Saudi Arabia: Four men convicted of business licensing fraud named and shamed

Abu Dhabi: The Saudi Ministry of Commerce has named and shamed three Saudi citizens and a Pakistani after they were convicted of business licensing fraud, local media reported.

“The Saudis were found guilty of enabling the Pakistani resident to run a date business in Biraidah, in northcentral Saudi Arabia, through a trade licence registered in the name of the citizens, Mishaal Bin Ali Al Rashidid, Saleh Bin Mohammed Othman Al Eid, Abdul Rahman Bin Saleh Mohammed Al Towayan,” according to court records.

The ministry published on Saturday a summary of the judicial ruling issued by the Criminal Court, including a fine, closing the firm, liquidating its activities and revoking its license. The court ruling also cancelled the commercial register of the business, collecting zakat, fees and taxes.

The court also ordered deporting the Pakistani man, Mohammed Qassim Mohammed Hashim, after serving his term, not allowing him to return to the kingdom. The ministry has published nine court rulings over the past months in Al Qassim rgion.

Saudi Arabia has tightened penalties for business licensing fraud, also known as Tasattur or cover-ups, in which foreign nationals owning businesses in the kingdom, while using the names of Saudi citizens.

A new anti-business licensing fraud regime passed by the Saudi Cabinet, seeks to eliminate the shadow economy and includes tough penalties for offenders of up to 5 years in prison and a fine of up to SR5 million.

The Saudi Data and Artificial Intelligence Authority will build an index to measure the percentage of suspected cases of commercial cover-ups and keep updating the records based on the data it receives from the authorities.

The new anti-business fraud regime protects whistleblowers and rewards them up to 30 per cent of the fine collected after a final court ruling is issued.

The system stipulated proactive measures to prevent the occurrence of cover-up crimes to narrow the sources of this phenomenon by addressing the stages that preceded the crime, and punishments, the most important of which is the seizure and confiscation of the unlawful funds of the perpetrators.

The system enables the relevant government agencies to curb business licensing fraud or cover-up crimes, demanding that each entity that issues licenses to businesses follow up on them, and inform the Ministry of Commerce of any suspicious practices.

The new system authorises relevant entities to use technology to prove the crimes and violations of the commercial concealment through “electronic evidence” in addition to other methods of proof.

The system also allows commuting or exempting from penalties for those who report any fraudulent activities.