Million-euro fraud at Low Cost Hair Salons: owners and 32 franchisees arrested over irregular contracts
The owners of Low Cost Hair Salons and 32 franchisees were arrested on suspicion of fraud and fraudulent use of training contracts. Police estimate the fraud at four million euros.
Low Cost Hair Salons owners arrested over alleged four-million-euro fraud
According to lasexta.com, the owners of the Low Cost Hair Salons chain, David and Mar, along with 32 franchisees, were arrested on charges of fraud, falsification of documents and offences against workers' rights. The police investigation points to the irregular use of training contracts as the central mechanism of the alleged scheme.
According to investigators, ordinary workers performing regular functions were concealed under these contracts. The system would have allowed the company to avoid paying Social Security contributions whilst simultaneously accessing public grants and bonuses. Police put the total damage at around four million euros and maintain that a significant portion of that money went to the accounts of those responsible for the organisation.
The investigated franchisees deny any conscious involvement in the alleged scheme and claim to have been deceived by company management. Six of them recounted their version on the Equipo de Investigación programme, where they described the substantial debts accumulated with Social Security and the serious financial consequences they face as a result.
Several former franchisees also highlighted the striking change in lifestyle that, they claim, David and Mar experienced during those years. They claim the owners went from living in a small studio flat to occupying a villa valued at close to one million euros, driving high-end vehicles and posting on social media images of exclusive trips, golf outings and luxurious international getaways.
What was initially presented as a business opportunity within the low-cost hair salon sector resulted, according to the investigation, in a structure that would have defrauded both workers and the public purse.
Source: Google News ES — Crime (es)