EPPO

At the request of the European Public Prosecutor’s Office (EPPO) in Bologna (Italy), the Italian Financial Police (Guardia di Finanza) of Ravenna seized more than 28 million in assets in connection with a large-scale VAT carousel fraud investigation.

The measures follow a complex investigation into the production and distribution of software and IT products, which revealed anomalies linked to abnormally low sales prices. The evidence uncovered an international VAT carousel fraud scheme, involving more than 70 companies in several EU countries, as well as Switzerland and Curaçao.

In Ravenna, investigators found that a company had used false invoices worth over €128 million, leading to an estimated VAT loss of more than €27 million. A second company near Rome was found to have recorded fictitious transactions amounting to around €53.5 million, with an estimated VAT loss of around €12 million. Together, the companies are believed to have defrauded €40 million in VAT.

So far, assets worth more than €28 million have been seized, including bank accounts, insurance policies, real estate and company shares. The court is also assessing the appointment of a judicial administrator for the seized shares, to safeguard ongoing business activities.

The investigation is ongoing, with the aim of identifying additional suspects and further clarifying the full extent of the fraud.

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

At the request of the European Public Prosecutor’s Office (EPPO) in Rome (Italy), two suspects were arrested yesterday and freezing orders of up to €5 million were carried out, in an investigation involving multiple Italian companies suspected of fraudulent use of EU and national funds destined to finance small and medium companies (SMEs). 

The arrests and freezing orders, issued by the judge for preliminary investigations of the Court of Milan, were executed by the Italian Financial Police (Guardia di Finanza – Nucleo Speciale di Polizia Valutaria). Searches were carried out in the cities of Cremona, Lecce, Milan, Rome and Rimini. Ten people and seven companies are under investigation, also supported by judicial police officers working at the EPPO office in Rome.

Based on the evidence, between June 2021 and October 2024, the companies under investigation fraudulently received approximately €5 million from the European Guarantee Fund (EGF), after providing documents that contained false information about the companies and individuals involved. The funds were paid by Italian public bank Medio Credito Centrale, which manages public guarantee schemes, including the SME Guarantee Fund. The suspects then used the funds for purposes other than those they were meant for. According to the investigation, at least €1.4 million was transferred to bank accounts under the control of the suspects in several EU Member States, including Belgium and Lithuania, in order to launder the money. 

Some of the suspects under investigation were already linked to other EPPO cases of VAT carousel fraud and NextGenerationEU fund fraud involving organised crime.

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

At the request of the European Public Prosecutor’s Office (EPPO) in Venice (Italy), the Italian Financial Police (Guardia di Finanza) of Treviso carried out searches and seized assets worth up to €486 000, in connection with an investigation into suspected subsidy fraud, embezzlement of public funds, and money laundering.

According to the evidence, two companies applied for funds from the EU’s Recovery and Resilience Facility (RRF) for Italy, intended to support their digital transition. The companies are believed to have submitted false documentation and declarations regarding the existence of operational headquarters in southern Italy, their financial solidity, and their intention to implement the funded projects, which were never started. 

Further investigations led to two additional companies and six individuals, with strong links to the above-mentioned companies, that were allegedly involved in similar fraudulent activity. The suspects are believed to have illegally obtained €486 000 in RRF funds, which they diverted from their intended use, laundering a total of €183 000 by paying their debts towards other companies of the criminal association. 

The Italian Financial Police (Guardia di Finanza) of Treviso seized financial assets and real estate owned by the suspects and their companies for a value of up to €486 000. The searches were carried out  in the provinces of Bari, Barletta-Andria-Trani, Brescia, Treviso and Venice. 

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), the Italian Financial Police (Guardia di Finanza) of Palermo carried out extensive searches this week (22 July), uncovering one of the largest illegal cigarette production facilities in Europe.

The factory, located in Stornara (province of Foggia), was equipped for large-scale production, with the capacity to produce up to 2 million cigarettes per day. The estimated value of the site is over €1.3 million.

Searches were conducted across the regions of Apulia and Sicily, targeting the illicit logistics network behind the facility. The searches were led by officers from the Palermo Provincial Command, with support from units in Bari and Foggia. 

Inside the 3 000 m² industrial site, officers found 45 pallets of cigarettes weighing around 13 tonnes, 165 bags of shredded tobacco, and 134 pallets of precursors. These included packaging materials bearing counterfeit logos of well-known tobacco brands.

Ten individuals of Bulgarian and Ukrainian nationality were found living in makeshift accommodations inside the factory. They are suspected of being involved in the illegal production and possession of smuggled tobacco products, and in trademark counterfeiting.

Further materials used to produce cigarettes linked to the same criminal network were seized at an additional site in Andria.

The discovery follows several months of investigative work that began when smuggled cigarettes were seized in Palermo. Through months of surveillance, investigators were able to trace the supply chain and identify the production sites, despite the sophisticated counter-surveillance measures used by the suspects.

Had the seized products reached the market, the estimated loss in evaded VAT and excise duties would have caused losses of over €3.2 million to the national and EU budgets. The illegal factory was capable of generating illicit profits of approximately €350 000 per day. Over the course of a year, this would have amounted to more than €120 million in profits, with an estimated damage to public finances of around €80 million.

All persons concerned are presumed 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), the Italian Financial Police (Guardia di Finanza) of Biella carried out searches last week (17 July), in an investigation into suspected fraud involving funds from the EU’s Recovery and Resilience Facility (RRF) for Italy.

The investigation concerns a suspected organised criminal group that allegedly defrauded public budgets by fraudulently obtaining RRF funds and by claiming tax credits for fictitious energy efficiency works. According to the investigation, the suspects, tax advisors and accounting service centres operating across Italy, set up companies in the names of strawmen and falsified the companies’ accounts to access public financing and fiscal incentives.

Thirty-five individuals and sixteen companies are under investigation for suspected participation in a criminal organisation, aggravated fraud against the Italian State, accounting  and tax fraud. The judge for preliminary investigations at the Court of Bologna ordered the seizure of €3.3 million, corresponding to the suspected proceeds of the offences.

During the searches, 18 warrants were executed at locations in the provinces of Arezzo, Empoli, Fermo, Florence, Bologna, Pesaro, Perugia, Prato, Rome, Turin, Verona, Vicenza to secure evidence, including tax documents and contracts. Funds held by four suspects in their Italian bank accounts were seized up to a total of €3 385 986. If these funds are insufficient, other assets such as real estate and vehicles will be seized to recover the equivalent amount.

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