Trouble Mounts For Vivo As Three More Officials In ED Net Over Money Laundering Probe

SUMMARY

Recently, four others were detained under the Prevention of Money Laundering Act (PMLA) related to Chinese smartphones, and their judicial custody was extended by a Delhi court last month

ED has also filed a chargesheet against Vivo under the PMLA, which named 23 other associate companies, including Lava International

The ED started its investigation against Vivo-India in 2021 with suspicions that the company had illegally transferred more than INR 60,000 Cr to its Chinese entity to avoid paying taxes in India

More trouble seems to be brewing for Vivo as the Enforcement Directorate has made three more arrests in connection with its probe against Chinese smartphone makers.

Official sources familiar with the case informed Business Today.

Recently, four persons were detained under the Prevention of Money Laundering Act (PMLA) related to Chinese smartphones. The names included Lava International MD Hari Om Rai, Chinese national Guangwen alias Andrew Kuang as well as chartered accountants Nitin Garg and Rajan Malik.

The Delhi High Court has also dismissed a petition filed by smartphone manufacturer Vivo after the arrests, which challenged the order that sent the officials under the custody of the ED custody.

Last month, their judicial custody was extended by a Delhi court.

As per various reports earlier this month, the ED has also filed a chargesheet against Vivo under the PMLA, which named 23 other associate companies, including Lava International.

Allegedly, Vivo has diverted proceeds of nearly INR 1 Lakh Cr from India to overseas through shell companies.

The ED started its investigation against Vivo-India in 2021 with suspicions that the company had illegally transferred more than INR 60,000 Cr to its Chinese entity to avoid paying taxes in India.

Later, in July 2022, the ED raided 48 premises linked to Vivo. Back then, the ED alleged that the Chinese smartphone manufacturer transferred proceeds of around INR 62,476 Cr out of India.

Amid the charges, the government had also put a halt to the export of 27,000 Vivo phones from India worth $15 Mn.

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