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17/09/2026   European Public Prosecutor's Office News

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Croatia: Four individuals and two companies indicted for subsidy fraud in a probe involving the construction of a briquette production plant (Luxembourg, 18 September 2026) – The European Public Prosecutor’s Office (EPPO) in Zagreb (Croatia) has filed an indictment against four individuals and two companies for subsidy fraud involving the misuse of EU funds intended for the construction of a new briquette production plant. As previously reported, the investigation revealed that one of the indicted companies was a beneficiary of an EU subsidy for a construction project co-financed by the European Structural and Investment Funds (ESIF) and Next Generation EU’s Recovery Assistance for Cohesion and the Territories of Europe (REACT-EU). The funds were envisioned for the construction of a new briquette production plant, with eligible procurement costs amounting to €945 858, out of which 45% were non-refundable. According to the evidence, the two defendants, the director and the actual business manager of the indicted company, together with other accomplices, arranged a purchase of used briquette production machines, contrary to the co-financing conditions, at prices several times higher than they were worth. In order to implement the arrangement, the other two defendants procured, by means of their respective companies, the used machines from a company from the Republic of Serbia at the price of €398 866. Afterwards, while hiding the fact that those were used machines, they sold them as new machines to the indicted company at the price of €935 297.63. After that, the first two defendants requested €420 883.93 of non-refundable subsidies from the Croatian Agency for SMEs, Innovation and Investments (HAMAG-BICRO), falsely stating that the new equipment was purchased at market prices. The agency then made a first payment of €285 904.84. However, due to irregularities found, the payment of the remaining amount was denied. By doing so, one of the indicted companies obtained a pecuniary gain in the amount of €285 904.84 to the detriment of the EU, while other companies received a pecuniary gain in the total amount of €536 431.63 due to the difference between the purchase and sales prices of the machines. If found guilty, the defendants face between one and ten years in prison.   more   Hrvatska: Četiri fizičke osobe i dva trgovačka društva optuženi za subvencijsku prijevaru u istrazi koja uključuje izgradnju pogona za proizvodnju briketa (Luxembourg, 18. rujna 2026.) – Ured europskog javnog tužitelja (EPPO) u Zagrebu (Hrvatska) podignuo je optužnicu protiv četiri osobe i dva trgovačka društva zbog subvencijske prijevare vezano za zlouporabu sredstava iz fondova EU-a namijenjenih izgradnji novog pogona za proizvodnju briketa. Kako je i ranije objavljeno, iz rezultata istrage proizlazi da je jedno od optuženih trgovačkih društva bilo korisnik subvencije EU za građevinski projekt sufinanciran sredstvima Europskih strukturnih i investicijskih fondova (ESIF) te instrumenta Pomoć za oporavak za koheziju i europska područja (REACT-EU) u okviru plana Next Generation EU. Ta su sredstva bila predviđena za izgradnju novog postrojenja za proizvodnju briketa, s prihvatljivim troškovima nabave od 945.858 eura, od čega je 45% sredstava bilo bespovratno. Iz prikupljenih dokaza tako proizlazi da su dvojica optuženika, direktor i stvarni voditelj poslovanja optuženog trgovačkog društva, zajedno s drugim optuženicima dogovorili kupoprodaju rabljenih strojeva za proizvodnju briketa, suprotno uvjetima sufinanciranja, i to po višestruko većim cijenama od njihove stvarne vrijednosti. Kako bi realizirali dogovoreno, druga dvojica optuženika su putem svojih trgovačkih društva nabavili rabljene strojeve od trgovačkog društva iz Republike Srbije za iznos od 398.866,00 eura. Potom su ih, prikrivajući činjenicu da se radi o rabljenim strojevima, kao nove prodali optuženom trgovačkom društvu za iznos od 935.297,63 eura. Nakon toga su prva dvojica optuženika zatražili 420.883,93 eura bespovratnih sredstava od Hrvatske agencije za malo gospodarstvo, inovacije i investicije, (HAMAG-BICRO), neistinito prikazavši da je nabavljena nova oprema po tržišnim cijenama. Agencija je tada izvršila prvu isplatu u iznosu od 285.904,84 eura. Međutim, zbog uočenih nepravilnosti, isplata preostaloga iznosa je odbijena. Na taj je način na štetu EU jednom od optuženih trgovačkih društava pribavljena imovinska u iznosu od 285.904,84 eura, dok je ostalim trgovačkim društvima pribavljena imovinska korist u ukupnom iznosu od 536.431,63 eura, na ime razlike između nabavne i prodajne cijene strojeva. Ako im se utvrdi krivnja, optuženicima prijeti od jedne do deset godina zatvora.   Više   Germany: Searches and arrests in probe into suspected €15.7 million VAT fraud involving mobile phone sales (Luxembourg, 17 September 2026) – The European Public Prosecutor’s Office (EPPO) in Frankfurt am Main (Germany) conducted searches, arrests and asset freezes yesterday in an investigation into suspected large-scale VAT fraud involving the online sale of mobile phones. The investigative measures took place in Austria, Bulgaria, Cyprus and Germany. Four suspects were arrested, including three in Bulgaria and one in Germany. Searches were carried out at business premises and private residences linked to the suspects and the companies allegedly involved in the scheme. The investigative court in Frankfurt am Main issued asset freezing orders worth approximately €20.5 million against two suspects and two companies. In parallel, the competent German authorities in Braunschweig und Berlin are taking measures to recover assets from the companies that sold the mobile phones and from their managers. Bank accounts, mobile phones and luxury watches were seized and €3.3 million were already recovered by one of the suspected companies. At issue is a suspected VAT margin fraud scheme involving new mobile phones sold to consumers in Germany. The VAT margin scheme is a special tax arrangement under which VAT is paid only on the seller’s profit margin rather than on the full sales price. It is intended to prevent double taxation when second-hand goods are resold. Applying this scheme to new goods that do not qualify for it can result in significant losses to public revenues. According to the investigation, the suspects set up a cross-border trading structure involving companies in Bulgaria, Cyprus and Germany in order to