the Danish company, which had a turnover of half a billion Kroner (500 million) apparently has been transferred to post-box companies in Switzerland. After the carrying out of the search, we have been able to confirm that large amounts have been sent to companies in Switzerland and there is often only a lawyer’s office there where the money is then hidden from the police”

After the police, tax authorities and the customs and excise office’s investigation, it does look like the company in Denmark have earned large amounts on the Swiss addresses. The money should have been obtained by fraud with bearer deposit receipts of precious metals. In reading this article two days after the event, a Saturday (so all the investors and clients had the whole weekend of anxiety and worry), one can only believe that I had planned on escaping abroad and that the company had a turnover of 500 million Kroner and no money had really been found, also that the Swiss companies had issued fraudulent bearer deposit receipts.

None of it was the truth

In January 1980, I had been in Switzerland three times: once with my family (New Year) and later twice with my wife; in fact, I returned from a weekend in Switzerland two days before my arrest. I had been in Germany and twice had been in Holland working in my company’s offices in Rotterdam, (International Resources). Not to mention twice at my companies offices in Sweden and a planned office in Stockholm. In other words, if I planned to leave Denmark, I had ample opportunity.

As of running away or just escaping  – all of this was a direct lie in order to get the public, and later the judges, to believe that I was running away from Denmark because I had done something wrong.

No “bearer” deposit receipt for precious metals has never been issued by the Swiss companies and the companies were never subjected to any charges by the prosecution in Denmark or anywhere else.

No doubt that the company could have had a turnover of half a billion or billions if the Danish authorities had not closed the company, however, 500 million Kroner was just a lie since the tax authorities received a reporting on our turnover every month – they should know that it was 50 million Kroner, not 500 million.

What is interesting are the various reasons for my arrest given by different people from the Bagmandspolitiet (the Special Prosecutors office).

Finn Meilby’s version: To set out a totally controlled case (ideal material), which Bagmandspolitiet could control from the first moment just like a stage set at the Royal Theatre, closing the companies on open television and making my arrest, and later feeding the media with stories, painting a criminal profile of me and the activities of the companies, knowing very well that this would always stay in the public mind; thereby controlling the public mind and everything via the Ministry, the courts and judges.

Mogens Kanding’s version: That the Danish authorities, having investigated the companies for more than five years, using the Special Prosecution as henchmen just wanted my companies closed at all costs. When their agent provocateurs did not work and the tax authorities could not find anything wrong and worse than no client from the companies would make any complaints – Bagmandspolitiet just had to make their case for open TV to create maximum exposure, fear and anxiety among the companies clients – all the rest would follow. They knew that you can’t get it back out of the public mind.

Aktuelt, Saturday 2nd February 1980 (see the article in Danish: Aktuelt – 2 February 1980 ) A socialist newspaper, supported by the socialistic government.

Headlines:

The greatest fraud case to date in Denmark Milliard (billion) fraud with silver which does not exist charges of fraud up to a billion Kroner awaits the director Mogens Hauschildt of Scandinavian Capital Exchange.

With such headlines, the readers could not be left in doubt. The newspaper was indirectly owned by the ruling Social Democratic Party and Danish trade unions that sensationalised the arrest and the court hearing, including the closing of the companies. It also informs the reader that half of a hundred concerned investors had contacted Bagmandspolitiet (Special Prosecution), after seeing the closing of the companies and my arrest on television.

After such headlines and television programs, the Special Prosecution had no way back; to make matters worse, the image of me and my companies were ruined and this could never be taken back from the public mind.

According to our (Aktuelt) information, it is most likely that the charges of serious tax evasion will be dropped (they should know the newspaper being owned by the Socialist). In other words, the charges of alleged tax evasion were just used to get a warrant issued, one day after my arrest and the closing of the companies they knew there was no tax evasion.

The newspaper coverage of the event on Friday, Saturday and Sunday were huge and most pre-judicial. Denmark is a small place and such great amount of press coverage both in the national and local press did considerable and irrevocable harm to the case.

Bagmandspolitiet had unscrupulously used the most important weapon to smear, discredit and disgrace my person – the media. Thereafter, there was no way back moreover, the public would never “take back” what they had witnessed on the television and newspapers.

Although the national newspaper’s headlines, followed by the many local newspapers, made an impact on the nation the first few days after my arrest and the closing of the companies, by far the most pre-judicial and crucial coverage for the whole case, came from the Danish state-owned television.

Denmark had, at the time, only one TV station which was owned by the state, Danmarks Radio & TV. The Special Prosecution had informed the television station the day before I was to be arrested so that a camera team could film the storming and closing of the companies. Journalists from the television station tried hard to contact me in order that I could also be arrested on the open screen (see later under “Trial by the media”). At the time, most Danes’ would be glued to the front of their television for the regular evening news at 19.30 (TV-Avisen).

On the evening of the 31st of January 1980, the whole of Denmark saw that Bagmandspolitiet closed Scandinavian Capital Exchange and they heard that two directors had been arrested. The television viewers could watch Bagmandspolitiet carrying out boxes of documents, valued paintings and antiques from the offices of the companies. In other words, Bagmandspolitiet acted as the instigators, prosecutor and judge; the case was concluded the first day – GUILTY.

 “The Danish National Bank, the Ministry of Trade, the Company Register and Copenhagen tax authorities all conspired against Hauschildt and the companies whilst using the involvement of the Ministry of Justice, the Special Prosecution and court as henchmen”-

Advocate Folmer Reindel to the City Court and 8 years later to the full Court of 17 judges at the European Court of Human Rights in Strasbourg.

 

I had previously worked with the two journalists from Danmarks Radio, who made the filming of the event. Both journalists had an established reputation and we’re known as “good” Social Democrats. Apart from working for the Danish state television, they worked for Aktuelt newspaper, also associated with the ruling Social Democratic Party. Both became editors in charge of the newspaper some years later.

Within a week of my arrest and the closing of SCE, these two journalists presented the final nail in my coffin by showing a forty-minute (at prime time, 20.00), television programme where they involved some SCE clients who had become very anxious and worried after seeing the companies being closed by Bagmandspolitiet.

This very subjective television programme, which was repeated a few days later, did indeed seal mine and my companies’ future.

I do not blame the journalists; after all, they received a good story on a silver platter and did their job. Nevertheless, they were part of a conspiracy against me and the companies.

Their forty-minute programme also fanned the flames of anxiety for the companies’ clients and somewhat also encouraged them to come forward and claim that they had been “defrauded” since they expected a better position when claiming this. Neither I nor any senior employees from the companies were able to comment on all the various allegations raised in the television programme.

Interestingly, more than eight years later on the 26th September 1988, the European Court of Human Rights held an open court hearing on my case in front of the full court of 17 judges. The German, French, Belgian and Dutch television stations were there, but not the Danish State Television, which had been used by the Danish authorities to create a trial by the media.

Folmer Reindel had many times said to the Danish media, “That he feared a justitsmord – a miscarriage of justice” from the start of the trial in the lower court. When Folmer Reindel stood in the European Court of Human Rights eight years later facing 17 judges from the 17 member countries, he said to the court:

“I said at the beginning of the trial at the Copenhagen City Court that Mogens Hauschildt would not be given a fair trial and that the Danish state had already created a miscarriage of justice, just to cover up the closing of his successful companies” than turning right facing Isa Foighel, (representing Denmark) Folmer Reindel said: “Denmark could already than have saved itself from being here today in this eminent forum of justice”