Companies registered in Cyprus are part of an ongoing probe led by the European Public Prosecutor’s Office (EPPO) into a €30 million VAT fraud and money-laundering scheme, it emerged on Thursday.
According to a statement issued by the EPPO, the investigation was initiated by its office in Athens.
“The investigation, which started after a report from the Hellenic Financial Intelligence Unit has revealed that the suspects created a complex web of companies in Greece and other EU Member States (Cyprus and Slovakia), in order to take advantage of EU rules on cross-border transactions between its Members States, as these are exempt from VAT.”
The EPPO said the companies in question traded small electronic goods through a fraudulent chain of so-called missing traders – shell companies established for the sole purpose of evading the payment of VAT.
Other companies participating in the fraudulent scheme would subsequently claim VAT reimbursements from the national tax authorities.
“In so doing, they are believed to have created estimated losses to the EU and Hellenic budgets of at least €30 million over the last five years.”
According to evidence gathered earlier this month, the criminal organisation used a large number of strawmen, who managed (or are still managing) at least 430 companies active in different economic sectors.
“Investigative measures were carried out in Cyprus and Slovakia, with the support of EPPO offices there, to receive and get access to information related to the companies based there,” the statement added.
In Greece, police carried out dozens of searches, arresting 21 persons and seizing ten luxury watches, a high number of mobile phones, a handgun, over €130 000 in cash and a large number of documents and external hard drives.
The EPPO is the independent public prosecution office of the European Union. It is responsible for investigating, prosecuting and bringing to judgment crimes against the financial interests of the EU.
