Czech firms in nearly CZK 5 billion VAT fraud, EPPO charges four

The European Public Prosecutor's Office (EPPO) has charged four participants in a large-scale tax fraud in which Czech companies were involved. The damage in the case amounts to almost five billion crowns, and according to EPPO it is one of the largest VAT fraud cases in Czechia.

The criminal scheme was uncovered by investigators during the “Záblesk” operation, with the participation of the National Organized Crime Agency (NCOZ). According to EPPO, the investigation concerned a group of people suspected of taking part in a long-running scheme: electronics were imported from third countries, including Hong Kong, the United Arab Emirates and the United States, into the European Union through companies with offices in Czechia.

The Czech firms then declared deliveries of the goods within the EU to companies registered in Hungary, Poland and Slovakia. “They did not, however, conduct any real economic activity, did not receive the goods and made no payments,” EPPO said in its statement. In reality, the goods were sent to warehouses near the Ukrainian border. “There they were picked up by other persons, who disposed of them further without paying the VAT due.”

What penalties they face. The four suspects are charged with serious tax offenses. If convicted, they face up to ten years in prison and confiscation of property.

Those who choose to enter a plea agreement with the prosecutor face five to six years in prison and confiscation of property in three cases, while one person may receive a suspended sentence. “In addition, all the accused face a ten-year ban on conducting business,” EPPO notes.

Source: novinky.cz