Why gold smuggled in export, import?

Evidence of the transportation of 28.5 kg of gold was detected and arrested by the Customs forces in collaboration with the investigation police of the Hanoi Police on August 25th.

All tricks

In the early days of September, the Customs forces and the Police forces prosecuted repeatedly two criminal cases to investigate illegal cross-border movements of gold. In relation to these cases, on August 28th, 2017, at the customs inspection and surveying site, Wing B, T2 Terminal of the Noibai Airport, during customs procedures for exit passengers, the Procedure Team of Baggage of Exit Passengers (the Customs Sub-Department of Noi Bai International Airport) detected in personal luggage of passenger, Nguyen Van Linh (passport number: C1999890, Nationality Vietnam) in doubt by scanning luggage. By the reality luggage inspection, the Customs forces discovered two pieces of raw gold (total weight: 360 gr).

Just a few days ago, on August 25th, the working group of the Team of anti-smuggling and anti-trading prohibited goods, the Police Department of Economic Crime Investigation on the economic and occupation management (PC46), the Police Department of Hanoi cooperated with the Customs Sub-Department of Noi Bai International Airport (the Hanoi Customs Department) to inspect 5 passengers on TG564 flight from Thailand into Vietnam. Under the detection result, the functional force revealed 5 objects hiding many packs of the gold, and white metal in form of gold-plated jewelry in their bodies: bracelets, necklaces, earrings,… without declaring. The total weight of suspected gold jewelry was about 28.54 kg. All the gold were hidden by wrapping them around the bodies of objects, they boarded together TG564 flight flying from Bangkok to the Noi Bai International Airport, Vietnam. When crossing the customs area, the objects did not carry out the customs procedures for the hidden gold and the Customs offices coordinated with the Police Investigation Agency to arrest them. The objects also claimed that they transported gold jewelry from Hong Kong to Vietnam successfully, and they were paid 10 million VND per person per trip.

Leaders of the Customs Sub-Department of the border gate of the Noi Bai International Airport said that because gold is a valuable commodity, the objects found all ways to hide; even the objects wrapped gold around their body, thighs, and shins to escape the notice of functional forces, this was a new smuggling trick.

Last year, the Noi Bai International Airport Customs in collaboration with the Hanoi Police found that the spouse of former flight attendants transported 80 tons of gold to Korea. All of this gold was camouflaged in a plastic bag, wrapped tightly in black sticky tape with a magnet, hidden by attached under the seats.

Not only smuggled gold through the air, in March 2017, the Tinh Bien Border Gate Customs Sub-Department (An Giang) in collaboration with the Tinh Bien International Border Guard Station arrested a person transporting 100 million Riel -Cambodia and 8 kg of gold across the border, the total value of material evidence was about 7.6 billion.

Price difference, tax evasion

According to the experts, the main cause of gold smuggling was the source of profit difference between the domestic gold price and the foreign gold price, and at the same time, illegal gold evaded the prescribed taxes. Mr. Dinh Nho Bang, Vice Chairman and General Secretary of the Vietnam Gold Business Association, said that this was also the rules of the market, when there was a gold price difference between domestic and foreign markets, the objects took advantage of the difference to make a profit, when the domestic price was cheaper, the objects would export smuggled abroad.

In fact, there are times when the gold price in the domestic gold market is different from international gold price from 2 to 3 million VND per a tael. The gold expert, Dr. Nguyen The Hung said that domestic and international price differences were the main reason for the smugglers make profits. "The State wants to limit import, but in some extent, the import of raw material gold should be loosened to serve jewelry production because the demand for production is not large. At present, the regulations on the gold import standard of the enterprises in jewelry production have expanded, but the procedures are very complicated, the enterprises have to prove their business situation, the types of sub-licenses so it is difficult to implement” - Mr. Nguyen The Hung said.

The reason for domestic gold transported to the border, according to the experts, although the domestic gold price was much higher than the world gold price, mainly, SJC 99.99 gold pieces have been exclusive distribution. For raw material gold, odd gold, sometimes, the domestic gold prices were lower than the price in some countries up to million VND. Thus, if the success transportation, the smugglers could earn up to hundreds of million VND.

In particular, an issue that many gold enterprises recommended is that the National Assembly passed the amended Investment Law by the end of 2016. In particular, the list of conditional lines of business was regulated other forms of conditional gold production and trading including Gold trading was a conditional investment business which covered all production activities; processing; trading; import-export; services related to gold pieces, gold jewelry, fine art gold, raw material gold. Thus, this regulation has tightened for the gold enterprises, even, the enterprises also said that this would cause the lack of gold raw materials for the production of gold jewelry, fine arts, would force the enterprises to buy floating goods in the market, it would be likely to cause gold smuggling more seriously.