A man who conjured up a ruse to defraud a government productivity scheme and helped others submit false claims to the scheme pleaded guilty after a five-day trial.
S. Chandran, an IT instructor turned magician, helped 49 applicants submit fraudulent claims to the Productivity and Innovation Credit (PIC) scheme between June 2013 and July 2014, seeking payouts totalling over $1.1 million.
The Inland Revenue Authority of Singapore (Iras), which runs the scheme, disbursed $876,684.
Yesterday, Chandran, 37, pleaded guilty to 18 charges under the Income Tax Act involving more than $400,000 in cash payouts and bonuses. Forty other similar charges linked to the remaining amount will be taken into consideration during sentencing.
The PIC scheme offers tax deductions or cash payouts to companies that have made genuine investments to enhance productivity and innovation, such as by investing in staff training, information technology or automation equipment. As part of the conditions, firms must have at least three local employees.
However, though the applicants did not meet the qualifying conditions, Chandran, the sole proprietor of Paradize Consultancy, helped them in exchange for half of the amounts disbursed.
Deputy Public Prosecutors V. Jesudevan and Christopher Lim, as well as Iras' senior tax prosecutor Norman Teo stated in their court documents that Chandran "held himself out as a PIC consultant".
He used platforms such as social media to seek out interested parties, claiming he could assist them to "claim government grants and get some cash back".
Chandran helped the applicants submit the necessary paperwork to Iras. If they did not have a registered company - one of the criteria to qualify for a PIC claim - he had one registered on their behalf.
Similarly, to make it appear as though the applicants had employed three local employees, he directed them to get the particulars of other individuals and falsely enlist them as workers on the PIC forms.
The prosecutors stated: "Even though in reality, these applicants would not have qualified for a PIC payout, Chandran nevertheless submitted the above supporting documents on the applicants' behalf."
Some of the applicants have already been dealt with.
On May 26, eight Singaporeans were ordered to pay a penalty of between $24,606 and $49,212 for making false PIC claims. Most were also fined up to $5,000. They include K Creative owner Kavi Kumar Premkumar, 28, and Saravanan Darmalingam, 35, sole director of VDMSS Engineering.
The case against Chandran's wife, A.K. Sahtyah J. Alexander Vincent, 30, who is allegedly linked to the scam, is still pending.
Chandran, out on $200,000 bail, is expected to be sentenced on Jan 11. He has made no restitution.
For each charge, he can be jailed for up to five years and fined up to $50,000. He may also have to pay a penalty up to four times the amount of payouts and bonuses disbursed.