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Chinese Shell Corporations Evade Taxes in Ecuador :: Dialogo Americas

At least seven Chinese companies the Ecuadorean government hired for public works projects in the construction, mining, telecommunications, and oil exploitation sectors made payments to companies the Ecuadorean Internal Revenue Service (SRI, in Spanish) considers shell corporations. According to Jorge Rodríguez, an Ecuadorean economist and a representative of the country’s National Anti-corruption Commission, the use of shell corporations is long-standing in Ecuador. He said these companies are usually hired to launder money, simulate expenses, artificially lower their earnings, and pay kickbacks to authorities for acts of corruption. “The problem started in the 1990s, when banks tried to move the sucre and the dollar, so businessmen built shell corporations in the names of their drivers or assistants to launder cash and gain advantages over the exchange rates.

First found on: dialogo-americas.com