Zhejiang police crack down on economic crime, uncovering major tax fraud case

Wu Huixin
Chinese police fought more than 74,000 economic crimes nationwide last year, the Ministry of Public Security announced recently.
Wu Huixin

May 15 is designated as "the day of preventing and cracking down on economic crimes" in China. Chinese police fought more than 74,000 economic crimes nationwide last year, recovering over 23.6 billion yuan (US$3.39 billion) in economic losses and repatriating around 700 suspects from other countries, the Ministry of Public Security announced recently.

On the day, public security bureaus throughout Zhejiang Province launched a series of activities in collaboration with tax, commerce and market administrators, and visited companies to promote legal knowledge and shed light on relevant laws.

In Hangzhou, the Xiaoshan District Public Security Bureau uncovered a case of padding value-added tax special invoices. It was one of the largest cases in Hangzhou in recent years, involving 28 suspects and a total invoice amount of 35.4 billion yuan.

Xiaoshan police officers investigated over 300 companies, combed through around 120,000 invoices, checked about 630 bank accounts and 1,500,000 pieces of transaction details, and finally cracked down on the criminal gang in Jiangsu and Anhui provinces.

The Shangcheng Public Security Bureau has established China's first police station dedicated to intellectual property protection, providing legal services to companies and minimizing risks by strengthening early warning and forecasting systems. This move is an ongoing effort by the bureau to combat intellectual property infringements and counterfeit registered trademarks, as it believes that upholding the rule of law offers a safe and stable business environment.

In Zhejiang Province's northernmost Jiaxing City, police officers from the Jingkai Public Security Bureau hosted awareness activities, explaining to residents how to increase safety awareness of such crimes as contract fraud, bribery, misappropriation of funds and telecommunications fraud.

In efforts to promote anti-crime activities among more enterprises, police officers also visited companies on the day. Such visits have provided a much-needed shot in the arm for preventing economic crimes.

Following such constant visits to people and companies, telecommunications fraud in Jiaxing's Wenbo Residential Community has been dropping for three years.

Zhejiang police crack down on economic crime, uncovering major tax fraud case
Ti Gong

Police officer Zhang Qiujiang visits a local accounting firm.

"I have set up over 180 WeChat groups with over 7,300 users," said Zhang Qiujiang, a policeman working for Wenbo community. "Social media helps us in preventing telecommunications fraud among residents."

Its complicated demographic makeup and floating population make Wenbo Residential Community vulnerable to economic crimes. In recent years, criminals have used fake medicines, dietary supplements and illegal financial products to cheat older residents.

University students living in the community have become another major source of victims.

"University students are gullible. Telecommunications fraud targeting them, usually through fake shopping links and second-hand transactions, are different from the scams for the elderly," Zhang said.

"Frequently contacting students via WeChat has cut down the fraud cases obviously. They turn to me when they have problems with such online shopping links and transactions."

Individuals are potential targets for telecommunications fraud while companies are at risk of contract fraud, bribery and misappropriation of funds.

"All companies should have a legal consciousness," said lawyer Wang Aihua from Zhejiang Xingjia Law Firm. "For instance, a contract must be scrutinized by a professional in-house attorney before being signed.

"If startup companies cannot afford to hire professionals, they can turn to free legal aid services provided by the government."

Zhejiang police crack down on economic crime, uncovering major tax fraud case
Ti Gong

A resident learns the importance of increasing safety awareness.

In a bid to cut down the risk of economic crimes, Zhejiang Province initiated the "11087 Qinqing in Zhejiang" project in 2021. About 470 offline service stations and 100 online service stations have been established across Zhejiang so far.

These stations integrate the police service with the tax, commerce and market administrations, procuratorial departments and legal assistance agencies, offering services covering legal consultation, legal aid and mediation, among others.

On May 15, Zhejiang Province opened two provincial-level bases themed on preventing and cracking down on economic crimes. Thus far, the province has four bases of this type.

Zhejiang police have identified over 22,000 suspects related to economic crimes within three years. These bases will play the role of promoting legal knowledge and introducing significant cases.

To streamline work procedures and enhance efficiency, the Zhejiang Public Security Bureau has launched its own system that integrates big data from different government departments and places them all under one roof.

Zhejiang has organized 200 trainings for over 54,000 company leaders and management staff, aiming to enhance their legal awareness and cut down potential economic losses.

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