India seizes $725M worth of Xiaomi unit’s assets for illegal money transfers

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India’s anti-money laundering agency said on Saturday that it had seized about $725 million worth of assets from Xiaomi India for violating the country’s currency laws, dealing a major blow to the Chinese phone maker that controls the Indian smartphone market.

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The Indian Enforcement Authority said it seized Xiaomi India’s bank accounts after discovering that the company transferred $725 million to three foreign entities “under the guise of royalties.”

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“Such huge amounts as royalties were transferred at the behest of their Chinese parent groups,” the report said. The agency added that the amount transferred to “two other unrelated entities in the US” was also for the “ultimate benefit of the Xiaomi group companies.”

The agency, which has been investigating Xiaomi for months, said the Chinese firm “provided misleading information to banks when transferring money overseas.”

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Xiaomi, which has yet to comment, had a 23% share of the smartphone market in India in the quarter ending March this year, according to research firm Counterpoint.

In recent years, the company’s popularity has plummeted following India’s ban on Chinese apps for national security reasons. In terms of optics, last year Xiaomi rebranded several of its stores in India with “Made in India” banners to distance itself from its Chinese brand.


Credit: techcrunch.com /

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