Vivo, which, along with two other Chinese smartphone makers accounts for 74 per cent of the Indian cellphone market, has been named as an accused in a charge-sheet filed by the Enforcement Directorate in a special court here on Wednesday. The chargesheet, filed under the Prevention of Money Laundering Act (PMLA), alleges that Vivo took out about Rs 1 lakh crore from India through shell companies.

The chargesheet names Hari Om Rai, founder and managing director of Lava International, for aiding Vivo. Similarly, Chinese national Guangwen Kyang alias Andrew Kuang, has been charge-sheeted for laundering money, along with chartered accountant Nitin Garg and Lava’s statutory auditor Rajan Malik, said sources aware of developments in the case.

The Chinese allegedly floated about 19 shell companies to spread a network that rinsed money earned out of business activities here, and then siphoned it out of the country.

ED conducts raids against Vivo, related companies in money laundering probe

Though Vivo claimed that it “adheres to ethical principles and remains dedicated to legal compliance,” the ED alleged that Rs 62,476 crore was “illegally” transferred by the Chinese company to avoid payment of taxes in India. The siphoning is said to have happened over a period of seven years starting from 2014, it is learnt.

Rai, who was arrested by the ED, said he has not been in touch with Vivo or its representatives since 2014, and even his previous engagement was to launch a joint venture in India.

On February 3, the ED registered a case after taking up a Delhi Police FIR against Vivo’s associate company, Grand Prospect International Communication Pvt Ltd (GPICPL), its directors and shareholders, among others.

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