EPPO

The European Public Prosecutor’s Office (EPPO) in Rome (Italy) has charged nine individuals and five companies with aggravated fraud to obtain €4 million for the aquaculture sector, funded by the European Maritime and Fisheries Fund (EMFF). 

At issue are five cooperative societies, suspected of submitting false documentation and fictitious insurance policies, in order to obtain €4 million for the construction of new fish tanks and a fish boat for the aquaculture sector. During the application procedure, one of the companies was barred from receiving any funds, after it was sanctioned with an anti-mafia preventive measure. 

Four companies received an advance payment of €1.4 million from the EMFF. The beneficiaries informed the paying agency that the works on the new tanks had started, but later checks showed that this was not true.

An additional request for €2.6 million was submitted to the paying agency, but the funds were not disbursed, thanks to the timely investigation of the EPPO. 

The evidence gathered points to criminal responsibility of the suspects for aggravated fraud to obtain public funds, as well as embezzlement and money laundering. 

Overall, four of the five companies were affected by an anti-mafia preventive measure: one during the application procedure, for another investigation, and the remaining after this investigation started. 

The investigation counted on the support of the Italian Financial Police (Guardia di Finanza – Comando Provinciale Foggia) and with the cooperation of the local Port Authority. 

All persons concerned are presumed to be innocent until proven guilty in the competent Italian courts of law.

 In an investigation led by the European Public Prosecutor’s Office (EPPO) in Venice (Italy), three more suspects have been convicted of participation in a criminal organisation selling toner cartridges and office supplies at cheap prices, by systematically evading VAT. Prior to these convictions, four other suspects had also been found guilty in this investigation, code-named ‘Cheap Ink’, which uncovered a massive VAT carousel fraud, with profits estimated at €58 million.

The judges at the Court of Padua sentenced one of the suspects to nine years imprisonment, another one to four years and six months and the third to four years. This is a first court decision, still subject to appeal. The first four convictions have now become final.

The investigation uncovered a complex fraud scheme involving more than 100 suspects and a network of companies located mainly in Italy’s Triveneto region, but also in several other EU countries. The scheme, which used destitute people as ‘straw men’ for dozens of companies, allowed the suspects to import toners for professional printers and stationery into Italy, while systematically evading VAT. This also allowed the group to resell the imported products at extremely advantageous prices, distorting the principles of fair competition on the market.

This case, led by the EPPO since October 2021, included investigative measures conducted in Austria, Czechia, Germany, the Netherlands, Poland, Slovakia and the United Kingdom. The operational model of the EPPO as a single office made it possible to dismantle a complex cross-border criminal network and bring to trial its ringleaders expeditiously, by collecting evidence much more quickly and in a more comprehensive manner than under the previously existing judicial cooperation methods.

Earlier in this investigation, at the request of the EPPO, the Italian Financial Police (Nucleo di Polizia Economico-Finanziaria Bolzano – Guardia di Finanza) seized cash, real estate and luxury assets from 20 companies and 15 suspects, some of whom were subject to restrictive personal liberty measures or preventive measures. Trial is pending for other suspects in this investigation.

In an investigation led by the European Public Prosecutor’s Office (EPPO) in Milan and Palermo (Italy), code-named 'Moby Dick', detention orders are being executed against 43 suspects. The EPPO is probing a €520 million VAT fraud, with heavy involvement of several mafia groups. 

During today’s action, led by the EPPO, 160 searches are being carried out in more than 10 countries, involving hundreds of police officers. Investigative measures are ongoing in several EU countries, including Bulgaria, Croatia, Cyprus, Czechia, Italy, Luxembourg, the Netherlands, Slovakia and Spain, as well as in non-EU countries. A total of 195 individuals are being investigated, with more than 400 companies involved. 

A freezing order of over €520 million is in execution to compensate the damage to the EU and the national budgets. In Italy alone, 129 bank accounts are being frozen, and 192 real estate properties seized, together with 44 luxury cars and boats.

According to the investigation, people linked to several mafia clans invested into a criminal syndicate, which set up a highly profitable tax evasion scheme. 

European Chief Prosecutor Laura Kövesi: 

“’Moby Dick’ is a defining investigation for the EPPO. It has been a while since we started to ring the alarm bell about dangerous organised crime groups’ heavy involvement in fraud to the EU budget. Beyond the colossal damages that they create, we have been warning about the threat to our internal security their activity in this field represents. We now shed light on a first such big case. 

‘Moby Dick’ shows that there are not two separate criminal worlds. The world of the really bad and dangerous criminals smuggling drugs, trafficking people on one side; and the world of white-collar criminals, ‘merely’ corrupting and laundering money, on the other side.”

