Although Mr Bacardi's main home is, and has been for many years, Monte Carlo, he has a string of residences round the world. As far as can be determined he maintains the home in Monte Carlo, another in the Bahamas, two in Geneva, one in the south of France, one in Coral Gables, Florida, and one in London in Eaton Place, Belgravia.
Many of these homes are not actually in Mr Bacardi's name, as this might provide evidence to the tax authorities that he was a resident in that country, so enabling them to tax his dividend income.
In one case, the Independent on Sunday has documentary evidence of a scheme hatched 20 years ago by Mr Bacardi and a partner of McKenna & Co to structure the purchase of his home in Eaton Place to avoid his qualifying as a UK resident for tax purposes. The structure means Mr Bacardi has avoided paying tax in the UK over that time. It is hard to say how much he would have paid but it must run into millions.
UK tax law is complex, but is fairly clear on what is called the 'available accommodation' rule. The Inland Revenue defines this rule in layman's terms as: 'Treating individuals in the UK for a temporary purpose . . . as resident for tax purposes in any tax year in which they visit this country - no matter how short the visit - and have accommodation available for their use here.' The rule is in the process of being changed, but it has applied for more than 20 years.
In 1973, Mr Bacardi decided to purchase the home in Eaton Place but did not want to be seen to be purchasing it. The lease was assigned to a company called Savoy Estates, and then passed in 1975 to PBS Corporation, a Panama-registered company with bearer shares held in his lawyer's safe. A letter was written to the Bank of England by McKenna asking it to allow Mr Bacardi to transfer money to Savoy Estates for the purchase, as there were tight exchange control regulations in place then.
On 6 September 1973, Richard Taylor, who was then and still is at McKenna (he is currently a partner on the corporate side), wrote to Mr Bacardi detailing the structure of the scheme to purchase the Eaton Place home via Savoy Estates. In the letter, Mr Taylor states: 'I understand that it is your prime concern that the UK Inland Revenue Authorities should not be aware of the acquisition by you of property in England.' He adds later in the letter: 'You will no doubt be aware that the English Revenue Authorities regard the maintenance of a place of abode in the UK, together with the fact that a visit has been made to such place of abode during the tax year, as constituting residence for tax purposes. If therefore the Revenue do learn of your interest in the property, they will no doubt claim that you are resident and you must therefore decide whether you wish to run this risk.'
It is clear from the letter that Mr Taylor knew that Luis Bacardi wanted to hide the ownership of the Eaton Place property from the UK tax authorities. It makes it clear that while the Bank of England had to be informed of the source of the funds, that communication was to be treated as confidential and would not be passed to the Revenue.
Asked about his role, Mr Taylor said he did recall advising Mr Bacardi but did not recall the advice he had given. He added, however: 'I have never advised any of my clients to do anything improper.'
The papers in our possession have been passed to the Revenue.
The question of Luis Bacardi's nationality and residence is almost as tortuous as his tax affairs.
Like many of the Bacardi family, Luis Bacardi maintains a home at the exclusive Lyford Cay development, near Nassau in the Bahamas. The family moved to the islands en masse after fleeing the Castro regime in Cuba. Luis Bacardi took up permanent residence in the Bahamas in 1962 and obtained Bahamian nationality in 1966, which made him a citizen of the United Kingdom and its colonies. This entitled the Cuban-born resident of the Bahamas to a UK passport.
However, it has emerged that, since 1974, Mr Bacardi has been a resident of Monaco for tax reasons. He has a Monaco resident's card, which is only given to people who are understood to live within the principality for more than six months a year. Yet in July 1981, when applying for a new British passport issued that month, he obtained a certificate of residence saying he was a permanent resident of the Bahamas. The passport was renewed at the British consulate in Madrid in 1990.
A year later he applied for his wife, Danielle, a Swiss national, to obtain residence in the Bahamas. To aid the application, he received a testimonial from the manager of the Royal Bank of Canada's private banking operation in Nassau, saying that Luis del Campo Bacardi was 'already a resident of the Bahamas'. This testimonial echoed one given in 1984 by Orfilio Pelaez, then honorary consul of the Spanish government in Nassau, which said Mr Bacardi had, at that time, been a resident of the Bahamas for 26 years (which would have meant he left Cuba in 1958, four years before he actually did).
However, the UK government appears to be fully aware of Luis Bacardi's ambiguous residency status. The Independent on Sunday has obtained official correspondence sent last year from a British consulate, and based on information provided by the acting British High Commissioner in Nassau, which states that: 'Officially, Mr Bacardi is believed to be a resident of the Bahamas, but in practice spends little time there - no more than 10 days to two weeks a year. His permanent domicile is in Monte Carlo.'
(Photograph omitted)
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