By Lycamobile, a mobile phone operator owned by Sri Lankan billionaire Subaskaran Allirajah, has been fined 10 million euros by a Paris court for money laundering and VAT fraud. The company’s former CEO, Christopher Tooley, was also sentenced to three years in prison and fined 250,000 euros for complicity in the VAT fraud.
According to the court, Lycamobile knowingly participated in a complex money laundering scheme between 2014 and 2016, which involved 17 million euros. The scheme involved a series of shell companies, two Lycamobile salespeople, and resellers in the Parisian district of La Chapelle. It operated for the benefit of construction companies demanding cash to illegally pay employees.
The court also found that Lycamobile had deceived the tax authorities by claiming VAT exemption on services that were not eligible. The company did this in order to be more competitive.
Lycamobile has said that it disagrees with the court’s decision and has appealed.
This is the second time in recent years that Lycamobile has been caught up in allegations of financial misconduct. In 2019, the company was fined £12 million by the UK’s Financial Conduct Authority for failing to prevent money laundering.
The latest case raises serious questions about Lycamobile’s corporate culture and its commitment to compliance. The company must do more to ensure that its operations are above board and that it is not being used to facilitate criminal activity.
