Police in Thanh Hoa Province in central Vietnam announced that they had summoned 30 people for an investigation into tax evasion carried out through POS terminals registered under small business entities.
During questioning, the suspects, from Thanh Hoa and Hanoi, said they had carried out transactions worth nearly VND15 trillion (US$580 million) in total, generated nearly VND100 billion in revenue and evaded tens of billions of dong in taxes.
Police seized nearly 400 POS terminals, 10,000 bank cards, 95 mobile phones, 20 computers and various documents.
Earlier, Thanh Hoa Provincial Police discovered that several people were using POS terminals to provide credit card balance settlement and cash withdrawal services.
The operations involved large transaction volumes, but the people involved had neither registered businesses nor fulfilled their tax obligations.
Initial investigations showed that the suspects used small business credentials to open bank accounts, then rented, borrowed or obtained POS terminals through payment intermediaries.
The group advertised cash withdrawal and credit card settlement services on social media, charging 1.5 to 2 per cent per transaction.
They processed customers' credit cards through POS terminals as if they were payments for goods or services, although no sale had taken place. The money went to accounts they controlled, and they gave customers cash after deducting the fee.
For credit card balance settlement, the group deposited money into a customer's credit account and immediately processed the card through a POS terminal to recover the funds.
They expanded by renting more POS terminals, hiring staff and seeking clients through social media and personal connections.
Under Vietnam's banking regulations, withdrawing cash from credit cards via POS terminals is not legally recognised. Such transactions are fictitious because POS terminals are designed for payments for goods and services, not cash withdrawals.
A business that facilitates a credit card transaction and then provides cash is misusing the payment system and creating significant risks.
The case remains under investigation.
Sources: Viet Nam News
