By Ben Butler Business reporter From The Sydney Morning Herald

Tax avoidance and money laundering charges against former CVC Limited chairman Vanda Gould, former Sunland chairman John Leaver and Swiss resident Peter Borgas have been dropped.

The trio were arrested by Federal Police in October on allegations they used a complex network of companies in tax havens to avoid millions in Australian tax.

They were each charged with conspiracy to defraud the Commonwealth and conspiracy to deal with property intending that it be used as an instrument of crime.

The charges, which carried jail terms of up to 25 years, were withdrawn by the Commonwealth Director in Sydney Local Court on Tuesday morning.

Related civil cases in which a network of offshore companies associated with the trio are challenging Tax Office bills of about $40 million are before the Federal Court.

Following the arrests, barrister John Hyde Page, who represented the companies, slammed the ATO’s Operation Wickenby unit as a ”Gestapo unit” that should be shut down.

He also attacked ATO deputy commissioner Greg Williams for describing the arrests as ”a warning to people who abuse tax secrecy havens”.

”The fact that Greg Williams is prepared to make those sort of comments about three men who have not yet been convicted of any crime indicates the kind of fanaticism that is at work in the ATO,” Mr Hyde Page said. ”The Wickenby era is disgusting.”

He later apologised to the Federal Court for his remarks.

The case also caused ructions in the relationship between Australia and the Cayman Islands when formerly secret company documents showing Mr Gould controlled two Caymanian companies were tendered as evidence despite a court in the Caribbean tax haven ruling they could not be used.

In a statement, Mr Gould’s solicitor, Justeen Dormer, said the charges had caused ”months of disruption to Mr Gould’s life”.

”I am pleased that the charges against Mr Gould have been dropped and he can now return to the work and philanthropic pursuits to which he has dedicated his life,” she said.

At the time he was arrested, Mr Gould was chairman of investment company CVC, which is unrelated to US public equity group CVC Capital Partners.

In addition, he was chairman of CVC spin-off CVC Property Fund and biotechs Cyclopharm and Vita Life Sciences.

He stepped down from his chairman positions but remains a director of all four companies.

Mr Leaver is also a director of CVC.

IMAGE: CVC Investment Managers chairman Vanda Gould. Photo: PAUL JONES

For more on this story go to: http://www.smh.com.au/business/charges-over-cayman-islands-tax-haven-dropped-20140513-386qo.html#ixzz31YgZCY42