American Candy Stores... What's the scam?

[YummySweeties]

I keep seeing these places on my high street, and in the news!

The news is implying that these stores are some kind of tax scam, but how? Surely their costs (running a high street shop) must be huge?

Phone case shops, tiny protein powder shops, nail salons with barely any customers etc can be similar. You know those teeny independent shops dotted around where you see literally zero customers in? Same thing.

At least they're paying taxes on all this dirty money though. Same can't be said for a lot of the legit massive businesses.

Actual branded stores such as L'occitane will not be a front for money laundering. It's not the same thing at all.

Unless you're joking, of course. 😉

No. The single vape shop there lasted about 6 months. People in Wells are too posh to vape.

But it's still enabling money laundering and the criminal activity behind it to continue on a major scale. In the grand scheme of things the relatively limited benefit to the public purse is set against a potentially more harmful impact on society.

Those calendar shops that pop up around October and close in the new year are another one.

I’m not unconvinced about the ice cream parlours - I live in Leeds not a seaside resort and can’t believe they make a profit. And chai/bubble tea shops seem to be up and coming too

No, it isn’t just money laundering. People will reply saying "it doesn't make sense unless they're laundering", but it actually does if you look into it further.

The thing is that even though the candy
business doesn't make a lot of money, these guys have no costs beyond electricity and buying the produce, which is cheap, especially if it’s counterfeit. They don't pay rent, because the landlords let to them for free so the landlords don't have to pay business rates on an empty property. If the landlords reduced the long-term rent to attract real tenants, they'd have to cut the value of their property on the books dramatically, which they're loathe to do. Then the tenants fold before they have to pay business rates. So nobody pays rates, hence the tax evasion.

If the landlord is struggling to find a tenant, it will even rent the property to itself for the same scheme to avoid paying rates on an empty property.

The stores are also staffed with foreign workers who are very possibly paid well below minimum wage, so that too is another expense saved.

There are lots of empty properties on the high street now, and landlords only get business rates relief for 3 months only, hence why these shops are popping up everywhere. It’s probably one of the cheapest businesses to run.

Okay but I’m throwing in the money laundering ring our relatively small town’s ‘fine art’ stores… at least four and I have never seen a single customer. Big stores too. I’ve been saying they must be fronts for money laundering for years. One of which is a chain.

Oh I don’t doubt that some of these shops are probably engaged in money laundering, but not every shop will be.

Westminster Council is actually investigating for business rates evasion.

www.standard.co.uk/news/london/london-news-american-candy-shops-oxford-street-council-tax-business-rates-b1005515.html?amp

Audits by whom? No is going round checking these businesses

It's maybe difficult for law abiding people to understand how easy it is for criminals who don't care to get away with this type of thing

TikTok told me they’re something to do with the opium trade and the Taliban - wouldn’t be shocked!

Sorry if I'm being thick! But if they "claim" to have sold 1000 boxes of m&ms, surely there would be traceability of those 1000 boxes being purchased by them to sell on? If these m&ms didn't exist in the first place yet they put through the books that's what they've sold, how would they get away with this? Surely any investigation would see either receipts for the wholesale purchase of 1000 m&ms by them to sell or.. 1000 boxes of physical boxes of m&ms..

Sorry I'm not very good at understanding this sort of thing!

The m&ms likely exist, some will
genuinely be sold for £5 each, the rest will be put through the till as cash purchases.

American candy IS profitable though.

and bear in mind they have to get hold of stock with dirty money...so candy is an easier option.

the other thing I think is gyms. Not the brands but some of the ones that are popping up in my area - which is really horrible, I nearly posted about it yesterday - they're dodgy as hell.

The M&Ms do exist - there's numerous ways it could work.

Either by simply disposing of the product without selling it, but putting sales through the till

Or by selling the product and putting a higher price through the till for it than the money you are taking for it

I hadn’t heard about scams, but if anything they discover helps to shut down the hideous pink monstrosity in my town centre, I hope the shop has been hard at it with money-laundering and whatever else is Up To No Good.

The dodgy one near us is a hairdresser. That’s dead easy to fake customers. Same with nail bars. If I was going to money launder I’d choose a service industry so I didn’t have any actual products to deal with.

Buy 1000 boxes of sweets at cash and carry. Put 100 boxes in ten shops, each of the ten shops use the same scanned receipt to say they bought 1000 boxes and then put the 100 boxes through the till 10x each as sales.

Oh I see! So saying they sold 1000 boxes @ £5 each, so they've made £5k. But actually they've sold them @ £2.50, so have made 2.5 k, giving them the other 2.5 k to absorb something dodgy into the business takings!

Tanning booths used to be good for laundering. Have 5 booths, always mark 3 as out of order to customers but do the books as of all 5 in use all day.

How does the money laundering part come in? Give the dodgy monet out as change?

Weve got a few restaurants and nail bars near us where you rarely see a customer and I always think they must be doing something similar. There is a family that have a golf club where no one ever plays golf and there's new super cars parked outside every week. They're allegedly county lines drug dealers.

I always wonder why so my fish and shops are still cash only? 🤔 Could there be dodgy dealings going on the local chippys! 😁

This is why you find weed factories located near to areas with lots of nail bars or barbers. It’s a non quantifiable thing being sold usually.

Be careful op because there are stores that sell American candy and may well be a front but there is also a brand called American Candy which are, as far as I’m aware, legitimate.

I can't see how a gym, golf club or furniture store would be money laundering. Surely it has to be a business where you can plausibly claim that a lot of people are paying cash?