EPPO

The European Public Prosecutor’s Office (EPPO) in Turin (Italy) has secured convictions against 13 defendants, including three ringleaders, in the ‘Greasy Hands’ investigation. The defendants were proven to have operated a criminal organisation that imported vehicle lubricants into the Italian market while systematically evading VAT, resulting in losses exceeding €15 million. 

They were convicted of criminal association and tax fraud, receiving prison terms between one and four years, amounting to a combined total of 34 years.

The verdicts, delivered by the Court of Turin and the Court of Matera, were the result of plea agreements and abbreviated trial procedures, as the majority of the defendants pleaded guilty to the charges. The courts also ordered the confiscation of over €12 million, as well as company shares, real estate, vehicles, watches, luxury items and cash. This is a first court decision, still subject to appeal.

At the heart of the fraudulent scheme is a criminal association formed of individuals operating in Italy, as well as in Belgium, Czechia, Estonia, Hungary, Poland, Slovakia and Slovenia, who introduced and marketed large quantities of lubricating oils for cars and trucks, intended for consumers in the Italian market. The criminal organisation used multiple strategies to evade VAT and the payment of excise duties, including forged transportation documents and a network of shell companies.

The criminal group is also suspected of counterfeiting motor oil brands and laundering the illicit profits.

The investigation additionally showed that a company operating in the Matera area, which is one of the main hubs for the sale of vehicle lubricants in central and southern Italy, also sourced oil from the criminal association, concealing over €52 million in profits from the tax authorities.

It is estimated that the illicit activities of the criminal organisation caused a loss of €14 million in unpaid VAT and over €1 million in excise duties, during the 2017–2023 period.

The European Public Prosecutor’s Office (EPPO) in Frankfurt (Germany) and Milan (Italy) has dealt a major setback to networks operating cross-border VAT fraud schemes linked to the sales of thousands of second-hand luxury cars, causing estimated losses of €100 million.

Under the EPPO-led investigations, code-named ‘Vortex’, around 80 searches were carried out yesterday in Bulgaria, Croatia, Germany, Italy, Latvia, Luxembourg and Poland, supported by 500 law enforcement agents (tax and police officers). Six individuals were arrested In Germany and Italy. 

In addition, seizing orders of over €20 million were executed. In Italy alone, 50 bank accounts were frozen and 14 properties were seized, as well as two plots of land and 25 cars, including 19 luxury vehicles. Two cars, cash and luxury items were also seized in Germany, and bank accounts were frozen. 

The criminal groups under investigation are suspected of involvement in large-scale VAT carousel fraud – a complex scheme that exploits EU rules on cross-border transactions between Member States, which are exempt from value-added tax (VAT).

According to the investigations, several thousands of cars were sold within cross-border fraud schemes all over Europe, using hundreds of shell companies, forged documents and fictious invoices, in order to evade the payment of VAT. In some cases, the vehicles were fictitiously sold to companies in Liechtenstein and San Marino, where the cars were never registered, before they were actually sold to car dealers and customers in Italy and other Member States.

In addition, the VAT fraud carousel allowed the criminal network to claim VAT reimbursements from the national tax authorities, to which the alleged perpetrators were not entitled, all leading to substantial illicit profits.

It is understood that the criminal groups also fraudulently applied reduced VAT, under the so-called ‘margin taxation scheme’. This provision allows resellers to pay VAT only on their profit margin (the difference between the price paid for the item and the price for which it is sold), when selling second-hand goods bought from private individuals. However, the companies under investigation applied this provision unlawfully.

It is estimated that the activities under investigation have caused losses of at least €100 million to the EU and national budgets.

These investigations were supported by Germany’s Tax Investigation Office in Stuttgart (Finanzamt Stuttgart II – Steuerfahndungsstelle) and the Italian Financial Police (Guardia di Finanza) of Varese, as well as Italy’s Customs and Monopolies Agency of Bolzano (Agenzia delle Dogane e dei Monopoli di Bolzano). 

The investigations also counted on the support of Europol, through analytical assistance and coordination tools, with additional backing from national law enforcement agencies – highlighting the value of cross-border cooperation against organised crime.

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

At the request of the European Public Prosecutor’s Office (EPPO) in Milan and Palermo (Italy), the Italian State Police (Central Operational Service, SISCO and Police Office of Palermo), together with the Italian Financial Police (Guardia di Finanza) of Varese have executed eleven arrest warrants issued by the judge of preliminary investigation of Milan.

The arrested suspects are believed to have participated in the criminal syndicate responsible for a €520 million VAT fraud scheme, code-named ‘Moby Dick’. Their activity was to launder the proceeds of the VAT fraud and they allegedly used mafia methods and aided and abetted the Camorra criminal organisation.

Today’s arrests follow investigative measures carried out by the EPPO in November 2024 in more than 10 countries, where 43 suspects had already been arrested. One of the suspected ringleaders had turned himself in last month when he landed at Milan Malpensa airport from Tirana (Albania).

The evidence gathered throughout the ongoing investigation revealed further information about the suspects, including their links to the Nuvoletta and Di Lauro clans of the Camorra criminal organisation.

The level of complexity and efficiency of the criminal syndicate behind ‘Moby Dick’ 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. 

Up until today, 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 were frozen, and 192 real estate properties seized, together with 44 luxury cars and boats.

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

On behalf of the European Public Prosecutor’s Office (EPPO) in Naples (Italy), the Italian Carabinieri today seized assets of up to €1.1 million, in an investigation into agricultural funding fraud and corruption involving public officials and a police officer.

The seizure was executed in the province of Salerno against 14 individuals, of a total of 39 suspects under investigation, by the Provincial Command of the Carabinieri of Naples (EPPO unit). Searches were also carried out at the homes and company premises of the suspects, in order to obtain evidence, including mobile phones, computers and documents.

The investigation, carried out between 2022 and 2024, revealed the existence of a criminal association which, according to the findings, operated with the aid of public officials in the Campania region, as well as a member of law enforcement. The criminal group was further enabled by the assistance of accountants.

Based on the evidence, the suspects requested funds from the European Agricultural Fund for Rural Development (EAFRD) using false information, in collusion with officials from the Campania region, which allowed them to illicitly obtain substantial amounts. Corruption is also under investigation, as public officials were allegedly promised a percentage of the funds. 

In addition, the inquiry exposed a member of the Italian Financial Police (Guardia di Finanza) at the service of the criminal gang, responsible for reporting any investigations into the fraud and to mislead investigators. 

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

A suspected ringleader in the cross-border investigation into a €520 million VAT fraud scheme, code-named ‘Moby Dick’, has turned himself in and was detained yesterday in Milan (Italy) at the request of the European Public Prosecutor’s Office (EPPO) in Milan and Palermo. The individual had evaded arrest in Prague (Czechia) in November 2024, prior to an action targeting the international criminal ring, carried out by the EPPO, and had been at large for six months.

The suspect landed at Milan Malpensa airport from Tirana (Albania) and surrendered to the police units dedicated to the EPPO (Italian Guardia di Finanza and Polizia di Stato). He is suspected of criminal association, aggravated by mafia methods and aiding and abetting mafia clans, money laundering and committing a series of tax offences relating to intra-community VAT fraud.  

During the action carried out by the EPPO in November 2024 in more than 10 countries, 43 suspects had already been arrested. 

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

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 were frozen, and 192 real estate properties seized, together with 44 luxury cars and boats.

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