India’s Enforcement Directorate (ED) recently carried out searches at 48 locations owned by Vivo Mobiles India Private Limited (VMIPL) and its many affiliates, including Grand Prospect International Communication Private Limited (GPICPL).
GPICPL was incorporated in 2014 by three Chinese nationals with the help of an Indian Chartered Accountant. The ED launched its AML/CFT investigation of the company after receiving reports from law enforcement authorities against GPICPL and its director, shareholders and certifying professionals etc. The allegation was that GPICPL and its shareholders had used fake identification documents and incorrect addresses when incorporating their company. Indeed, ED found that GPICPL directors had used the location of a government building and the house of a senior bureaucrat as their addresses. Moreover, VMIPL’s many affiliates transferred large sums of money to VMIPL. Further, VMIPL transferred nearly 50% of its total sale proceeds of ₹1,251.85 billion ($15.77 billion) to China. This allowed it to claim losses in the India-based companies and evade taxes in India.
Notably, VMIPL employees did not cooperate with the authorities during the search and even tried to abscond and conceal digital devices. Thus far, Indian authorities have seized 119 bank accounts containing over ₹4.65 billion ($59m), gold bars (2 kg), and cash of over ₹7.3 million ($92k).
Source: Enforcement Directorate, India
