(Luxembourg, 26 November 2024) – At the request of the European Public Prosecutor’s Office (EPPO) in Munich (Germany), two suspects were arrested today in an investigation into a €19 million cross-border VAT carousel fraud involving the sales of Voice over IP (VoIP).
The suspects, who were arrested in Frankfurt am Main (Germany) and in Rome (Italy), are believed to have acted as strawmen for a German buffer company, which served to hide the fraud from the authorities.
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). It is understood that the buffer company in Germany was part of a fraudulent chain of missing traders, which would vanish without fulfilling their tax obligations. Other companies in the fraudulent chain would subsequently claim VAT reimbursements from the national tax authorities.
The suspects were arrested with the help of the Leipzig Tax Investigation Office (Steuerfahndung Leipzig) and the Italian Financial Police in Rome (Guardia di Finanza). Three searches were also carried out in the premises of companies under investigation in Frankfurt am Main and Rome. A freezing order of €63 000 was also executed.
The investigation is ongoing, in order to ascertain the extent of the criminal activities.
All persons concerned are presumed to be innocent until proven guilty in the competent German 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.