Seven men charged over alleged link to GST tourist refund fraud

SINGAPORE - Seven men were taken to court on Friday (March 1) for their alleged roles in a ruse involving fraudulent Goods and Services Tax (GST) tourist refund claims totalling more than $14,000.

Palaniappan Ramanathan, a 41-year-old Singaporean partner in Abiraame Jewellers, and six of his employees were charged with offences under the GST Act.

At least four of the staff are Indian nationals. They are Kulamani Ganesan, 31; Shanmugam Sampathkumar, 33; Manickavasagam Saravanan, 40, and Murugesan Saravanan, 41.

The other two are Singapore permanent resident Arumugam Chelladurai, 48, and Malaysian Pang Wei Koon, 46.

Court documents did not state Arumugam's nationality.

Palaniappan faces the most number of charges - 74. The others face between two and 30 charges each.

The seven men are accused of committing the offences between 2015 and 2016.

 
 
 
 

They had allegedly issued electronic Tourist Refund Scheme (eTRS) tickets which allowed claimants to fraudulently claim GST cash refunds.

In a statement, the Inland Revenue Authority of Singapore (Iras) said that in a ruse involving jewellery, a tourist would pay local customers - who are not entitled to eTRS refunds - for their jewellery invoices.

By using these invoices and his or her passport, the tourist would obtain eTRS tickets from the retailer.

"The tourist would then claim eTRS GST cash refunds at a port of departure using the purchased invoices, the eTRS tickets obtained from the retailer, and a different jewellery, which he would have separately prepared," said Iras.

"In actual fact, the tourist would not be entitled to the eTRS refund, as he was not the actual purchaser of the jewellery referred to in the invoices," it added.

Iras investigators arrested the men on Thursday.

On Friday, all of them except Palaniappan were offered bail of $5,000 each. The Singaporean's bail was set at $10,000.

All seven men will be back in court on March 29.

Iras has stressed that it takes a serious view of such fraudulent GST refund claims and will not hesitate to take stern enforcement action against any individuals or parties involved.

For each charge, convicted offenders can be jailed for up to seven years and fined up to $10,000.

They will also face a penalty of up to three times the amount of unlawfully claimed refunds.