[ad_1]
India’s financial crime agency has arrested a senior Vivo executive and three other individuals in a money laundering case. The Enforcement Directorate (ED) took Guangwen Kuang, the head of administration at Vivo India, into custody earlier this week following a lengthy investigation. The company has denied the allegations and plans to exercise its legal options.
India arrests Vivo executive in a money laundering case
This case dates back to July 2022 when the ED raided 48 locations belonging to Vivo in India and seized ₹4.65 billion ($59 million) from its bank accounts. The agency found that the Chinese smartphone maker had illegally transferred ₹624.8 billion ($7.9 billion) to its parent organization BBK Electronics (which also owns Oppo, OnePlus, Realme, and iQOO) in China over five years. The amount is almost half of Vivo’s revenue total revenue during this period.
This transfer allowed the company to report losses in India, effectively evading taxes. The ED said Vivo evaded taxes worth ₹22.1 billion ($280 million). An investigation followed, subsequently leading to the arrest of Kuang, who is a Chinese national. Kuang’s lawyer, Mudit Jain, confirmed the arrest to CNN and revealed that the ED has held the executive in a three-day custody.
The agency, which is responsible for probing money laundering and violations of foreign exchange laws in India, wanted the Vivo official’s custody for ten days but the court only allowed three days, the publication reports citing a court document. The names of the other three arrested individuals aren’t known. One of them is reportedly a person who had helped Vivo set up its offices in India. The other two were accountants.
In an official statement following Kuang’s arrest, Vivo said that it’s cooperating with the authorities and also exploring its legal options. “The recent arrest deeply concerns us,” a company representative said. “Vivo firmly adheres to its ethical principles and remains dedicated to legal compliance.” The representative confirmed that the firm would “exercise all available legal options.”
India has also accused other Chinese smartphone companies of malpractice
Vivo isn’t the only Chinese smartphone company facing legal troubles in India. The country’s financial crime agency is also investigating Oppo and Xiaomi over similar allegations of money laundering. These three firms jointly capture about 45 percent of India’s overall smartphone market.
The investigations from the ED come amid rising tensions between the world’s two most populous countries. The tensions aren’t limited to trade and economy but have mostly risen from the decades-long border dispute along the Himalayas. Military troops from India and China often clash at the border, resulting in fatalities. India’s crackdown on Chinese smartphone makers could now make the matter worse. The country has previously banned more than 100 Chinese apps, including TikTok, citing a national security risk.
[ad_2]
Source link