8th September 2017
Colonel Sanders isn’t the only King of Chicken, Benin’s Sebastien Ajavon has his own claim to the throne, however he’s fallen fowl of the law according to reports stemming from the West African nation. But what has he been accused of and could this be the largest case of African tax evasion in history?
Benin doesn’t hit the headlines often. In fact, it’s probably best known for being the supposed birthplace of voodoo and being home to relatively obscure footballer, Stephane Sessegnon. Along with him, Ajavon is one of the biggest names in the country and even ran in the recent elections, although his claim obviously wasn’t successful.
He made his money in the food industry but also has interests in the transport and media sectors, owning the Sikka TV channel and radio station Soleil FM. Ajavon received almost a quarter of the vote in the first round of the election, meaning he finished third, but then threw his support behind eventual winner, Patrice Talon. This isn’t the first time that ‘the King’ has ruffled a few feathers. He was previously indicted in October last year after an 18kg shipment of cocaine (with a street value of $16m) was found in a container marked for one of his businesses. However, he was released after just eight days in detention and then argued that he had been the victim of a plot to undermine him and charges were eventually dropped.
However, this case may be more challenging to recover from. Again, Ajavon has argued that he is the victim of corruption, however the charges are significant and could result in a major fine and a lengthy prison sentence. “He has been accused of organising tax evasion through several of his companies in the years 2014, 2015 and 2016”, according to the Benin tax service. In total, Ajavon has been charged with conducting an elaborate tax evasion scheme and now owes a staggering $302m to the government. It’s such a remarkable sum that it accounts to more than 1% of the country’s overall domestic product and dramatically eclipses its per capita GDP of $2,200.
African tax evasion cases
This case highlights a few interesting points. Firstly, that the net really is closing in on individuals and organisations committing evasion around the world. It would be fair to say that Africa hasn’t always driven the highest compliance standards, but if a relatively small nation like Benin is tackling the problem, the future looks bright. The majority of African tax evasion cases usually stem from Nigeria and the Maghreb, however it’s highly encouraging that other less robust economies are now diverting resources to tackle the issue.
It also highlights that the market is now considerably tougher, even in nations like Benin which historically haven’t had the best track record when it comes to tackling non-compliance. And if a nationally renowned and widely loved figure like Ajavon is being prosecuted, then few if any organisations will be able to withstand prosecution. This case really highlights the increasingly strict market and should show firms that there are very few holes in the net. It remains to be seen whether Ajavon is hatching a plan to secure his freedom, but all indicators suggest that the government is closing in.
Don’t wing it
The Beninese market isn’t widely known and it’s highly unlikely that many recruiters will have specialists within their teams. That means if you’re placing talent in far-flung corners of the globe, then ensure you partner with the experts before it’s too late.
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