The European Public Prosecutor’s Office (EPPO) in Riga (Latvia) carried out 16 searches on 19 June 2023 and seized up to €6 million in assets, in an investigation into a suspected €14 million VAT fraud.
At issue is an investigation into a municipal company suspected of colluding with private companies to artificially inflate the prices of goods and services delivered. The suspected scheme inflated the operating costs of the municipal company, thus increasing the deductible expenses and allowing the company to pay less tax.
It is suspected that, before contracts were signed between the companies under investigation, the suspects agreed on simulated transactions and artificially inflated prices. The evidence collected indicates that some project implementation costs were not actually incurred, and that the expenditure was artificially increased.
The searches were carried out in several locations in Latvia, at the suspects’ homes and the offices of the companies under investigation, in cooperation with Latvia’s Corruption Prevention and Combating Bureau (Korupcijas novēršanas un apkarošanas birojs) and the Latvian Tax and Customs Police Department (Nodokļu un muitas policijas pārvalde).
In order to recover the damage to the EU budget, ten properties worth over €6 million have been seized.