With New Labour at pains to prove its commitment to Europe on issues such as tax, the Government is pressing its offshore crown dependencies to clean up their act. The unlucky Mr Crowshaw has simply become a pawn in the latest trade-offs between the British government and its European partners.
In January, the Labour media machine trumpeted to the press an earlier decision by the High Court in Manchester against Mr Crowshaw as a "fatal blow against the practice of so-called nominee directorships - a lucrative device used by certain residents of the Channel Island of Sark to provide fronts for dubious British companies".
Like the British government, the powers that be in Guernsey appear serious in their attempts to silence their critics. The pounds 100bn-plus financial services industry, which considers itself 100 per cent legitimate, has long referred to Sark's goings-on as the pimpernel on its behind. At the beginning of the year, the Financial Services Commission in Guernsey hired former UK criminal barrister Talmai Morgan, an expert on trusts and a self-confessed "poacher turned gamekeeper", to bring Guernsey's pounds 50bn trust and company management business to heel.
Commenting on the Crowshaw case, Mr Morgan said: "The story is simple. Mr Crowshaw is a resident of Sark. We believe him to be, or at least to have been, a director of between three and four thousand companies. That is completely unacceptable in the eyes of the commission."
Guernsey denies British government pressure is behind its offensive, but the voluminous report into Britain's offshore dependencies commissioned by Jack Straw, the Home Secretary, must have galvanised it.
Andrew Edwards, the author of the report, who is a former UK Treasury director, expressed concern over Sark residents "holding themselves out as company directors, while passing all directors' duties to the owners of the company, thus taking no responsibility". Kim Howells, the minister for Competition and Consumer Affairs, recently described the practice as a scandal.
In the 1980s, the Channel Islands became famous for the "Sark Lark" in which companies bought Sark addresses without any physical presence on the island. This is now outlawed but islanders can still offer themselves as directors, conferring both secrecy and tax benefits on overseas companies.
Of Sark's 600 or so residents, it is thought that most of the adult population are involved in some way in the business of directorship, which provides maybe 10 to 15 per cent of the island's income. One Sark director says the number has now fallen to fewer than 100 in the wake of the Manchester ruling.
Mr Morgan's first action on arriving at the Financial Services Commission in January was to borrow files from the UK proceedings against Mr Crowshaw and file for his disqualification.
It is clear that Mr Crowshaw's Sark-based business of renting his name to pretty much any company in need of a director had flourished for several years before hitting problems. By January this year, he had racked up 3,378 companies paying between pounds 50 and pounds 400 for using his name. It was only when some of the companies for which he was legally responsible turned sour that his name became heard in the courts.
Mr Crowshaw did not put forward a defence in either trial, except to negotiate his way out of paying the commission's costs in the Guernsey proceedings.
In January he was disqualified from acting as a director of any UK company after Oldham Vehicle Contracts, a car hire firm, was compulsorily wound up by the Official Receiver with debts of pounds 570,000.
At that time, Mr Crowshaw held directorships or other positions in 1,312 other UK companies. Even before the court case, he had been director of 16 companies that had gone into some form of liquidation.
The court in Manchester also brought Mr Crowshaw to book for five offences under the Unsolicited Goods and Services Act in connection with his directorship of another company, Invincible Industrial Chemicals. He was convicted even though he had no knowledge of the company's actions.
St John Robilliard, Mr Crowshaw's Guernsey-based lawyer, could not confirm how many directorships his client had outside Guernsey. But in the light of evidence brought before the High Court in Manchester it is believed Mr Crowshaw may remain a director of more than 2,000 companies registered in Dublin and the Isle of Man.
Simon Howitt, who argued the prosecution case against Mr Crowshaw in Guernsey without ever setting eyes on him, said: "Whether other jurisdictions will take proceedings against him is not something we can control, but they may well do so once they see what has already happened in two jurisdictions."
The Isle of Man could neither confirm nor deny whether it would apply to the court to disqualify Mr Crowshaw from acting as a company director. Instead an official pointed to a recent case in which John Solly was disqualified from acting as secretary or director of 1,810 Isle of Man companies after a similar court decision in the UK courts.
Andy Walker, the head of enforcement at the Isle of Man Financial Supervision Commission, said: "We are considering our position with regards to legal action against Mr Crowshaw."
When asked about his whereabouts, Mr Crowshaw's lawyer said: "He was not in court. I can confirm that he comes and he goes, he may be [on the island], he may not be. But I am in touch with him."
Mr Robilliard agreed to forward a request to speak with his client. Calls to the Crowshaw home were eventually answered by his wife who said he was out.
Though Mr Crowshaw broke no law in taking on more than 3,000 directorships, he has been condemned by the courts for turning a blind eye to his responsibilities. What worries law-makers about nominee directors is that they make it very difficult to pin responsibility on wayward companies.
Commenting on the Guernsey decision, Mr Morgan said: "We hope the case will highlight a number of matters of public importance regarding the totally unacceptable practice of people renting out their names as company directors without any real knowledge of what the companies are up to.
"Being a director of a company is not in itself a criminal offence, even if you are a director of thousands of companies, but, and this is a very big but, if you are a director of that number of companies, it shows that you are not prepared to properly discharge your responsibilities. And if the job is not done properly, that is when certain offences can be committed."
The commission intends to consider the remaining Sark directors on a case-by-case basis. Mr Morgan says: "There is no such thing as a nominee director, it is a shorthand expression for a practice that is totally and utterly unacceptable and one which we would like to see stamped out irrevocably."
Guernsey's Financial Services Commission is working to bring in a law that will give it much stronger powers to keep what Mr Morgan describes as "undesirable operators" off the islands. By creating a licensing system for company directors, the commission will have the power to screen all those who provide directorships as a business.
"The punch point is that we will have the power to outlaw the Sark Lark," said Mr Morgan. "This will give us express permission to do this and it is an important part of the prospective legislation."
Few on the island seem surprised at the threatened demise of the Sark Lark. Jonathan Brannam, Sark director and chairman of the Sark Association of Corporate Administrators, says: "The Sark Lark is dying and few will mourn its passing."
By the time the new legislation is passed, he believes the number of company directors on Sark will have dwindled to fewer than 30.Reuse content