The European Prosecutor’s Office revealed a scheme for trading cars from the United States
| The nimmersatt (« insatiable » investigation from German – note) covers the US and Russia, but includes contacts in Canada, Hungary, Ireland and the United Kingdom (UK), as well as 11 EU countries in the EPP jurisdiction. From Bulgaria, assistance was provided by the National Investigation Service. |
Investigations were conducted on April 16 and 17 in Bulgaria, Estonia, Germany, Hungary, Latvia, Lithuania, the Netherlands, Portugal, Romania and Spain. Ten suspects have been arrested, including one of the alleged leaders of the scheme, who is a Lithuanian citizen.
Eighteen other citizens, all Lithuanians, were detained for questioning. Major suspects with Russian citizenship are also the subject of investigation.
« Live like barons »: Bulgarians participating in fraudulent schemes
The criminal network is involved in smuggling of heavily damaged US cars in the EU, which are subsequently sold to end customers after surface repair. In this way, duties and VAT are avoided on a large scale. Dangerous cars are offered to European users who do not suspect the risks at all while paying a high price.
How does the scheme work
Criminal organizations take advantage of the US market for catastrophic cars that are often auctioned or disassembled for parts. The EPPO investigated group buys in large quantities of crushed cars from US auction insurance companies and transports them to the EU.
With the help of a network of phantom companies and fake invoices concealing the origin of cars, they arrive in the EU with a deleted commercial history.
The vehicles are then transported by land to Lithuania, where they are repaired in auto repair shops. However, according to the evidence gathered, repairs are only cosmetic to make cars look new and go through technical certification.
| The cars are then sold in Germany and other EU countries, presenting themselves to be fully restored after a crash or as completely healthy. Despite the repair, however, cars have hidden damage, including missing airbags and other serious safety problems. Cheaper cars are resold in markets in Eastern Europe. |
According to the investigation in Germany, cars are sold by car dealerships, which are part of the criminal organization. It is clear that these car dealerships apply reduced VAT under the so -called. Marjov taxation scheme.
The scheme allows the resumes to pay VAT only on their profits (the difference between the purchase and the sale price) when they sell used goods purchased by individuals. However, the investigation companies used this scheme illegally because the vehicles were imported for commercial purposes – mainly by the United States and in some cases by Canada.
A complex international criminal chain
Thanks to the joint efforts of the European Prosecutor’s Office (EPPO), European partners and national authorities, the investigation reveals a complex criminal scheme with branches in 18 countries. It affects members of the criminal organization from Russia and Lithuania, as well as suspects responsible for importing and transporting cars, and dozens of auto -shops.
Damage is still being evaluated, but according to preliminary estimates are for 31 million euros from unpaid VAT and duties.
An asset freezing orders have been issued worth up to EUR 26.5 million. Currently, bank accounts have been frozen and 116 cars have been seized for 2.3 million euros, as well as half a million euros in cash and luxury goods. Real estate, plots and shares in companies for 5.1 million euros were also seized.
