Jacob Rees-Mogg may have breached parliamentary rules by not declaring £6 million in personal loans from his Cayman Islands-linked company, The Mail on Sunday can reveal.
He is the first Cabinet Minister to be dragged into the row over MPs’ outside interests, and led the Government’s botched attempt to soften parliamentary sleaze rules.
The Leader of the Commons borrowed up to £2.94 million a year in ‘director’s loans’ from his UK-based Saliston Ltd between 2018 and 2020.
Parliamentary rules require MPs to be ‘open and frank in drawing attention to any relevant interest’.
The Mail on Sunday can reveal Jacob Rees-Mogg may have breached parliamentary rules by not declaring £6 million in personal loans from his Cayman Islands-linked company. November 8, 2009 in the House of Commons
Although it does not explicitly cover director’s loans, the code of conduct requires directors to declare ‘taxable expenses, allowances and benefits’.
In the MPs’ Register of Interests, Mr Rees-Mogg disclosed himself as an ‘unremunerated director’ and shareholder of the firm, but did not say he had taken out the loans.
By using ‘director’s loans’ – classed by the Government as a taxable benefit – he was able to borrow the large sum at very low interest.
Yesterday night Mr Rees Mogg maintained that because the loans were not earned, he did not have to declare them to Parliament. Furthermore, he said that he had never broken any rules.
He said the 2018 loan was ‘primarily’ used to buy and refurbish his £5.6 million home in Westminster. The rest of the loan was not used for, he said.
But a source in the Commons sleaze watchdog said the loans should ‘absolutely’ have been declared in the Register of Interests, adding: ‘The whole point of registration is the public should be able to know what is governing your decision-making and the actions that you take.’
Thangam Debbonaire, Shadow Leader of the Commons, urged Mr Rees-Mogg to ‘come clean’ about his interests and called on Boris Johnson to launch an immediate investigation into his activities.
Land Registry documents reveal that Rees-Mogg acquired his house (formerly ToryHQHQ) in February 2018. He used a Coutts Bank mortgage.
The £6 million he took in loans includes £2.94 million in 2018, £2.3 million the following year and £701,513 in 2019-2020, Companies House documents reveal.
In the first year he paid no interest, in the second he paid £46,915 and in the final year £2,030 – £48,945 in interest over three years, equivalent to a rate of 0.8 per cent. A typical £30,000, two-year personal loan comes with six per cent interest.
The North East Somerset MP was a director of Saliston Ltd until he joined the Cabinet in July 2019, but retains a 100 per cent shareholding and is a ‘Person of Significant Control’.
He is still married to a director.
Saliston Ltd has previously been described as a ‘holding company’ by Mr Rees-Mogg.
It has £8 million property assets, understood to include a Mayfair house, and nearly £1 million in other investments.
In 2018, it took out a £2.87 million bank loan, according to its accounts, the same year it lent Mr Rees-Mogg £2.9 million.
Somerset Capital Management LLP holds a controlling interest in it, which is the parent company of Somerset Capital Management Ltd (Cayman), in the Cayman islands.
The North East Somerset MP was a director of Saliston Ltd until he joined the Cabinet in July 2019, but retains a 100 per cent shareholding and is a ‘Person of Significant Control’. Photo taken October 27, 2018, after attending the Cabinet meeting in preparation for Rishi’s Budget.
Somerset Capital Management LLP’s accounts show its limited-liability members were remunerated with £3.8 million in 2021. Mr Rees-Mogg said: ‘Saliston is 100 per cent owned by me. This information is made clear in the Commons registry and at the Cabinet Office.
It does not have activities that are in conflict with government policy.
‘The loans from 2018 were primarily taken out for the purchase and refurbishment of [my home]As temporary cash flow solutions
All loans are either paid in dividends or with interest as required by HMRC. Taxes have been applied accordingly.
I have no management responsibility for Somerset Capital Management. However, I know that the Cayman company purely provides a fund for non-UK investors but any and all money it makes returns to Somerset Capital Management in the UK where it pays full UK taxes.’