The Economic Democracy Union yesterday called for an investigation into reports of alleged bogus transactions and money laundering by e-commerce platform Shopee that has led to accusations it helped China channel funds into Taiwan to support pro-China political parties and politicians.
There are many accusations that Shopee and its partners have allowed Chinese state-directed operations to meddle in Taiwanese politics in the run-up to next year’s presidential election, Economic Democracy Union researcher Lo Tzu-wei (羅子維) told a news conference.
The Ministry of Digital Affairs and the Ministry of Justice should crack down on illegal activities, and monitor “unusual product sales and bogus transactions” and “concealed money flows” detected on Shopee’s Web site, Lo said.
Photo: Reuters
“Prosecutors have uncovered money laundering and illegal transmittance between Shopee sellers and buyers,” he said. “This is probably how China channels funds into Taiwan to make illegal political donations.”
The money from China and other overseas sources has financed pro-China parties and their candidates, funded vote-buying operations, paid for adverts and campaign worker wages, and been used to buy media firms and hire Internet celebrities to generate disinformation to undermine the government, he said.
In one case, a couple in Taiwan set up a shop to sell products and “conduct workshops to teach about online payments and stored value services,” but investigators discovered that they were remitting money between Taiwan and China illegally via yuan deposits to accounts at Chinese state banks, Lo said.
Prosecutors indicted the couple for contraventions of the Banking Act (銀行法) and the Money Laundering Control Act (洗錢防制法), while people filed complaints about the couple selling fake luxury-brand bags, Lo said.
He and other researchers this week found 2,900 criminal investigations and cases involving Shopee in a search on the Judicial Yuan database, Lo said.
The Shilin District Court last year ruled against the firm in a criminal trial, he said.
“It was just one case, but it shows that criminals have Shopee accounts that they use to remit money from fraud operations,” he said. “Shopee has become a favorite platforms for fraudsters and scammers.”
Shopee Taiwan Co is a subsidiary of Singapore-based Sea Ltd, founded by Singaporean businessman Forrest Li (李小冬).
Shopee Taiwan is backed by Chinese capital, with China’s tech giant Tencent Holdings Ltd holding a 39.7 percent stake when the Taiwan subsidiary was registered in 2015, although it reduced its stake to 18.7 percent last year, Lo said.
Economic Democracy Union researcher Ou Hsu-shao (歐栩韶) said that Shopee’s operations are based on the “customer-to-customer” model, which enables account-holders to set up “unusual product sales and bogus transactions.”
Investigations have uncovered numerous illegal activities, including money laundering, illicit remittance, illegal third-party payment services, false pricing to facilitate tax evasion and yuan-denominated transactions, Ou said.
Shopee Taiwan in a statement said that it strictly forbids illegal transactions and currency exchanges.
It has reported illegal online sales that have breached financial regulations and it is cooperating with authorities to clamp down on other illegal activity, it said.
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