Massive VAT Fraud Uncovered: €2.9 Billion Scheme Linked to Organized Crime Across Europe

• The European Public Prosecutor’s Office (EPPO) conducted a large-scale operation involving 624 law enforcement officers across 16 countries to address a major VAT fraud scheme.
• The investigation, known as Investigation Admiral, revealed a criminal syndicate linked to a VAT fraud scheme involving electronic goods, resulting in an estimated VAT loss of €297 million.
• Investigation Admiral, initiated in November 2022, is the largest VAT fraud case in the EU, with total damages estimated at €2.9 billion.
• The syndicate utilized a similar operational model and infrastructure as those involved in the Admiral investigation to execute a VAT carousel fraud, exploiting EU tax exemption rules for cross-border transactions.
• Suspects established companies in 15 EU Member States, selling over €1.48 billion worth of electronic devices online while failing to remit collected VAT to tax authorities.
• The fraudulent scheme involved companies disappearing to evade tax obligations, while others claimed VAT reimbursements, leading to significant financial losses.
• The EPPO suspects over 400 companies are involved in this scheme, which may also be linked to money laundering from drug trafficking, cybercrime, and investment fraud.
• Evidence suggests possible involvement of Russian organized crime networks, which may have provided financial support and influenced the syndicate’s operations.
• The recent operation included over 350 searches and resulted in the detention of 32 individuals in Estonia, Latvia, and Lithuania, with ongoing investigations supported by various law enforcement agencies.

Source: eppo.europa.eu

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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