A French memory company has claimed that a massive VAT fraud throughout Europe is costing nations millions of pounds and undermining the real price of memory.
David Haccoun, co-chairman of Dane-Elec, which also has offices in the UK and US, said individuals and even multinationals were issuing fake invoices which included VAT, then destroying them and reselling memory at a price as much as 20 per cent below the norm.
He said: "All European governments are aware of this problem which is a difficult one for the European community. The loss of tax in France alone amounts to 50 billion francs. There's a price in the market and we know what the cheapest price should be. People in France say they'll sell it outside the EU, get a VAT-free invoice and then sell it within the community."
Haccoun said although his company had alerted local customs officials in different European countries of the fraud, the lack of coordination between countries on policing meant it took a minimum of six months for bodies to begin investigation. With that gap in time, the crooks had already covered their tracks, he said.
In one case, Dane-Elec had sold a quantity of Dram Simms to a customer and some weeks later bought up the same consignment cheaper as memory prices fell, Haccoun said.
"We see our product being sold at below the price we sold at," he said. "We've even bought our own product back." He said that the loss to Dane-Elec amounted to around five per cent of its total turnover which stands at close to the $150 million mark. That meant he could not re-invest in stock and expand his company to that degree. Other products including cars, also suffered from the problem.
* Dane-Elec has opened a sales office in Irvine California.Adrian Proctor, formerly in the UK, will become general manager. He said that the company will compete more effectively with Centon, PNY and Kingston because of the move.
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