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CHINA> National
Police nab 5,134 suspects over invoice frauds
(Xinhua)
Updated: 2009-10-27 20:12

BEIJING: Chinese police have detained 5,134 people in a 10-month national campaign against invoice fraud, Wu Heping, spokesman for the Ministry of Public Security, said Tuesday.

A total of 1,045 production sites making and selling fake invoices were closed, and more than 80 million fake invoices were confiscated, Wu told a press conference.

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In addition, the police arrested 540 people on charges of tax evasion and tax fraud by using fake invoices in coordination with the tax authorities, he said.

Fake invoice vendors are common in Chinese cities, where they offer receipts used for tax purposes.

Wu said invoice fraud could cause huge losses in tax revenues and would feed illegal activities, such as smuggling, money laundering and corruption.

Wu said close to 28.4 million, or more than 35 percent, of all fake invoices confiscated in the last 10 months was seized in the southern Guangdong Province.

Police raided two fake invoice production sites in Foshan city in August, and arrested nine people and seized more than 16 million fake invoices. The figure equaled close to two thirds of the total fake invoices confiscated nationwide last year.

Wu said fake invoices were most commonly used in the catering and retailing sectors, as they accounted for 51 percent of all fake invoices seized in the crackdown. However, invoice fraud in the construction and transportation sectors had led to much bigger losses of tax revenues.

He also warned of invoice fraud by government and government-sponsored institutions, saying "it cannot be dismissed easily."

A gang of people were arrested in the central Henan Province in January for making 8,000 fake invoices with a total face value of 1.6 billion yuan (US$234 million). More than 18 percent of the invoices were sold to the local government and government-sponsored institutions, said Wu.

 

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