20 more companies in VAT scam probe

The Finance Ministry and the Revenue Department have accelerated the investigation into the Bt4.3-billion value-added-tax refund scam, finding that two more officials might have been involved in helping an additional 20 companies now being probed.

Sixty-five companies in total are now subject to the investigation. Of the total, 20 companies were initially investigated, with the probe into these businesses having been concluded in August. 

Eighteen senior officials in the Revenue Department were made the subject of disciplinary probes as a result.

The investigations into another batch of 25 businesses is reaching a conclusion. However, a further 20 companies were recently implicated in the scam. 

Prasit Suebdhana, Finance Ministry inspector-general and chairman of the committee handling the investigation, said that those suspected of involvement in the VAT refund scam in these additional 20 companies were the same private group, or were related to the group uncovered when the first 20 firms were investigated – and that two more Revenue officials might have been involved.

Of the two officials, one is an operational staff member and the other an expert.

The panel will propose that Rungson Sriworasat, Finance Ministry permanent secretary, should consider whether a disciplinary committee should be set up for these two individuals.

Meanwhile, the main committee’s work has been speeded up since Sutthichai Sungkamanee became Revenue Department director-general and the agency has documentation on all 65 companies involved in the scam, Prasit said. The previous incumbent was Sathit Rangkhasiri.

 In August, the committee submitted to Areepong Bhoocha-oom – then permanent secretary of the ministry – the conclusions of the probe into the first 20 companies investigated, and recommended disciplinary probes into 18 senior and other officials in the Revenue Department. 

Of the 18 suspects, four hold positions of senior director and specialists at the C-9 level, while the rest are officials at the operational level.

The Revenue Department has been ordered to set up a disciplinary committee to probe the 14 operational officials further, while the ministry’s disciplinary panel is investigating the four senior officials.

“Based on the investigation, the first and second groups [20 companies in each] of wrongdoers are related, or are the same,” said Prasit.

The second group of companies claimed that steel scrap had been sent abroad, hence they were entitled to a VAT refund. However, the Customs Department found that pieces of rock had been shipped instead, and informed the Revenue Department of the major discrepancy. 

Later, the companies notified the police that their products had been stolen from containers and replaced by rock, and provided daily notices as evidence. 

Revenue officials finally approved a VAT refund worth Bt30 million without any investigation into whether or not steel scrap had in fact been exported.

The investigation into the remaining 25 companies targeted by the authorities is reaching its conclusion, including the amount of VAT refund involved. The findings will be reported to the Finance permanent secretary.

These firms claimed that they had exported computers to neighbouring countries. However, it was later discovered that vegetables and fruit were actually shipped, meaning that the exporters had claimed the incorrect VAT refund.

 Sutthichai said the disciplinary probes into 14 officials had been completed yesterday, with the results and accusations notified to the individuals. All suspects have 60 days in which to make any clarifications to the disciplinary panel.

“However, if there remains strong evidence of wrongdoing, the heaviest disciplinary penalty is dismissal. For this group of officials, the Office of the National Anti-Corruption Commission can make a criminal case as there are several agencies involved,” he added. 

The agencies in question are the Finance Ministry, the Revenue Department, the Department of Special Investigation, the National Anti-Corruption Commission and the Anti-Money Laundering Office.