THE result of a police raid on a Douglas tax consultancy firm last year produced so much negative publicity it led to 40 people losing their jobs, according to the company.

The Montpelier Group - based in Fernleigh House, Palace Road, Douglas - is so unhappy with what it described as an “inappropriate police search” that it has decided to make a claim for damages against the police and Customs & Excise.

The Douglas office was searched by Customs officials and police officers in September last year, but the warrant used in the operation was later quashed in court and the entry declared “unlawful.”

A spokesman for Montpelier said, "While it is pleasing the Isle of Man search warrant has been quashed that is of no comfort to those members of staff who lost their jobs.

"Montpelier will now pursue a claim for substantial damages for the unlawful entry, search and seizure from the Isle of Man Constabulary."

The searches were said to be part of an investigation centred around the suspicion that tax avoidance schemes had been implemented fraudulently.

A statement from the Isle of Man police said, "The Isle of Man Constabulary was directed to assist Her Majesty's Revenue and Customs by Her Majesty's Attorney General’s Chambers following a Letter of Request being received under the island's Mutual Legal Assistance Treaties.

"The legality of these searches was later challenged and the Constabulary believes the Attorney General has accepted that there were technical problems with the assistance provided."

Montpelier has 52 offices in over 20 countries with more than 700 staff. Its business is centred around investment and financial advice and tax planning for private clients. It has offices in the UK, Barbados, Hong Kong and the Isle of Man.