Vivo Visa Fraud Scandal : Money Laundering Unearthed in India

In a shocking revelation, employees of Chinese smartphone manufacturer Vivo and its Indian associates are facing allegations of concealing their employment status when seeking visas and flouting Indian visa rules by visiting sensitive regions, including Jammu and Kashmir.

India’s financial crime agency, the Enforcement Directorate, has brought these allegations to light, casting a cloud over Vivo’s operations in the country.

The accusations, outlined in a court filing that is not public, have surfaced when tensions between India and China have escalated due to stricter investment regulations imposed by New Delhi and the ban on hundreds of Chinese apps. These measures followed border clashes in 2020, which resulted in the deaths of 20 Indian and four Chinese troops.

Vivo Visa Fraud Issue Viral

The recent arrest of Vivo executive Guangwen Kuang in a money laundering investigation initiated in 2022 has further fueled the controversy surrounding India’s second-largest smartphone player.

The Enforcement Directorate revealed that at least 30 Chinese individuals entered India on business visas and worked for Vivo without disclosing their affiliation with the company in their visa application forms. These individuals have also been accused of violating Indian visa conditions by travelling to sensitive areas in Jammu, Kashmir, and Ladakh.

In the 32-page filing, the Enforcement Directorate stated, “Many employees of Vivo group companies worked in India without appropriate visas. They have concealed information regarding their employer in their visa applications and cheated the Indian embassy or missions in China.”

When asked for a response, Vivo, with a market share of 17%, reiterated its concern over the executive’s arrest, stating that it remains “dedicated to legal compliance.” China’s foreign ministry, which has been closely monitoring the case, did not provide any comment, and both the Indian embassy in Beijing and the foreign ministry in New Delhi also remained silent on the matter.

The ongoing border dispute between India and China has led to strict regulations regarding foreign nationals’ entry and stay in areas such as Ladakh and parts of Jammu and Kashmir, which are designated as “protected.” Visitors to these areas are required to obtain a permit separate from their visa.

The Enforcement Directorate had previously conducted raids on 48 sites associated with Vivo and its affiliates as part of the money laundering investigation. The agency accused Vivo of illegally transferring funds to China to evade Indian taxes through companies it indirectly controls.

The recent court filing claims that an astonishing 1.07 trillion rupees ($12.87 billion) were remitted outside India by Vivo to trading companies controlled by its Chinese parent company, which the agency described as a “masking layer” intended to evade government detection.

The Enforcement Directorate added, “While no profits were shown from 2014-15 to 2019-20 in the statutory filings and no income taxes were paid … huge sums were siphoned off out of India.”

Last year, the agency estimated that approximately 624.7 billion rupees ($7.5 billion) had been remitted primarily to China, further deepening the allegations against Vivo.

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