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9 sought for organized tax fraud in Latvia

Xinhua, December 30, 2015 Adjust font size:

Nine suspects are currently facing criminal prosecution in the tax evasion case of Latvia's Gan Bei restaurant chain, a representative of the Latvian State Revenue Service told reporters on Tuesday.

Seven of the suspects implicated in the case are Gan Bei managers and employees, and two work for a company providing cash-register services. None of them have been remained in custody.

The prosecution against the above suspects is being sought for organized tax fraud, which under Latvian legislation is a criminal offense carrying a jail term of up to 10 years.

The revenue service's deputy head Kaspars Cerneckis said at a press briefing that the Gan Bei employees facing prosecution include accountants, cashiers and an IT specialist. One suspect is the company's chief financial officer (CFO) and another is a board member.

Although the names of the suspects were not disclosed at Tuesday's briefing, the Gan Bei CFO, apparently, is Galina Karmaca, wife of Member of Parliament Sergejs Potapkins of Latvia's leftist Harmony party.

Representatives of the State Revenue Service said Gan Bei restaurants had been using specially-designed software in the company's cash-register system with the aim to hide part of the income, as well as to distort bookkeeping data.

As a result of the company's illegal activities, the Latvian state budget lost nearly 958,000 euros (1.05 million U.S. dollars) in unpaid taxes.

In late 2014, law enforcement authorities raided a number of Gan Bei restaurants at several shopping malls in Riga, uncovering a tax evasion scheme that the chain's owners allegedly used to steal 700,000 to 800,000 euros from cash registers, or 50 percent of the company's monthly turnover.

The Gan Bei Asian restaurant chain belongs to Lage Ko, which is also the owner of Thali restaurant and Neo restaurants, among others. Lage Ko and Lage Ltd, which owns Galleria D'Arte restaurant, share the same registered address. Endit