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Forensic experts to fight tax evasion

The National Tax Service will launch a forensic investigation center Tuesday to fight increasingly sophisticated tax evasion.

The Forensic & Anti Tax Evasion Center will be headquartered in Seoul with regional teams working in the agency’s Daejeon, Gwangju, Daegu and Busan offices. Each team will have about 30 officials.

“There are limits to the probe with our traditional enforcement tools as tax offenders are using ever-more innovative methods to conceal their wealth,” Kwon Do-keun, chief of the taskforce told reporters.

“The FAC plans to put the best cyber forensic practices in place.”

The new center will play a key role in its efforts to uproot offshore tax evasion and increase sources of tax revenue. The agency issued fines totaling 2.77 trillion won ($2.49 billion) this year, following more than 18,300 examinations of individuals and businesses trying to evade taxes. The goal is to increase the figure to one trillion won.

Some popular means of avoiding taxes include establishing paper companies abroad and using them to transfer export earnings to hide corporate assets. The agency said it has been detecting tax evasion activities from online trades and social commerce websites.

“The expert group will be comprised of certified financial planners, e-trade managers and market analysts who will constantly monitor fund outflows in the financial market,” an agency spokesperson said.

The cyber forensic practices will include analyzing and archiving digital data flow, the document states.

Starting in March, the agency will send more than 15 of its agents to the world’s financial centers, including Hong Kong and Shanghai to gather information on tax evasion.

It is currently investigation a number of corporations, including Dongkuk Steel, the country’s biggest steelmaker, on alleged offshore tax evasion.

“We’re expecting some solid achievements in catching tax offenders in the latter half of the year with the launch of the Report of Foreign Bank and Financial Accounts, and our forensic investigation team in place,” a high ranking NTS official said.

From June onwards, the NTS shall enforce businesses and individuals to report all foreign bank accounts with more than 1 billion won to the agency.

By Cynthia J. Kim (cynthiak@heraldcorp.com)
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