Consultant admits to submitting over $1 million in fake PIC claims

·Senior Reporter
Singapore’s State Courts. (FILE PHOTO: Dhany Osman/ Yahoo News Singapore)
Singapore’s State Courts. (FILE PHOTO: Dhany Osman/ Yahoo News Singapore)

A man claiming to be a consultant under the Productivity and Innovation Credit (PIC) scheme admitted to helping applicants submit fraudulent claims under the government scheme and managing to siphon more than $800,000 from the Inland Revenue of Singapore (IRAS).

S Chandran, a 37-year-old Singaporean, was the sole proprietor of Paradize Consultancy, which claimed to help firms submit PIC claims for government grants. He aided 49 applicants in submitting 58 bogus claims between June 2013 and July 2014. While the claims added up to $1,122,744 in cash payout and bonuses, only $876.684 was eventually paid out.

Despite initially claiming trial to the charges, Chandran decided to throw in the towel after five days of trial, which began in March this year. He pleaded guilty on Friday (23 November) to 18 counts of helping applicants unqualified for the PIC grants submit fraudulent claims, with the remaining 40 counts of a similar nature to be taken into consideration for when he is sentenced in January next year.

Claiming to provide services to help applicants

Under the PIC scheme, which was introduced in Budget 2010, local businesses can get cash payouts or tax deductions or allowances. This is meant to encourages businesses to invest in productivity and innovation.

Acting as a PIC consultant, Chandran would advertise his firm’s services through newspapers, the firm’s website, social media and word of mouth.

He claimed to provide services that helped applicants in their applications for the PIC cash payouts. These include staff training, setting up a website and creating a mobile app. Although these services were allegedly valued at $16,010, Chandran said he could provide them for free, and that applicants would only have to pay if their PIC claims were approved.

He also told applicants that if the payouts were successful, half of their claimed sum would be paid to him.

Ultimately, successful applicants did not receive the services Chandran claimed to provide.

Applications submitted despite requirements not met

Had the applicants engaged his firm’s services, Chandran would submit several documents on their behalf to IRAS. He made the applications despite knowing that some of the applicants did not meet the requirements for the PIC scheme.

These requirements include having a business, and the firm incurring expenditure that is related to the company’s business. The firm must also employ and make contribution to the Central Provident Fund of at least three local employees.

However, some of Chandran’s applicants did not even have a registered business entity, while others did not have employees under them. In such cases, Chandran would help applicants register a business or direct the applicants to obtain the name and NRIC numbers of three persons to list as employees.

Wife complicit in offence

One of these applicants was Chandran’s own wife, A K Sahtyah, 30, who was the sole proprietor of Carnival Munchies. Sometime in 2014, Chandran persuaded his wife to claim money from IRAS under the PIC scheme, even though her company did not qualify.

Chandran helped Sahtyah to falsely declare that her firm’s incurred expenditure of $5,010 for items bought for an event, even though there was no such purchase. As a result, Sahtyah received $8,016 of PIC cash payout.

His wife, who was complicit in the offence, has not been dealt with.

Of all the charges that Chandran has pleaded guilty to, seven of the applicants have been handed fines and five-digit financial penalties, while 10 others – including Chandran’s wife – have not been dealt with by the State Courts.

Chandran will be sentenced on 11 January next year.

For each of the charges, he faces a jail term of up to five years and/or a maximum fine of $50,000.

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