(Luxembourg, 3 July 2025) – The European Public Prosecutor’s Office (EPPO) in Frankfurt (Germany) and Milan (Italy) has dealt a major setback to networks operating cross-border VAT fraud schemes linked to the sales of thousands of second-hand luxury cars, causing estimated losses of €100 million.
Under the EPPO-led investigations, code-named ‘Vortex’, around 80 searches were carried out yesterday in Bulgaria, Croatia, Germany, Italy, Latvia, Luxembourg and Poland, supported by 500 law enforcement agents (tax and police officers). Six individuals were arrested In Germany and Italy.
In addition, seizing orders of over €20 million were executed. In Italy alone, 50 bank accounts were frozen and 14 properties were seized, as well as two plots of land and 25 cars, including 19 luxury vehicles. Two cars, cash and luxury items were also seized in Germany, and bank accounts were frozen.
The criminal groups under investigation are suspected of involvement in large-scale VAT carousel fraud – a complex scheme that exploits EU rules on cross-border transactions between Member States, which are exempt from value-added tax (VAT).
According to the investigations, several thousands of cars were sold within cross-border fraud schemes all over Europe, using hundreds of shell companies, forged documents and fictious invoices, in order to evade the payment of VAT. In some cases, the vehicles were fictitiously sold to companies in Liechtenstein and San Marino, where the cars were never registered, before they were actually sold to car dealers and customers in Italy and other Member States.
In addition, the VAT fraud carousel allowed the criminal network to claim VAT reimbursements from the national tax authorities, to which the alleged perpetrators were not entitled, all leading to substantial illicit profits.
It is understood that the criminal groups also fraudulently applied reduced VAT, under the so-called ‘margin taxation scheme’. This provision allows resellers to pay VAT only on their profit margin (the difference between the price paid for the item and the price for which it is sold), when selling second-hand goods bought from private individuals. However, the companies under investigation applied this provision unlawfully.
It is estimated that the activities under investigation have caused losses of at least €100 million to the EU and national budgets.
These investigations were supported by Germany’s Tax Investigation Office in Stuttgart (Finanzamt Stuttgart II – Steuerfahndungsstelle) and the Italian Financial Police (Guardia di Finanza) of Varese, as well as Italy’s Customs and Monopolies Agency of Bolzano (Agenzia delle Dogane e dei Monopoli di Bolzano).
The investigations also counted on the support of Europol, through analytical assistance and coordination tools, with additional backing from national law enforcement agencies – highlighting the value of cross-border cooperation against organised crime.
All persons concerned are presumed to be innocent until proven guilty in the competent 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.
List of most important partners and national authorities involved:
- Europol
- Bulgaria’s National Investigation Service (Национална следствена служба); General Directorate National Police (Главна дирекция “Национална полиция”); General Directoratе Gendarmerie and Specialised Counter-Terrorism Department (Главна дирекция “Жандармерия и специализан отряд за борба с тероризма”); and General Directorate “Combating Organised Crime” (Главна дирекция „Борба с организираната престъпност“ - ГДБОП)
- Croatia's General Police Directorate of the Ministry of the Interior, Directorate of Criminal Police, Police National Office for the Suppression of Corruption and Organized Crime (Ravnateljstvo policije Ministarstva unutarnjih poslova Republike Hrvatske, Uprava kriminalističke policije, Policijski nacionalni ured za suzbijanje korupcije i organiziranog kriminaliteta); Police Administration of Istria County (Policijska uprava Istarska); Independent Sector for Financial Investigations of the Tax Administration of the Ministry of Finance of the Republic of Croatia (Samostalni sektor za financijske istrage Porezne uprave Ministarstva financija Republike Hrvatske)
- Germany: Public Prosecutor’s Office Stuttgart (Staatsanwaltschaft Stuttgart), Tax Investigation Office Stuttgart (Steuerfahndung Stuttgart), Tax Investigation Offices from the federal states of Baden-Wurttemberg, Bavaria, Hesse, Rhineland-Palatinate, Hamburg, Berlin and Bremen (Baden-Württemberg, Bayern, Hessen, Rheinland-Pfalz, Bremen, Hamburg, Berlin und Bremen), State Office for Combating Financial Crime North Rhine-Westphalia (Landesamt zur Bekämpfung der Finanzkriminalität NRW), police headquarters in Stuttgart (Polizeipräsidium Stuttgart), police headquarters Operation Baden-Wuerttemberg (Polizeipräsidium Einsatz Baden-Württemberg), police headquarters in Munich (Polizeipräsidium München) and police department Wetterau (Polizeidirektion Wetterau)
- Italian Financial Police (Guardia di Finanza) of Varese; Italy’s Customs and Monopolies Agency of Bolzano (Agenzia delle Dogane e dei Monopoli di Bolzano)
- Latvia’s Tax and Customs Police Department of the State Revenue Service of the Republic of Latvia (Valsts ieņēmumu dienesta Nodokļu un muitas policijas pārvalde)
- Luxembourg’s Criminal Police – Financial and Economic department (Service de Police Judiciaire – Section Entraide Judiciaire Internationale)
Poland’s National Police – Voivodship Police Station in Gdansk (Komenda Wojewódzka Policji w Gdańsku)