Computer crime hits taxes

Date: August 11, 2004
Source: Computer Crime Research Center
By: Timofey Saytarly

The emergence of electronic money and of the global system for electronic payments has formed a parallel banking system with an entire network of semi-legal financial institutions. The unique opportunities of quickly shaped infrastructure at once drew attention of criminal groups. It allowed anyone to transfer monetary funds to any country rapidly, anonymously, through tangled routes and circumvent governmental systems of financial control. Heretofore, electronic transfers interested criminals as the efficient tool to conceal the sources of money intakes, to launder illegally earned money and to conceal their incomes to evade taxes.

Here's one of the criminal schemes of carrying out payment operations hardly tracked down by the law enforcement: upon receipt of a lot of goods, let's say drugs, the buyer electronically transfers money to the credit card of the supplier. The last at one stroke transfers this money through the system of electronic payments to his bank account in the country with
strong bank secrecy laws. Then the supplier can simply transfer his money to the card in parts and can easily use these money at his own discretion.

In Russia, one of the registered forms of computer crimes purposing to evade taxes is the use of computers to interfere with pool memory of electronic cashier sales registers installed at shops. In a result of such interference, registry of received payments is either modified or deleted. It allows hiding real incomes from tax administrations.

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