Investigation Goliath: Suspected ringleaders of international crime group charged with €93 million VAT fraud

Three suspected ringleaders of an international criminal group were indicted yesterday at the Regional Court of Dusseldorf (Germany) for a €93 million VAT fraud, following an investigation by the European Public Prosecutor’s Office (EPPO) in Hamburg, code-named Goliath. The three were charged with criminal association and VAT fraud on a large scale.

Two of the defendants remain in pre-trial detention. One of the suspects was arrested during an action carried out by the EPPO on 22 November 2023, targeting the international criminal ring. Another suspect – a Danish citizen who had fled to Africa to escape detention – was arrested in Nairobi (Kenya) and deported on 5 June 2024.

The defendants are believed to be the ringleaders of a criminal organisation, active in the international trade of consumer electronics (mainly AirPods). They are suspected of evading tax by means of a 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 – with estimated losses to the EU and national budgets of at least €93 million.

According to the investigation, the suspects established companies in Germany 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.

If convicted, the defendants face up to 10 years of imprisonment.

This investigation, which counted on the support of Europol, German tax agencies and several national police forces, has stretched across Denmark, France, Germany, Hungary, Lithuania, the Netherlands, Sweden and Switzerland.

Earlier in this investigation, the EPPO seized 1 800 AirPods, as well as cash, two luxury cars, worth a combined €550 000, and a high-end watch, worth €907 000.

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.

Article Credit: https://www.eppo.europa.eu/en/media/news/investigation-goliath-suspected-ringleaders-international-crime-group-charged-eu93