ED files chargesheet against Vivo for money laundering

NEW DELHI | Updated: 07 December, 2023 5:07 pm IST

NEW DELHI:  The Enforcement Directorate (ED) has filed a chargesheet against Vivo India under the Prevention of Money Laundering Act, on Thursday.

The ED had submitted an affidavit to the Delhi High Court, accusing Vivo India of engaging in money laundering activities that undermine the stability of India’s financial system and challenge its sovereignty.

The affidavit, filed recently, states that the agency is scrutinising suspicious financial transactions across 22 firms associated with the Hong Kong-based entity, which allegedly transferred substantial amounts of money to China.

 

Earlier in October, the ED had arrested four accused including Hari Om Rai, the Chairman of Lava Mobile, Chartered Accountants Nitin Garg and Rajan Malik, and a Chinese national, Guangwen alias Andrew Kuang.

Among the targets of investigation is Grand Prospect International Communication Private Limited, a Jammu and Kashmir-based distributor of Vivo. The distributor was allegedly established using forged documents, which falsely claimed affiliation with Vivo India through an email address linked to the mobile company’s records at the Ministry of Corporate Affairs.

A Delhi-based Chartered Accountant firm reportedly aided in setting up this J&K-based company and has maintained ties with Vivo India since 2014.

The ED disclosed that Vivo India is linked to the incorporation of 22 firms across different states allegedly involved in money laundering, with the assistance of the Delhi-based CA firm.

While the cell phone manufacturers previously claimed adherence to Indian laws, the ED’s assertions contradict these claims. Additionally, top executives of Vivo, Zhengshen Ou and Zhang Jie, are said to have fled India via Nepal.

 

In February this year, the ED had initiated a PMLA case against them based on an FIR filed at the Kalkaji Police Station in Delhi, against Grand Prospect International Communication Private Limited (GPICPL) under various sections of the Indian Penal Code and its stakeholders.

The FIR alleges the use of forged identification documents and false addresses during the company’s incorporation, which was confirmed during the course of the investigation. Officials found out that the address belonged to a government building and a senior bureaucrat’s residence.

The ED claims that out of Vivo India’s total sale proceeds of Rs 1,25,185 crores, Rs. 62,476 crores, approximately 50% of the turnover, was remitted out of India, primarily to China.

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