A coordinated raid by the European Public Prosecutor’s Office (EPPO) in Athens (Greece), Madrid (Spain), Paris (France) and Sofia (Bulgaria) has dealt a significant blow to criminal networks flooding the EU market with goods fraudulently imported from China, while evading custom duties and VAT. The criminal scheme, which involved the massive importation of garments, shoes, e-scoters, e-bikes and other goods, is believed to have caused an estimated damage of approximately €700 million.
The investigation carried out by the EPPO, code-named ‘Calypso’, spans 14 countries: Bulgaria, China, Czechia, Denmark, France, Germany, Greece, Hungary, Italy, Poland, Portugal, Slovakia, Slovenia and Spain. A total of 101 searches were conducted yesterday at the offices of customs brokers, companies controlled by the organized criminal groups under investigation, the premises of the suspects, and at the offices of tax advisers and representatives, lawyers, accountants and transport companies, in Bulgaria, Greece, France and Spain. Ten suspects were arrested, including two customs officers. In addition, firearms and cold weapons were found and seized in the houses of three of the suspects.
Law enforcement agents seized €5.8 million (of which €4.75 million in Greece and the remaining in France and Spain), in different currencies, including Hong Kong dollars, euros in digital wallets and cryptocurrencies. In addition, 7 133 e-bikes and 3 696 e-scooters were secured, as well as 480 containers for further checks and verification in the Port of Piraeus. Eleven properties located in Spain were also seized, as well as 27 vehicles and luxury items (bags, watches and jewelry). Freezing orders were also issued in Greece to seize real estate, boats and bank accounts.
At issue are several criminal networks, mainly controlled by Chinese nationals, that handle the full circuit of the goods imported from China into the EU market, including distribution to different Member States and sales to end customers, as well as money laundering and sending the profits back to China, while defrauding the payment of customs duties and committing large-scale VAT fraud.
The fraudulent scheme started with the import of the shipments into the EU through the port of Piraeus. In order to evade custom duties, the documents were falsified this way concealing the true value and nature of the merchandise. Part of the criminal gang were professional enablers operating at the customs entry point to facilitate the initial clearance, followed by the transportation of the merchandise by companies operating in Greece with a Greek VAT to a chain of buffer and shell companies responsible for distributing the goods and selling them on the black market. The transport documents were destroyed as soon as the goods had been delivered, and the merchandise was sold to end customers, as the final point of a highly concealed parallel economy.
After. the proceeds of the crime were transferred to China using different money laundering techniques, including providing money laundering services to other criminal organizations via trade-based underground banking systems.
Currently, Greece’s Independent Authority for Public Revenue (AADE) is actively supporting the EPPO to further evaluate the extent of the damage in evaded customs duties.
