In a Europe-wide coordinated operation led by the European Public Prosecutor’s Office (EPPO) in Munich and Cologne, there were 130 searches in 17 countries, including Austria, at the beginning of April, the Finance Ministry reported on Friday.
14 people were arrested. There are also two Austrians among the accused. They are currently at large, but one was temporarily arrested during the operation, the ministry said in response to an APA request. In Austria there were searches and seizures by tax investigators with around 55 emergency services at seven addresses. Almost 200,000 euros in cash, numerous valuables, 166 iPhones in their original packaging worth around 200,000 euros and 45 other smartphones were confiscated. In addition, extensive evidence such as paper documents and data carriers was seized.
On a skiing holiday in Austria
Because of a European arrest warrant, a German citizen who is listed as a suspect in these proceedings in his home country but was on a skiing holiday in Austria was arrested through legal assistance. He is now in custody for extradition, the Finance Ministry said.
“The fight once morest cross-border duty and tax fraud only works through well-coordinated international cooperation. Thanks to the meticulous preparation and decisive action of all units involved, a massive case of fraud was uncovered and the criminal activities were brought to an end,” summarized Finance Minister Magnus Brunner (ÖVP).
Around 680 investigators were deployed across Europe at the same time to secure evidence and make arrests in a total of 130 searches. The background is a suspected VAT carousel fraud by a German conduit company. This is a complex criminal scheme that exploits EU rules on cross-border transactions between Member States, as these are exempt from VAT.
The fraudsters may also have taken advantage of the corona pandemic
The accused company is believed to have carried out various VAT frauds related to the trade of small electronic goods, including smartphones, since 2017. The suspects are believed to have used fraudulent chains of traders who disappeared without meeting their tax obligations, according to the Treasury Department.
The fraudsters are also likely to have taken advantage of the corona pandemic: from 2020, the suspects entered the market for protective masks. However, there was no trade in protective masks among companies in Austria, according to the Ministry of Finance. The European Public Prosecutor’s Office suspects that the suspected criminal organization behind the identified VAT frauds has created a series of shell companies, front men, fictitious identities and secret communication channels to conceal their criminal activities.
