“Breaking: Exposé on Saigon Jewelry Company’s Misdeeds”

The State Bank Inspectorate has just announced the inspection results regarding the compliance with policies and laws in the gold trading activities of Saigon Jewelry Company Limited (SJC).

According to the inspection conclusions, SJC has certain shortcomings and violations regarding compliance with policies and laws in gold trading activities.

Specifically, SJC violated the regulations on reporting the trading activities of buying and selling gold bars and showed signs of providing misleading information about their products to attract customers from other enterprises, relating to unfair competition practices.

Customer verification revealed signs of SJC violating tax laws. Based on legal provisions, the State Bank has forwarded the information to competent authorities for consideration and handling as prescribed.

Notably, the State Bank Inspectorate concluded that although there was no basis to determine that the price increase during the period from October 2, 2023, to April 15, 2024, was unreasonable, the buying and selling prices of gold at SJC were decided and directly instructed by the General Director of the company. This occurred without any internal regulations or procedures regarding specific indicators and bases in the mechanism for determining gold prices and without delineating the responsibilities of related departments in the process of advising on price determination.

The inspection conclusions clearly stated that the decision on gold buying and selling prices by a single individual, the General Director, without specific indicators and bases, led to risks in price determination, affecting the operations of SJC as well as the gold market, given the company’s relatively large market share.

SJC also violated several provisions of the law on anti-money laundering. Specifically, the company issued internal regulations with incomplete content as prescribed; lacked a risk management system to identify foreign individual customers with political influence; and failed to report large-value transactions related to gold trading activities.

SJC has not collected sufficient documents and data to verify the identification information of organizational customers; the measures corresponding to the risk levels of money laundering were not fully prescribed as regulated; the time limit for applying transaction delay measures was not prescribed; and there were no guidelines on how to communicate with customers performing suspicious transactions as required.

In addition, SJC violated the regulations on establishing or replacing and issuing a number of sales invoices without the tax code of the tax authority; failed to perform incorrect invoice handling procedures for a number of invoices; and recorded the provision for inventory devaluation into the cost of goods sold, leading to under-declaration of corporate income tax, reducing SJC’s corporate income tax. The company also failed to fully record or accurately record the identity card/citizen identification card information of some customers.

Immediately upon the completion of the on-site inspection, the State Bank forwarded the information about violations of accounting, invoice, and tax regulations with signs of criminal offenses at SJC to the Ministry of Public Security for verification, investigation, and handling.

The State Bank Inspectorate requested that SJC rectify its non-compliance with the laws and regulations on gold trading activities and address the violations and shortcomings.

“SJC is requested to strictly comply with tax laws and promptly remedy and rectify the violations and shortcomings,” the State Bank Inspectorate emphasized.

Previously, the Ministry of Public Security announced that six people were prosecuted in the case that occurred at SJC, including the director, two branch directors, a branch accountant, and two leaders of the gold workshop.