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Coverup cases up 64 percent

There has been a huge rise in the number of complaints received by the Ministry of Commerce and Industry with regard to coverup businesses (tasattur) in recent months.

The ministry headquarters and its branch offices across the Kingdom have received 503 complaints during the first quarter of 2012. This figure is an increase of 64.6 percent compared to the same period last year and a 41.8 percent increase against the last quarter of 2011, Al-Madinah newspaper reported.

Well-informed sources at the ministry told the newspaper that more than half a billion riyals earned from tasattur have been deposited in the bank accounts of foreigners in the first quarter of the year.

According to the sources, the number of tasattur cases referred to the Bureau of Investigation and Prosecution in line with the provisions of the anti-coverup law reached 93 (18.6 percent) while another 99 cases (19.8 percent) were withheld for want of evidence. As for the remaining 308 complaints (61.6 percent), they are still under the scrutiny of the authorities concerned.

These complaints were referred to the ministry either by citizens or foreigners or the government agencies concerned. Some of these cases were spotted during inspection raids by anti-coverup squads.

The sources noted the anti-coverup department at the ministry's branch in Madinah received the maximum number of complaints (95) and it was followed by the department in Riyadh (64), Hail (48), Turaif, Tabarjal, Afif, Onaiza and Al-Rass.

Egyptians top the list of foreigners who engaged in tasattur (20 percent) and Indians come second (18 percent). They were followed by Yemenis (15.8 percent) and Syrians (10 percent). Nationals from Sudan, Palestine, Lebanon, Jordan, Turkey, Pakistan, Indonesia, China, Afghanistan and Ethiopia follow.

The majority of tasattur businesses take place in the contracting sector (57.2 percent), followed by sales of consumer goods (17.5 percent), general trade (13.8 percent), foodstuff (4.6 percent) and other areas (6.9 percent).

Tasattur enables a foreigner to invest in businesses that remain outside the purview of the Foreign Investment Law and helps them get away without paying taxes to the government. Under this illegal practice, a Saudi allows a foreign worker to use his/her name and commercial registration to engage in various businesses.

Abdullah Al-Anazi, director general of the department fighting tasattur at the ministry, recently disclosed foreigners involved in coverup businesses transfer more than SR140 billion to their countries annually. He said the transfer of such a large amount of money would affect the Kingdom's liquidity causing major economic losses.

Such ventures also threaten the businesses of Saudis. He also disclosed plans to launch a major nationwide campaign against tasattur by the end of this year in light of the negative impact of this illegal practice on the Kingdom's economy and society.

© Arab News 2012

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