A father and son duo are facing charges after allegedly orchestrating a Goods and Services Tax (GST) fraud involving S$181 million in fictitious transactions through four shell companies.
The two Singaporean men were each handed four counts of fraudulent trading under the Companies Act on Tuesday (5 Aug), following joint investigations by the Inland Revenue Authority of Singapore (IRAS) and the Commercial Affairs Department.
Between November 2017 and April 2018, Derrick Yeo Wei Kin, 40, and his 73-year-old father Yeo Kian Huat are believed to have set up four companies that engaged in sham business dealings.
Goods were purportedly sold from one company to the others at highly inflated prices, resulting in fictitious sales totalling approximately S$181 million.
These false transactions were allegedly used to facilitate fraudulent GST refund claims from IRAS.
The younger Yeo is accused of submitting three such claims in an attempt to obtain S$11.8 million in refunds.
Source: Ministry of Finance (Singapore) on Facebook
Derrick Yeo also faces additional charges for allegedly forging a supplier’s invoice to support the GST registration of one of the shell companies.
He is further accused of submitting three fraudulent claims under the Electronic Tourist Refund Scheme (eTRS), which resulted in IRAS disbursing over S$140,000 in GST refunds for purchases that never occurred.
In total, he faces three counts of attempted cheating under the Penal Code, one count of forgery for the purpose of cheating, and three counts of cheating.
The case has been classified as a type of “missing trader fraud”, a form of GST scam where a seller charges GST on sales but disappears without paying the tax to IRAS, while businesses further along the supply chain continue to claim GST refunds on those transactions.
In court, Derrick Yeo pleaded not guilty to the charges, while Yeo Kian Huat indicated that he would be claiming trial.
Neither man is currently represented by legal counsel, and Derrick Yeo also faces other unrelated charges.
If convicted of fraudulent trading under the Companies Act, the accused may face up to seven years’ imprisonment, a fine, or both.
Cheating and forgery offences carry penalties of up to 10 years’ jail and a fine.
Also read: S’pore woman evades GST for luxury goods & teaches others how to do the same, gets S$18K fine
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Featured image adapted from Streetdirectory.