PIC Promoter will be charged in Court for role in PIC claims...

PIC Promoter will be charged in Court for role in PIC claims of over $1 million

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Press Release by IRAS – 26 Jan 2017

A sole-proprietor of a consultancy firm who allegedly acted as the ‘promoter’ of the Productivity and Innovation Credit (“PIC”) Scheme, will be charged in court on Friday, 27 Jan 2017. The alleged promoter will face 58 charges of assisting 49 claimants to fraudulently obtain PIC cash pay-outs and bonuses. The 58 charges involve PIC claims amounting to $1,097,694.

Over the past year, IRAS had conducted extensive investigations into a number of suspicious PIC claims. IRAS’ investigations revealed that many of the suspicious claims were linked to this PIC promoter. About 200 persons were called up to assist in IRAS’ investigations. IRAS will take enforcement actions against the claimants, where appropriate, once the investigations are completed.

PIC Promoters Abusing the PIC Scheme

The PIC scheme was introduced to encourage productivity and innovation activities in Singapore. It is meant for qualified businesses with real productivity-enhancing investments. Many promoters, however, seek out individuals not carrying out business to register companies and businesses purely to make false claims.

In a typical fraudulent PIC scam, the PIC promoter may assist claimants by providing false documentation to help support the expenditures declared in their PIC cash pay-out applications. Such documentation may include false employment contracts, working timesheets, payment vouchers, product flyers or brochures, quotations and invoices.

In addition, where the claimants do not fulfil the PIC application condition of three local employees, the PIC promoter would provide the names and particulars of up to three unrelated persons just for the purpose of falsely representing to IRAS that the claimants have met the prerequisite of three local employees. These false employees could include friends, relatives, retirees and unemployed persons. Some of these false employees might not have known that their names had been used for PIC claims.

In return for facilitating the false PIC claims, the PIC promoter will take a cut from the PIC cash pay-outs given to the claimants.

Please see Annex A for an illustration.

Severe Penalties for Abusing PIC Scheme

IRAS takes a serious view of any attempt by claimants, vendors or consultants to defraud the Government. In particular, IRAS will take stern action against promoters who facilitate illegal activities. Anyone who commits PIC offences with wilful intent might be subject to penalties of up to four times the amount of PIC cash payout and bonus fraudulently obtained (or which would have been obtained if the offence had not been detected), and a fine of up to $50,000 or imprisonment of up to five years.

Reporting of Malpractices

Businesses or individuals are encouraged to immediately report to IRAS any past or current malpractices or potential abuses of the PIC scheme. Reports can be made to:

Inland Revenue Authority of Singapore
Investigation & Forensics Division
55 Newton Road, Revenue House
Singapore 307987

Email: ifd@iras.gov.sg

Inland Revenue Authority of Singapore


Annex A

Illustration on PIC Promoter

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