A Hotbed of Crime” Special Situation of Tax Evasion and Fraud in the Rapidly Growing Trading Card Industry

The trading card game industry is booming as a new hobby for the COVID-19 crisis, and a number of crimes have been reported.

On April 8, three Kobe City men and a sales company that resold trading cards such as “Yu-Gi-Oh!

The three men had made a profit from the sale of “original packs” containing multiple cards, but had failed to declare approximately 80 million yen in profits. It is also known that a sales company established by one of the three concealed approximately 20 million yen in income by manipulating the amount of sales and intentionally reducing profits. The Osaka Regional Taxation Bureau ordered the three individuals and one company to pay a total of approximately 25 million yen in additional taxes.

The trading card market was estimated to be worth 100 billion yen in 2006, but by 2010 it had grown rapidly to 210 billion yen. Crimes have also increased in line with the growth of the market. At the end of last year, the Tokyo Regional Taxation Bureau filed charges against a Tokyo-based sales company and its president for evading 45 million yen in corporate taxes.

In addition, there have been a number of problems in transactions between individuals. According to the National Consumer Affairs Center, the number of inquiries received at consumer affairs centers nationwide regarding trading cards increased approximately 1.5 times from FY 2008 to FY 2009. Crime journalist Taihei Ogawa points out that “the fast-growing field has the risk of becoming a breeding ground for new crimes.

Because of the high demand in the industry, there is a possibility that unscrupulous operators will continue to take advantage of it. The recent popularity of flea market apps has made it possible to make a profit from resale without owning a company. If it is difficult to be discovered, and if it is possible to make profits in the tens of millions of yen, the risk of crime will not disappear.

In addition to tax evasion, the number of victims of resale fraud is also increasing. Mr. Ogawa continues.

In online auctions and flea market apps, when an offer to buy comes in, the scammer sends an individual message to the buyer and asks for a direct transaction without going through the site or app. They offer a lower price than the posted price on the condition that they pay in advance, but as soon as the money is transferred, it seems that more and more cases are occurring where contact cannot be established. In addition, since most of the accounts used for transactions are accounts used for special fraud, it is difficult to investigate and extremely difficult to catch the culprits. Currently, there are no special rules or regulations for person-to-person transactions, but I believe that the police are planning to strengthen their crackdown on this type of crime. But first of all, it is important for individuals to take precautions, such as making sure the person they are dealing with is truly trustworthy.

In order to prevent new crimes from being committed, measures such as strengthening crackdowns are required.