Ride-sharing giants Bolt and Uber implicated in alleged "ghost company" scam
In a shocking revelation, an investigation conducted by rbb has uncovered that at least 10 companies operating on ride-hailing platforms such as Uber, Bolt, and FreeNow are operating illegally. These so-called "ghost companies" are suspected of evading taxes, paying minimal or no accident insurance, and engaging in organized crime to defraud the state.
The investigation did not specify the exact number of vehicles or drivers involved in these illegal operations, but it is suggested that some companies are using this scam to defraud the state. The lack of a physical address for these companies is a violation of the legal requirements for their operation.
According to transport policy spokesperson Tino Schopf (SPD), these illegally operating companies are engaging in organized crime, creating fake firms to defraud the state. The companies in question are operating without a real address, which includes no office, break room, or parking spaces for vehicles.
The scam involves renting a headquarters temporarily to gain necessary approvals, then shutting them down to save costs while continuing to operate on the platforms. When visiting an alleged office of one of the registered companies, a statement was made: "Those are ghost companies. But don't name me, otherwise they'll set fire to my office."
Experts suggest that these ghost companies might be engaging in fraudulent activities such as false invoicing and shell companies, underreporting revenue, misclassification of workers, multiple driver use for the same job, exploitation of dynamic pricing and fare splitting, and a lack of transparency and regulatory oversight.
By manipulating the platforms’ transaction reporting systems, ghost companies may underreport earnings from ride services, thus paying less corporate tax or avoiding Value Added Tax (VAT). Treating drivers as independent contractors rather than employees allows these companies to avoid paying payroll taxes, social security contributions, and other employee-related taxes.
Reports mention scams like assigning the same ride to two different drivers, potentially complicating financial and tax reporting or enabling fictitious billing. While designed to balance demand and supply fairly, lack of transparency in dynamic pricing and fare splitting features could be exploited to inflate costs artificially, reducing reported profits or creating undisclosed revenue channels.
The digital nature and rapid growth of the gig economy mean that many transactions occur with limited state oversight, making it easier for ghost companies to obscure actual operations and evade taxes.
The specific tactics used by these ghost companies are still under investigation, but the potential impact on the state's finances and the safety of passengers and drivers cannot be overstated. The authorities are urged to take swift action to address this issue and ensure that all companies operating on ride-hailing platforms are compliant with the law.
The ghost companies operating within the ride-hailing industry are suspected of engaging in organized crime and fraudulent activities, such as underreporting earnings to evade taxes and using multiple drivers for the same job, which falls under the category of crime-and-justice and general-news. In a bid to save costs, these illegal firms have been renting headquarters temporarily, only to shut them down later, a practice that also violates business regulations.
