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Trade ministry proposes criminal investigation against Khaisilk

Wednesday,  Dec 13,2017,19:33 (GMT+7)
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Trade ministry proposes criminal investigation against Khaisilk

HCMC – The Ministry of Industry and Trade has just requested the Ministry of Public Security to launch a criminal investigation into Khai Duc Co Ltd, known for Khaisilk brand, as there are multiple signs of law violations at the company.

Having concluded an interdisciplinary inspection into the company on Monday, the ministry on December 12 proposed a criminal probe be launched following preliminary findings of the company’s offenses such as illicit trade, production of counterfeit and prohibited products, and infringement of consumer rights.

The inspection team consisted of representatives of the ministries of industry-trade, finance, science-technology, public security, market surveillance forces of Hanoi and HCMC, the Vietnam Textile and Apparel Association, and the Vietnam Standards and Consumer Protection Association. The inspection was launched after complaints that Khaisilk sold Chinese silk scarves disguised as made-in-Vietnam products.

Though the company is active in a range of fields, the inspection focused on activities concerning production, outsourcing, export, import and purchase of fashion products, Dan Tri reports.

In particular, since 2012 Khai Duc had not carried out production and outsourcing activities at local production facilities. It mainly purchased finished products at shops and enterprises and sold them under the brands of “Khaisilk®”, “Khaisilk cach dieu” and “Khaisilk Made in Vietnam.”

A quality inspection showed that some certain products at the company contain no silk at all, while their labels indicate they are 100% silk, according to the ministry’s inspection.

The company was also found to violate regulations on tax and invoice management. Some invoices were not issued and managed by tax authorities, others did not write the correct names of products, and there were differences between accounting records and actual data at one branch. The company also failed to explain and present invoices for such products.

In addition, there were violations in terms of product labels at Khai Duc. Some products did not have labels, and some labels did not have as enough information as required by the Government’s Decree 89/2006/ND-CP and Decree 43/2017/ND-CP.

According to the ministry’s inspection results, the company concealed information or provided inaccurate information for consumers, and sold products with unclear origin together with products made in Vietnam without letting consumers know about origins and ingredients of such products.

Based on the inspection results, the ministry told competent authorities to send the case to investigative police for an investigation into possible criminal violations.

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