According to new.qq.com, on August 9, a medical beauty company in Hangzhou was fined more than $13 million for tax evasion, according to a Weibo hot search.

The company’s branches use personal bank accounts to collect service payments and conceal more than $70 million of income unaccounted for in financial statements.

As soon as the news came out, netizens expressed their astonishment. Does medical beauty make so much profit?

Hidden income of $70 million, and tax evasion of $22 million

According to the “Credit China” website, Hangzhou Gaming Culture and Art Planning Co., Ltd. recently incurred an extra administrative penalty. 

From January 2017 to November 2021, Qianhe Medical Beauty Clinic, a company branch, provided customers with medical beauty project services. 

However, it used personal bank accounts to collect service fees and hide income exceeding $70 million, which was not included in the financial account.

During this period, the company generated interest income of approximately $4.3 million through the hidden money in the account. 

The Hangzhou Municipal Bureau of Finance (Hangzhou Local Taxation Bureau) investigated the company’s concealment of income and underpayment of tax. 

It imposed a 60% fine on the underpayment of corporate income tax of approximately $22 million, so the total penalty was roughly $13 million.

According to Qixinbao, Hangzhou Gaming Culture, and Art Planning Co., Ltd. was established in July 2009 with a registered capital of $740,000. The legal representative is Du Jungang, and the actual controller is Yu Wenhong. The business scope includes brand management, medical beauty services, etc.

According to the Yu Meiren International Group website, Yu Wenhong is the chairman of Hong Kong Yu Meiren International Group. In 1993, Yu Wenhong founded Yu Meiren image design studio. In 2004, she established Hong Kong Yumeiren International Group Co., Ltd. in Hong Kong. In 2005, Yumeiren developed over 150 brand image cooperative stores in China. In February 2010, Qianhe Medical Beauty Clinic by West Lake in Hangzhou was established.

According to the website, Yumeiren has developed into a comprehensive group integrating five-star international medical beauty clinics, brand image operation centers, hospital management, health management, and cultural and art planning.

Once exposed by CCTV “Focus Interview

On the Yumeiren International Group website, Yu Wenhong is called the “President.” In addition, she controls labels such as “Founder of Art Face Sculpture,” “Vice Chairman of the Yumei Relief Special Fund,” “Zhejiang Provincial Enterprise Confederation,” Zhejiang Entrepreneurs Association,” “Executive Director of the 7th Council of Zhejiang Federation of Industrial Economics,” etc.

It is worth noting that as early as May 25, 2011, CCTV Focus Interview had exposed Yu Wenhong and Qianhe Medical Beauty Clinic with the program “The True Face of Facial Sculptor.” 

Yu Wenhong, the founder of the Yu Beauty Group, claimed to be a “master facial sculptor” and personally participated in plastic surgery work and charged high fees. However, redness and swelling of the nose and other sequelae were the results for consumers who participated in nose repair surgery. The reporter found that she was not qualified to engage in medical beauty-related behavior. 

In addition, Qianhe Medical Beauty Clinic is different from general beauty medical institutions and only accepts customers referred by marketers.

In August 2013, Zhejiang Economic Television’s “Consumer Visibility” program also reported on Qianhe Medical Beauty Clinic and Yu Beauty. At that time, a consultant who claimed to be from Yumei International Group recommended the porcelain doll skin-beautification project. The reporter asked if the doctor who operated the porcelain doll skin-beautification project had relevant qualifications. For this, the consultant’s answer is ambiguous. Not only did they refuse to show the relevant doctor’s qualification certificates, but the consultants refused even to show the doctor’s photo and even refused to disclose the relevant information of the attending doctor.

In July 2021, Yu Beauty International Group’s public WeChat, “Beauty Says,” published an article, “Into Yu Wenhong: My face is the credit of our business,” in which Yu Wenhong responded to a previous Focus Interview report.

Yu Wenhong said that she was wronged. “At that time, many people in this industry were jealous of me, and people in the whole industry sent me to focus interviews.”

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