End of four-year investigation
SFO decides not to file charges against Zespri
Ending a four-year investigation into the legislated fruit export monopoly the Serious Fraud Office has decided not to file charges against Zespri Group over dual-invoicing.
Director Julie Read said the white-collar crime investigator found the evidence didn't meet a high enough standard to lay charges after investigating allegations Zespri facilitated tax evasion while exporting kiwifruit to China by providing false invoices to its importer to use in declarations to Chinese officials.
"In this case the practice of dual invoicing facilitated criminal offending in China. The lower-valued invoice was used by Zespri's importer to evade duty and resulted in him being convicted for the Chinese offence of smuggling," Read said in a statement. "The instrument of that offending was created by Zespri in New Zealand. For that reason the matter properly came to the attention of the SFO."
Read said New Zealand exporters should approach the practice of dual invoicing with "extreme caution" because it's a warning flag that duty is being evaded.
She acknowledged the case took a long time, saying there were "complex and unusual arrangements between Zespri and their Chinese importers".
In a statement, Zespri said it was pleased the Serious Fraud Office (SFO )had publicly confirmed the end of its investigation.
Zespri chairman Peter McBride said the investigation, had cost the kiwifruit marketer $7m.
"As we have always been clear, we relied on our former importers to comply with their legal obligations under local customs laws and, based on our own internal investigations, we know that we did not benefit from their customs fraud," he said.
"It is satisfying to finally have the SFO confirm that its investigation of Zespri has closed and that there are no further actions."
Publication date: 11/7/2017
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