The level of complexity and efficiency of this criminal syndicate committing VAT carousel fraud is unprecedented. Between 2020 and 2023, it issued invoices for the sales of airpods, laptops and other electronic goods of more than €1.3 billion. 

Mafia methods also seem to have been used to settle conflicts that arose within the criminal syndicate between the members of the different criminal organisations.   

VAT carousel fraud takes advantage of EU rules on cross-border transactions between its Member States, as these are exempt from value added tax (VAT). Based on the evidence, the suspects established companies in Italy and other EU Member States, as well as in non-EU countries, in order to trade the goods through a fraudulent chain of missing traders – who would vanish without fulfilling their tax obligations. Other companies in the fraudulent chain would subsequently claim VAT reimbursements from the national tax authorities.

The Judge for Preliminary Investigations at the Court of Milan ordered the pre-trial detention of 43 of the suspects: 34 will remain in prison and nine in house arrest. Seven European arrest warrants were issued at the request of the EPPO for suspects located in Bulgaria, Czechia, the Netherlands, Spain and non-EU countries. Another four suspects were subject to a temporary ban from the practice of commercial activities. 

The investigation was conducted by the Italian Financial Police of Varese (Guardia di Finanza of Varese) and the Italian State Police (Squadra Mobile di Palermo and Servizio Centrale Operativo), under the supervision of the EPPO. The Italian Financial Police of Milano and Palermo also contributed to the investigation. The investigative measures were carried out also with the support of Europol and of several national law enforcement agencies. 

All persons concerned are presumed to be innocent until proven guilty in the competent Italian courts of law.

At the request of the European Public Prosecutor’s Office (EPPO) in Milan (Italy), the Italian Financial Police (Guardia di Finanza) has seized two properties in an investigation into the embezzlement of €1 million in EU and national funds, involving a vocational training institute. 

The focus of the investigation is funding that a vocational training institute received to organise trainings and professional refresher courses, supposed to be free of charge for the participants. While the courses have taken place, the evidence revealed that the suspects had asked the participants to pay a fee. Meanwhile, the suspects allegedly used the EU funds to purchase two properties in Magenta (Italy). To recover the embezzled EU funds, the Italian Financial Police has seized the properties.

The project was co-financed under the European Social Fund (ESF), the European Regional Development Fund (ERDF), and the Cohesion Fund for the Region of Lombardia.

All persons concerned are presumed to be innocent until proven guilty in the competent Italian courts of law.

A coordinated sting by the European Public Prosecutor’s Office (EPPO) in Bologna and Milan (Italy) today dismantled a criminal gang, alleged to have evaded the payment of €113 million in VAT, while using a Chinese underground banking network for money laundering.

Searches were carried out today in 20 cities in the regions of Marche, Emilia Romagna, Puglia, Veneto, Toscana, Lombardia, Abruzzo, Campania, Piemonte and Lazio, in Italy. 

Seven suspects were arrested, including two alleged ringleaders, who will remain in prison. Five suspects were placed under house arrest with electronic bracelet. In addition, two other suspects will have to report regularly to the police. They are suspected of VAT fraud, criminal association and money laundering. 

The investigation identified a complex scheme of international tax fraud, carried out through numerous ghost companies (“missing traders”), which imported hundreds of containers of clothing and accessories from China to Italy, using triangulations with Bulgaria and Greece, to hide the origin of the goods. It is understood that the criminal scheme had a turnover of at least €500 million, while evading the payment of VAT and custom duties. 

Based on the evidence, the illicit profits were laundered using a Chinese underground banking network with clandestine branches in the region of Marche (central Italy). The transfer of illicit funds abroad occurred through shell companies and false invoices, in order to circumvent anti-money laundering measures. The money passed through many European countries, including Bulgaria, Denmark, Estonia, France, Ireland, Germany, Greece, Spain and the UK, before arriving to China. The evidence shows that some of the money returned via banking to Italy, where the organisation invested it in legitimate commercial businesses.

During the searches, extensive documentation was seized. A freezing order of €116 million was also executed against 33 suspects. Five Chinese restaurants and one shopping centre were seized, as well as one house and one apartment belonging to the suspects. Police officers also seized eight high-end cars. Several bank accounts were frozen.

Today’s searches were conducted by the Italian Financial Police (Guardia di Finanza - GDF) of Ancona, with the cooperation of other GDF Commands operating where the investigative measures were carried out. The investigation also counted on the support of the Italian Financial Police of Milan (Nucleo di Polizia Economico-Finanziaria di Milano), as well as Bulgaria’s National Revenue Agency, Germany’s State Criminal Police Office (Landeskriminalamt) from Hesse and Greece’s General Directorate of Financial and Economic Crime Unit.

All persons concerned are presumed to be innocent until proven guilty in the competent Italian courts of law.