Criminal gang defrauded €25m VAT on fuel oil

Will Green is news editor of Supply Management
13 January 2017

European crime agencies have dismantled a gang that defrauded states of millions of euros in VAT on fuel oil.

The gang, based in Spain and Portugal, used a “complex corporate architecture” including shell companies and missing traders, to defraud more than €25m from the hydrocarbon sector.

Eurojust, the EU’s crime-fighting agency, said the investigation began in Spain in 2015, targeting a criminal network selling fuel oils.

“The criminal organisation, by undercutting market prices with their untaxed oils, harmed commercial activities in the sector with such unfair competition that other operators not involved in the VAT fraud were compelled to get out of the business,” said Eurojust.

A total of 20 people have been arrested in Spain and 25 searches were carried out in Spain, Portugal and Italy. Some 16 bank accounts have been frozen in Slovenia and Portugal, where a further two arrests were made. Funds frozen in Slovenia amount to almost €91,000.

Francisco Jimenez-Villarejo, national member for Spain at Eurojust and chair of the Coordination Centre, said: “Organised VAT fraud represents a significant risk to the economy of the EU, and, as such, Eurojust will continue to do all it can to aid in the transnational coordination of the precautionary and investigative measures adopted by our national judicial authorities in order to defeat cross-border financial crime.

“With this Coordination Centre, Eurojust supported our home authorities in overcoming the absence of an international consensus on VAT fraud, which has been identified as the most relevant bottleneck obstruction in these types of investigations.”

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