1. Tan Nuan Seng Francis, the last of three accused persons who were charged for their involvement in perpetrating a Goods and Services Tax Missing Trader Fraud involving approximately $55 million in fictitious sales, was convicted and sentenced to an imprisonment term of four years and two months.
2. Perpetrators of the GST Missing Trader Fraud seek to abuse the GST system to generate illegal proceeds through a string of false transactions. These false transactions ultimately form the basis of fraudulent GST refund claims made to IRAS.
3. Tan Nuan Seng Francis operated M_Solution Trading Pte Ltd, which was a shell company with no real business, to commit the GST Missing Trader Fraud against IRAS. His accomplice, Yeo Soon Teck Kelvin, operated another company, Crescendo Hardware Trading Pte Ltd, as part of the same fraud.
4. Both of them forged sales invoices issued by M_Solution Trading Pte Ltd for purported sales of goods amounting to approximately $55 million. These goods were purportedly sold through chains of other business entities (including Crescendo Hardware Trading Pte Ltd ) and eventually to exporters, who made claims for GST refunds from IRAS.
5. These sales invoices were a sham as there were no genuine sales or deliveries. GST was also fraudulently charged on these sales even though M_Solution Trading Pte Ltd was only GST-registered from 1 December 2015. These fictitious sales invoices were generated to support the subsequent GST refund claims submitted by the exporters.
6. This fictitious transactions resulted in the submission of fraudulent GST refund claims amounting to approximately $7.53 million to IRAS. Of the $7.53 million in fraudulent GST refund claims filed, IRAS had paid out about $2.04 million in GST refund.
7. To clamp down on this fraudulent GST refund claims, IRAS will deny the input tax claims on any GST-registered business that claims input tax on any supply made to them which it knew or should have known to be part of a Missing Trader Fraud arrangement. Businesses are therefore strongly advised to perform due diligence checks and take appropriate actions to address the risks identified to avoid participating in transactions suspected to be part of a Missing Trader Fraud arrangement.
8. IRAS take a serious stance against GST Missing Trader Fraud offences and will take stern enforcement action against perpetrators of such fraudulent arrangements. Businesses or individuals are encouraged to immediately engage professional accounting firm like PL Biz Consulting if they suspect any transactions that they entered into to be part of a Missing Trader Fraud arrangement. PL Biz Consulting will try to assist businesses or individuals perform due diligence checks and take appropriate actions to address the risks identified.
9. Please contact us if you need any assistance. At PL Biz, we have the right people and expertise to help guide and explain to you on how to go about complying with IRAS GST requirements..
