Illegal raw material export

“Looking for trouble” when working as the hired director . Illustration photo.

Exporting waste illegally in the name of “processing”

In late 2015, through reviewing and controlling the local situation, the Anti-smuggling control Team in the North, the Anti-Smuggling Investigation Department, and the General Department of Customs discovered abnormal signs from export activities of a business in Hung Yen province.

The unusual thing is that although the enterprise has just been established, it signed a scrap export contract with large quantities in the form of exporting raw materials for hiring processing abroad. It is considered a rare export-import type and high reputation and potential economic enterprises which operate in the long term seek profit this way. Customs anti-smuggling force collected information to identify.

According to informationgathered, the company is Minh Trong Production and Trade Co. (hereinafter referred to as the Minh Trong Company, MST: 0900914888, address: Vien hamlet, Nghia Trai village, Tan Quang commune, Van Lam district, Hung Yen province), established in March, 2015, Lai Quoc Anh was the owner and legal representative. ToJanuary, 2016, the ownership and legal representative title was transferred to Ms. Nguyen Thi Mien. Since the company was establishment (March, 2015 to March 24th, 2016), the company has opened several export declarations for processing scrap. However, up to now, although the validity of the contract expired, it did not import finished products and did not sign.

The investigation and verification results of Customs authorities showed that the Minh Trong Company opened 41 export declarations in the form of exporting raw materials for hiring processing abroad. Now, the company exported 233 steel scrap containers, weight of 5,592 tons, worth of $US 1,543,392. The entire goods of the Company were exempted from export tax as stipulated in Clause 4, Article 103 of Circular 38/2015/TT-BTC. Under the current tax rates, the export stainless steel scrap hasa 15% tax rate, so that, the amount of provisional payable tax of the Company was 5.1 billion vndfor 41 declarations.

To make export procedures for the above shipments, the Minh Trong Company presented to Customs authorities only 1 contract No 01 /MT-TS/2015 dated May 20th, 2015 signed between the Company and Tarsan International Pte. Ltd Company in Singapore to process stainless scrap steel in the form of rolls and bars. The validity period of the contract was from May5th, 2015 to May 5th, 2016. However, until now, the Company has not exported any shipment of finished products.

According to the content of the processing contract, all shipments wereexported to the processing partner, Tarsan International Pte. Ltd. in Singapore. However, through the collection of intelligence information, Customs discovered that all shipments were transported to the different countries and territories such as India, Taiwan, Thailand, ...

Through collecting and exchangingthe intelligence information from Singapore Customs, Vietnam Customs identified: Tarsan International Pte LtdCompany had not signed anoutsourcing contract No 01/MT-TS/2015 with the Minh Trong Company. The contract holder was not an employee of Tarsan International Pte Ltd Company and the bank account specified in the contract was not the Singapore company.

With the information and evidence, Vietnam Customs identified the processing hiring contract of the Minh Trong Company which was presented to the Customs authorities to carry out the export procedures for processing steel shipments. In fact, the company did not operate processing aboard.

Paying 2 millionvndfor renting a “nominal” director

To clarify the evidence of the case, the Customs authorities carried out a verification of the 2 individuals being legal representative of the Minh Trong company, Lai Quoc Anh and Nguyen Thi Mien. The verification result showed that Mr. Lai Quoc Anh was hired as Director of the Minh Trong company, with asalary of 2 million vnd per month.

However, he was only the nominal name in documents, in fact, Ms Nguyen Thi Mien operated thereal activities of the Minh Trong Company (located at Ca Hamlet, Tot Dong commune, Chuong My district, Hanoi). Whenever there was a need to sign documents, or records, Ms Mien rented a motorbike taxi to bring them to Lai Quoc Anh house to sign. Mr Lai Quoc Anh did not keep the seal of the Company and also any document which he signed.

Because of low wage, no money to contribute capital and no profits divided, Mr. Lai Quoc Anh refused to continue working as Director of the Minh Trong company. From January 7th, 2016, the company was transferred to Ms. Nguyen Thi Mien. For the company transferring, Mr. Lai Quoc Anh did not directly do procedures, just gave his identification to Ms. Mien. Declaring to Customs authorities, Mr. Lai Quoc Anh confirmed that he had not signed any contract in English, as well as the contract number 01/MT-TS/2015 during working as the Director. All documents signed by Mr. Lai Quoc Anh were in Vietnamese, there were not any documents in a foreign language because he did not know any foreign language.

InJuly, 2016, the Anti-Smuggling Investigation Department verified the identity of Nguyen Thi Mien in the Tot Dong commune police, Chuong My District, Hanoi. Here, the Commune police said that Nguyen Thi Mien had died on July 16th, 2016.

For further verification of evidence, the Customs authorities coordinated with the Tot Dong commune police to work with Nguyen Thi Nhat ((mother of Nguyen Thi Mien). At the meeting, Ms. Nhat said Nguyen Thi Mien finished Grade 4 or Grade 5, did not read and write fluently because of leaving education early. In 2011, Nguyen Thi Mien wasfound to have kidney failure, then, had to use dialysis 3 times a week. In addition to the duration of treatment in hospital, Nguyen Thi Mien had just rested at home because her health was very weak. Nguyen Thi Mien’s family was very difficult, was classified in poor households, and was assisted at 350 thousand vnd a month by the commune budget

The verification results of the Customs authorities showed that the two suspectsbeing Director of the Minh Trong Companydid not have stable jobs, had difficult circumstances, low education levels, therefore, they could not have the ability and qualification to establish the company as well as operate and direct the illegal export to evade tax with large goods quantity and worth (over 30 billion vnd).

The verification results in banks showed that all two suspects in the name of the company director did not have any banking account and had never withdrawn from or deposited to the Company account. Transactions in the account only were carried out by Nguyen Thi Phuong and Nguyen Thi Hoa (the shippers). Both Lai Quoc Anh and Nguyen Thi Mien had just signed the papers relating to the procedures, the Customs procedures were implemented by others.

As theverification result of Customs authorities, Minh Trong Ltd Company hadcounterfeiteda contract to hire outsourcing for implementing export procedures. When being discovered, the relevant suspectsincluding Lai Quoc Anh, Nguyen Thi Mien, Nguyen Thi Phuong, Cu Thi Thinh and Director of the Linh Duong Company foundanyway to evadeCustoms authorities. Based on the investigation results, the authorities had a basis to determine that the Minh Trong Company had signs to constitute smuggling as defined in Article 153 of the Criminal Code