EPPO

At the request of the European Public Prosecutor’s Office (EPPO) in Palermo (Italy), over €760 000 in assets have been seized, in an investigation into fraud involving EU agricultural funding aimed at building and modernising olive oil mills.

It is alleged that, between 2018 and 2023, three suspects set up a fraudulent scheme to receive €3.5 million in non-reimbursable funding from EU and national sources, in the context of the European Agricultural Fund for Rural Development (EAFRD), using their respective companies. 

According to the evidence, one of the suspects, who is also the manager of the olive oil company applying for the funding, used false invoices supplied by a second company to artificially inflate the reported costs of the construction and modernisation of two olive oil mills. In so doing, the suspects are thought to have made an illicit financial gain of approximately €248 000. The company used the same false invoices with the inflated prices in their tax declaration, allowing it to evade VAT payments amounting to around €252 000. The second company is understood to have been controlled by the same family that owned the olive oil company. 

The investigation also revealed evidence of self-money laundering – a form of money laundering in which the same person perpetrates both the primary offence and the money laundering offence. It is believed that a portion of the allegedly falsified expenses, totalling €260 000, was transferred to a third company, also owned and operated by the suspects of the fraudulent scheme. This illicitly obtained money was then used to settle the debts of the perpetrators of the fraud.

In order to recover the damage to the EU budget, the Italian Financial Police (Guardia di Finanza) of Sciacca seized about €200 000 in cash and real estate of the suspects under investigation, including the oil mill, following a freezing order issued by the judge for preliminary investigations at the Court of Sciacca.

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 Turin (Italy), searches were conducted yesterday in several locations and four suspects were arrested, in an investigation into a €10 million VAT carousel fraud involving tyres. A seizure order of up to €10 million was also executed. 

The investigative measures, which involved dozens of officers, were carried out in six regions (Campania, Lazio, Tuscany, Emilia-Romagna, Lombardy and Calabria) by the Italian Financial Police (Guardia di Finanza) of Savona. Three of the suspects will remain in pre-trial detention and one in house arrest, on suspicion of criminal association and tax evasion, as determined by the Court of Savona. The Italian Financial Police also seized ten properties and four cars, as well as documents and evidence. 

On the radar of the EPPO is a criminal organisation that orchestrated a VAT fraud scheme involving the sales of tyres. It is understood that the suspects, using five companies in the regions of Lombardy, Emilia-Romagna and Tuscany, acted as intermediaries between suppliers from Belgium, Germany, Hungary, Netherlands, Poland and Spain, and customers in Italy.

The fraudulent scheme, which involved a structure of shell companies, took advantage of EU rules on cross-border transactions between its Member States, as these are exempt from value-added tax, by using a chain of missing traders, which would vanish without fulfilling their tax obligations. Other companies in the fraudulent chain would subsequently claim undue VAT reimbursements from the national tax authorities. 

According to the investigation, the fraudulent activities generated a turnover of more than €50 million since 2016, causing an estimated damage of around €10 million in unpaid VAT. The VAT evasion also allowed the group to resell the tyres at extremely advantageous prices, distorting the principles of fair competition on the market.

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 Naples (Italy), over €520 000 in assets have been seized, in an investigation into fraud involving EU agricultural funding aimed at supporting a wine producer’s conversion to organic farming.

At issue is a company operating in the wine sector, whose legal representatives attested that it had carried out the conversion to organic methods of cultivation, in order to receive funds co-financed by the EU. However, during checks carried out by Italy’s Institute for Ethical and Environmental Certification (ICEA – Istituto per la Certificazione Etica ed Ambientale), chemicals that are not allowed in organic farming were detected in the soil.

In order to recover the damage to the EU budget, the Italian Financial Police (Guardia di Finanza) of Brindisi seized real estate of the suspects under investigation, following a freezing order issued by the judge for preliminary investigations at the Court of Lecce.

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

 In the context of a large-scale investigation led by the European Public Prosecutor’s Office (EPPO) in Turin (Italy), several house searches, arrests and seizures took place today, in a probe into an alleged criminal organisation suspected of a VAT fraud involving tyres.

The Italian Financial Police (Guardia di Finanza) from Genoa, Foggia and Rome carried out the searches, seizures and arrests. Two people were arrested, two were placed under house arrest and another suspect is not allowed to leave his municipality. The Court of Foggia also ordered the freezing of almost €40 million, and the Guardia di Finanza succeeded in seizing 47 bank accounts, 11 real estate properties, four cars, and €56 000 in crypto currencies today. Moreover, the Anti-Cybercrime Office (Office anti-cybercriminalité, OFAC) of the French Judicial Police (Direction nationale de la police judiciaire, DNPJ) shut down several websites to stop the alleged fraudulent trade activity. The seizing of bank accounts is still ongoing.

On the radar of the EPPO is a suspected criminal organisation, linked by family ties, active in the online sale of tyres for cars and other motor vehicles.

According to the evidence collected so far, the suspects under investigation created a multitude of companies ostensibly based in different EU Member States to take advantage of EU rules on cross-border transactions, as these are exempt from VAT. It is understood that in reality, the companies were operating in Italy, and allegedly drew up false invoices and accounting documents to pretend that they were based abroad.

The suspected criminal organisation under investigation was involved in the online sale of tyres, using the drop-shipping model whereby goods are sent to the customer directly by the supplier. Due to this sales model, the seller does not need any physical shop or storage.

It is alleged that, since 2017, the suspects used a chain of fictitious companies in several EU Member States to sell tyres to customers in Italy via various e-commerce platforms. The fictitious companies based in the Canary Islands (Spain) were the official sellers of the tyres. The tyres came from legitimate European suppliers and were then directly delivered to the customers.

According to the investigation, the commercial operations were carried out without collecting or reimbursing VAT in any EU Member State. As a result, the tyres were sold at very lucrative prices, causing a VAT loss of almost €40 million and generating a turnover of €178 million.

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 Palermo (Italy), a freezing order was executed yesterday against a farmer suspected of agricultural funding fraud, with an estimated damage of €161 000.

According to the investigation, the suspect forged statements to falsely declare ownership and possession of 64 hectares of land in the province of Caltanissetta, in order to obtain European Union agricultural funds. It is believed that, between 2017 and 2022, the suspect unduly obtained €161 000 from the Italian Agricultural Payments Agency (AGEA – Agenzia per le erogazioni in agricoltura).

The freezing order, issued at the request of the EPPO by the judge for preliminary investigations of the court of Caltanissetta, was executed yesterday by the Carabinieri Agri-food Protection Department of Messina (Reparto Carabinieri per la Tutela Agroalimentare di Messina).

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

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.