enable the unlawful application of the VAT margin scheme to new mobile phones sold online in Germany. The evidence gathered indicates that mobile phones were passed through a chain of companies controlled by the suspects before being sold by German online retailers to end customers. By creating the appearance that the phones qualified for the VAT margin scheme, VAT was calculated only on the sellers’ profit margin instead of on the full value of the phones.. This allowed the phones to be sold at prices below those of competitors complying with tax rules, which generated substantial illicit profits that were distributed through the network of companies involved in the scheme. The investigation further established that the two main suspects, a Bulgarian couple, organised and controlled the companies used in the fraud and applied the unlawful VAT rules across the entire supply chain. It is estimated that the fraudulent scheme caused VAT losses exceeding €15.7 million. The final amount of the damage remains subject to ongoing investigations.   more   17/09/2026   European Public Prosecutor's Office News Follow us    Press release Investigation ‘Moby Dick’: Ringleader and members of criminal syndicate found guilty in €520 million VAT fraud linked to mafia (Luxembourg, 17 September 2026) – Six individuals, including one ringleader, have been convicted by the Court of Milan (Italy) for organising and participating in a transnational criminal association, VAT fraud and money laundering, following an investigation by the European Public Prosecutor’s Office (EPPO) in Milan and Palermo (Italy), code-named ‘Moby Dick’. The judge also ordered the confiscation of over €300 million and confirmed the aggravated circumstances arising from the criminal syndicate’s aiding and abetting of a mafia association and use of mafia methods. These are the most recent convictions in this investigation, following the first convictions announced in February. As previously reported, investigation ‘Moby Dick’ concerns a criminal syndicate responsible for a VAT carousel fraud scheme resulting in €520 million in losses to the EU and national budgets. Between 2020 and 2023, the group issued invoices for the sale of AirPods, laptops and other electronic goods with a total value of more than €1.3 billion. One of the individuals now convicted was one of the ringleaders of the criminal syndicate and had been at large for six months after evading arrest in Prague (Czechia) in November 2024. He surrendered in May 2025 and has remained subject to judicial restrictions since then. Another defendant now convicted was responsible for receiving money from a Camorra clan and investing it in the criminal syndicate, which orchestrated this huge tax evasion scheme. The money channelled into the syndicate by the mafia not only increased its profits but also served to launder its illicit proceeds. “These verdicts confirm what the EPPO has been warning about for years: mafia organisations are investing in VAT fraud as a vehicle to launder their criminal proceeds. They are causing massive damages to national and EU budgets. The fight against VAT fraud must become a priority for the EU and a cornerstone of the new EU antifraud architecture”, said European Chief Prosecutor Laura Kövesi. Prison sentences and over €300 million confiscation On 11 September 2026, the judge for the preliminary hearing at the Court of Milan handed down the convictions in these proceedings, involving six defendants. All had requested to be tried under the abbreviated procedure, benefiting from a reduction in sentence. The six defendants received prison sentences ranging from four years to seven years and two months, following a one-third reduction under the abbreviated procedure. The sentences also included accessory penalties, with some defendants permanently barred from holding public office and legally incapacitated for the duration of their sentences, while others were barred from public office for five years. One defendant was additionally disqualified from operating a commercial enterprise and holding executive positions in companies. In addition, the judge ordered the confiscation of over €300 million in profits deriving fro ...   more   Investigation Money Cat: EPPO conducts searches and arrests in probe into suspected €60 million VAT fraud scheme (Luxembourg, 16 September 2026) – The European Public Prosecutor’s Office (EPPO) in Cologne (Germany) conducted searches and arrests today in an investigation into suspected large-scale VAT fraud involving a criminal organisation trading goods across several EU Member States. Two suspects were arrested and 20 private residences and business premises searched in North Rhine-Westphalia (Germany) and Belgium. During the searches, large amounts of cash, luxury watches, handbags and vehicles worth approximately €300 000 were seized, as well as a loaded firearm. The frozen bank accounts are still being evaluated. At issue is a suspected large-scale VAT fraud scheme involving missing traders and shell companies. Such schemes exploit the VAT exemption applicable to cross-border transactions between EU Member States and rely on networks of companies used to evade the payment of VAT or facilitate the fraudulent deduction or reimbursement of VAT. The EPPO investigation, code-named Money Cat, currently concerns nine suspects believed to have participated in a criminal organisation operating between Germany, France and Belgium. They were active in the trade of goods ranging from protective masks to packaging materials. One of the main suspects, based in Germany, allegedly declared VAT-exempt cross-border supplies to numerous companies in France and Belgium that are suspected of acting as missing traders. At the same time, the suspect is believed to have unlawfully deducted input tax based on invoices issued by companies that allegedly provided no genuine services or products. Investigators suspect that fictitious invoices worth more than €11 million were issued as part of the scheme. The investigation further indicates that substantial amounts of money were transferred through international banking channels before being converted into cash and redistributed through the criminal network. Financial investigations revealed transfers to accounts in several countries, including China and Türkiye. It is estimated that the tax damage linked to the scheme exceeds €60 million. The exact amount remains subject to ongoing investigations.   more   European Public Prosecutor's Office - 11 Avenue John F. Kennedy, Luxembourg, 1855 Luxembourg