European Public Prosecutor's Office arrests three suspects in VAT fraud in Bulgaria, Germany and Poland

At the request of the European Public Prosecutor’s Office (EPPO) in Munich (Germany), three suspects have been arrested, and multiple searches were carried out in Germany, Bulgaria, and Poland this week (1 April), in an ongoing investigation into a €50 million VAT fraud scheme involving the trade of electronic goods. The announcement was made today. April 3 by the EPPO based in Luxembourg.

The enforcement actions were executed in cooperation with the Tax Investigation Office in Berlin (Steuerfahndung Berlin), the Bulgarian National Investigation Service, the General Directorate National Police in Sofia, and Poland’s Central Anti-Corruption Bureau, the statement says.

According to the investigation, the suspects acted as strawmen for German missing trader and buffer companies, taking part in a cross-border VAT carousel fraud – a complex criminal scheme that takes advantage of EU rules on cross-border transactions between its Member States, as these are exempt from value-added tax – trading with electronic devices.

The suspects are allegedly part of an organised crime group responsible for defrauding €50 million in VAT. Two of the three individuals were released on the day of their arrest after cooperating with authorities and providing further information on the ringleaders.

The investigation remains ongoing and is directly connected to the EPPO investigation cluster Midas, a large-scale VAT fraud spanning 17 countries and involving an estimated damage of €195 million.