No transactions, yet tax invoices worth 10.6 billion won... An AI firm's suspicious books [True Story]

[Financial News] In September 2023, at a company office in Mapo District, Seoul, a tax invoice listing a supply value of 350 million won was issued to a business partner despite no goods being delivered or services provided. There was no actual transaction, but on paper, a deal worth hundreds of millions of won took place in an instant.
The issuance of such tax invoices did not stop after one instance. The company issued invoices as if it had supplied goods or services to other businesses and, conversely, accepted invoices for goods or services it had not received from business partners.
A, the CEO of a company providing services related to big data, the Internet of Things (IoT) and artificial intelligence (AI), issued false tax invoices to two companies on 13 occasions between September 20, 2023, and January 9, 2025. The invoices listed a total supply value of 5.362 billion won.
During the same period, A received tax invoices from five companies on 18 occasions, despite having received no goods or services from them. The invoices listed a supply value of 5,303,936,363 won. In total, 31 false tax invoices were issued and received, with a combined supply value of 10,665,936,363 won.
According to legal circles on the 27th, the 12th Criminal Division of the Seoul Western District Court, presided over by Judge Choi Jeong-in, sentenced A on August 10 to two years in prison, suspended for three years, for violating the Act on the Aggravated Punishment, etc. of Specific Crimes (including issuing false tax invoices) and the Punishment of Tax Evaders Act. The court suspended imposition of a fine of 1.1 billion won. It also fined Corporation B, which was tried alongside A, 30 million won.
The Seoul Regional Tax Office, which first uncovered the false tax invoices, referred the case to investigative authorities after conducting a tax-crime investigation. The National Tax Service filed complaints against A and the corporation over their exchange of tax invoices without actual transactions. Prosecutors charged A with violating the Act on the Aggravated Punishment, etc. of Specific Crimes, among other offenses, and Corporation B with violating the Punishment of Tax Evaders Act.
The court noted that the supply value of the false tax invoices exceeded 10 billion won and said, “These offenses involving the issuance and receipt of false tax invoices make it difficult for the state to exercise its legitimate right to collect taxes and undermine the proper order of commercial transactions, making them serious in nature.”
The court, however, considered it in A and the others’ favor that they admitted to the offenses and showed remorse, and that tax evasion did not appear to have been the main purpose of the crimes. It also took into account that all taxes had been paid after the case and that A was a first-time offender with no prior criminal record.


[email protected] Choi Seung-han Reporter