Vivo India confiscated $58 million and 2 kg of gold bullion - Indian unit accused of money laundering
The Enforcement Directorate of India is conducting a major investigation into Vivo India, which is accused of money laundering.
What does this mean?
The statement says the company transferred 62,476 crore Indian rupees (about $8 billion) to China, which, for a minute, is about half of Vivo India's total sales. The department's commentary notes that this was done "to disclose the huge losses of Indian registered companies" and to avoid paying taxes on the money.
The remittances were made through a front company based in Hong Kong - Vivo India was registered as its subsidiary, and it had smaller units in every major Indian region that operated independently, at least for accounting purposes. They then funneled all profits to Vivo India, which, as a subsidiary, funneled funds directly to its parent company.
The investigation blocked 119 Vivo India bank accounts and confiscated 465 crore Indian rupees (about $58 million) in those accounts, 2 kg of gold bullion, an additional 66 crore Indian rupees ($8.3 million) in FD and 73 lakhs (just under $100 thousand) in cash.
Meanwhile, Vivo India representatives stressed that the brand "cooperates with the authorities and strives to fully comply with Indian law." The parent company in China expressed hope that the ongoing investigations will be conducted in a "truly fair and non-discriminatory business environment."
Recall that just a few months ago India seized $725 million worth of Xiaomi assets following an investigation that revealed the smartphone maker was making illegal money transfers to foreign entities, passing them off as royalty payments.