Chinese actress Fan Bingbing has been fined for tax evasion, state media reported Wednesday, the first public pronouncement about the star since she mysteriously disappeared from public view in June.
According to state-run news agency Xinhua, Fan has been ordered to pay almost $130 million, after she misreported how much money she had received for certain film projects, using so-called "yin-yang contracts" to conceal from the authorities her true remuneration and avoid millions of dollars in taxes.
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Fan and companies related to her were ordered to pay around $42 million in late taxes and fees, along with a fine of $86 million. Because she was a first-time offender, the government said criminal charges would not be filed against her if she pays all the money by an undisclosed deadline, Xinhua reported.
Fan's disappearance from public view sparked widespread speculation she had been detained by the authorities. Xinhua said she had been under investigation by tax authorities in Jiangsu province, near Shanghai but didn't provide any details on her current whereabouts.
In a letter posted on social media, Fan, 37, apologized profusely and repeatedly to the public and government.
"As a public figure, I should have abided by laws and regulations, and been a role model in the industry and society," she said. "I shouldn't have lost self-restraint or become lax in managing (my companies), which led to the violation of laws, in the name of economic interests."
Fan admitted to signing the contracts and said she "completely accepts" the decision by tax authorities.
"Without the favorable polices of the Communist Party and state, without the love of the people, there would have been no Fan Bingbing," she added.
Her case was clearly designed as a warning to other high profile celebrities, with the State Administration of Taxation saying it had launched a campaign to recover all back taxes in the entertainment industry.
Those who do not meet a December 31 deadline could face criminal charges, the authority said.
Fan has not been seen since June, a month after Cui Yongyuan, a former presenter for state-broadcaster CCTV, accused her of large-scale tax evasion.
The disappearance of one of China's most famous and most bankable stars shocked many in the entertainment industry, which had previously largely avoided Chinese President Xi Jinping's ongoing anti-corruption crackdown.
Under the National Supervision Commission, created in 2018, sweeping investigatory powers which had previously applied only to members of the ruling Communist Party were expanded to cover broad swaths of Chinese society.
"That China feels so emboldened to disappear even one of its most famous actresses ... should be a real wake up call that anyone within China could be next," human rights advocate Michael Caster wrote for CNN last month.
"Yin-yang contracts" are considered a form of tax evasion where the first, smaller contract is reported to authorities while the second, larger one is treated as tax-free income.
According to Xinhua, the investigation of Fan was sparked by her reporting of income from "Air Strike," an upcoming Chinese film starring Liu Ye and Bruce Willis about the Japanese bombings of Chongqing during World War II.
Separately from Fan, officials said her agent, Mou Enguang, obstructed the investigation, and ordered employees of companies owned by Fan and himself to conceal or destroy accounting evidence. Mou is now being detained by police as the investigation of his case continues.
Officials at several local tax bureaus in Jiangsu have also been held responsible for Fan's tax evasion.
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