Report links homeless housing firm to faith room tax avoidance scheme

The Story

A Guardian investigation has reported that a property investor supplying temporary accommodation to local councils is part of a family accused of avoiding tax through bogus prayer sessions. The Schreiber family’s investment vehicle, Midos Group, allegedly exploited a scheme to deprive councils of tax, according to a court claim. A similarly named business, Midos Management Co, provided homeless accommodation to some of the same councils while collecting millions in fees. Lawyers for both entities stated there was no connection, but online records indicate significant personal and professional overlap between their owners and directors. The tax avoidance allegations center on the “faith room” scheme, which the marketing firm Verity said saved landlords at least £18m. A court case by Dover District Council is seeking £1.7m in unpaid tax from Verity and two Schreiber-owned businesses over claimed false prayer sessions at empty units. The council alleges the sessions were staged with no public attendance, while defendants stated the sessions were legitimate.

Key Facts

• The Schreiber family presides over a nationwide commercial property portfolio via the “family-owned” investment vehicle Midos Group.
• Companies connected to Midos Group exploited an elaborate scheme to deprive councils of tax, according to a court claim.
• Midos Management Co tapped some of the same local authorities’ housing budgets by providing accommodation for homeless people.
• Lawyers for Midos Group and a spokesperson for Midos Management Co both claimed there was no connection between the two entities.
• Online ancestry records, archived webpages, and company filings indicate significant personal and professional overlap between their owners and directors.
• The “faith room” scheme has saved landlords at least £18m, according to Verity, the firm that markets it.
• Dover District Council is pursuing a claim for £1.7m of unpaid tax against Verity and two Schreiber family businesses that own the Discovery Park science park.
• The council alleges that 56 empty units at the park were claimed to be available for worship sessions, but sessions involved a pro forma notice, a table and chairs, and a staff member reading from a religious text to give a false impression.
• The council states there is no evidence of any member of the public ever attending any such service at any unit.
• David Schreiber is a director of Midos Group and of Brooklee Limited, the corporate entity that owns the park.
• Discovery Park’s chief executive, Mayer Schreiber, is a director of Midos and a shareholder in Brooklee.
• Another property used in the scheme is a former pub in Clapham, owned by David Schreiber’s company DMS Commercial UK.
• A neighbor said they had never seen any group events such as a prayer session at the Clapham site.
• Midos Management Co has collected at least £43m on behalf of landlords providing temporary accommodation to Lambeth Council since 2019.
• Midos Management Co is owned by Elizabeth and Jacob Endzweig.
• Elizabeth Endzweig said there was “no relationship whatsoever” between her business and Midos Group; the name was chosen based on preference.
• Birth and marriage records indicate Elizabeth Endzweig is the daughter of David Schreiber and his wife Miriam, who owns Midos Group (UK) Limited.
• Elizabeth Endzweig is a co-director of several businesses that operate from the same Stamford Hill address as Midos Group.
• Lambeth Council’s records showed Midos Estates, a subsidiary of Midos Group, receiving funds for temporary accommodation; Endzweig said this was an error.
• At least four other councils have paid Midos Management Co a combined sum of more than £2.5m over the past three years.
• Siobhain McDonagh, who chairs a cross-parliamentary group on temporary accommodation, said she was not convinced the companies were entirely unconnected.

Conflicting Reports

The source article describes conflicting accounts: lawyers for Midos Group and a spokesperson for Midos Management Co claimed no connection between the two entities, while records suggest familial and business overlaps. In the court claim, Dover District Council alleges that the faith room sessions were staged with no public attendance, while defendants stated the prayer sessions took place and the scheme was legitimately arranged to mitigate business rate obligations.

Still Unclear

Whether the faith room scheme actually involved genuine religious worship at the claimed units. Whether Midos Management Co is functionally independent from Midos Group despite familial and corporate overlaps. The full extent of tax avoidance or savings across all properties involved.

Misconceptions

The source article addresses the misconception that Midos Management Co and Midos Group are entirely separate and unconnected. Despite denials from both sides, public records indicate familial relationships, shared addresses, and co-directorships.

Key Figures

• David Schreiber (director of Midos Group and Brooklee Limited)
• Mayer Schreiber (chief executive of Discovery Park, director of Midos, shareholder in Brooklee)
• Elizabeth Endzweig (owner of Midos Management Co with Jacob Endzweig)
• Jacob Endzweig (co-owner of Midos Management Co)
• Miriam Schreiber (owner of Midos Group (UK) Limited)
• Siobhain McDonagh (chair of cross-parliamentary group on temporary accommodation)
• Verity (Greater Manchester-based property consultancy marketing the faith room scheme)
• Dover District Council (claimant in court case)

Sources: The Guardian