India’s enforcement directorate researched 40 locations in Vivo India and the state agency revealed details about the investigation. According to an official press release, the company transferred INR 62,476 crore (equivalent to nearly $ 8 billion) to China.
During the investigation, the ED seized 119 bank accounts with INR 465 crore (approximately $ 58 million) in them, as well as 2 kg of gold bars, an extra INR 66 crore ($ 8.3 million) in FD and 73 lakhs (just under $ 100,000) in Cash.
The Enforcement Directorate’s statement revealed that the amount of money channeled into China is about half of all sales made by Vivo India. This was done “to reveal huge losses in Indian incorporated companies” and to avoid paying taxes on this money.
Vivo India directors Zhengshen Ou and Zhang Jie fled the country when management revealed that “some Chinese citizens”, without mentioning any names, had removed and hidden digital evidence of money laundering.
Money transfers were made via a Hong Kong-based shell company – vivo India was registered as its subsidiary and had smaller entities in each of India’s major regions operating alone, at least as far as books are concerned . Then they sent all profits to live India, which, being a subsidiary, channeled the funds directly into its parent company.
According to representatives of Vivo India, the brand “has collaborated with the authorities and is committed to fully respecting Indian law”. The parent company in China expressed hope that the ongoing investigation will be conducted in “a truly fair and non-discriminatory business environment”.
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