Chinese Withholding Tax
We have received details of another share scam. This time it is being perpetrated by two organisations which are presented as separate, but are part of the same scam team.
We could have called this article Fortress Corporate Escrow Services, or Global Registration and Transfer Corporation, because those are the fake companies involved in this scam, but it is more important to draw attention to ‘Chinese Withholding Tax’ because this withholding tax ploy comes up repeatedly in fake share scams.
Fake share scams are based around an ‘off market, pre-launch offer’ for investors to acquire shares in well known companies at bargain prices. The story is usually that the share price is going to rocket once news gets out or once the company floats, but investors can get in quick and make a killing. The only people making a killing are the scammers.
We have seen shares offered in Alipay, Tesla, Google, Spotify and other big name brands. The sale is often confirmed by sending the investor an elaborate fake share certificate so that they believe they genuinely own shares in these companies. The truth is that they don’t own any shares and their money has been stolen. The perpetrators of these kinds of share scams are often based in Hong Kong and China, but not exclusively. Some are based in Dubai and Eastern Europe. They use money mule bank accounts in the countries in which the investor is based because they know the investor might smell a rat if they have to send money to a bank account in Ukraine or Hong Kong.
However, the scam does not end there. Phase two is when they contact the investor again to give them the news that their non-existent shares have been sold for a very large profit. The only snag is that they tell the investor he/she cannot receive the money until he/she has paid the Chinese Withholding Tax. We are regularly contacted by people who have paid the tax and are surprised when they don’t receive their “profits”. Quite often the scammers will go back to the well a third time and say that there is another fee to pay which they forgot to tell the investor about.
The Chinese Withholding Tax scam always carries a statement from the scammers that the tax cannot be deducted from the profits. That is generally an investor’s first response i.e “if you are holding $250,000 for me please pay the tax out of the money you hold”. The scammers know that’s their weak spot but they cover that with some excuse as to why it can’t be paid out of the profits.
In this latest scam Fortress Escrow Corporate Services is the seller of the fake shares. Global Registration and Transfer Corporation is the company attempting to steal the alleged tax payment. The websites are remarkably similar which is not surprising considering it’s the same bunch of scammers.
One of the money mule bank accounts they are using is in the UK. Here are the details:
Lloyds Bank PLC
BIC/SWIFT : LOYDGB21118
IBAN : GB10LOYD30937647359660
The bottom line is that companies claiming to have sold shares at a large profit whilst asking for payment towards Chinese Withholding Tax are scams.
We have reason to believe that the Fortress Escrow Corporate Services, and Global Registration and Transfer Corporation, share scam is linked to the Oakbrook Capital follow-on-fraud. We wrote an article on Oakbrook Capital in November 2020. We contacted the UK Police and they acted very quickly to close down the bank account associated with that scam.