A Euro\u00adpe-wide fraud net\u00adwork ope\u00adra\u00adting in the second-hand car trade has been unco\u00adver\u00aded by the Euro\u00adpean Public Prosecutor\u2019s Office (EPPO) and natio\u00adnal aut\u00adho\u00adri\u00adties. The resul\u00adting los\u00adses amount to around 300 mil\u00adli\u00adon euros. Inves\u00adti\u00adga\u00adti\u00adons led to arrests, sear\u00adches and sei\u00adzu\u00adres in Ger\u00adma\u00adny, the Net\u00adher\u00adlands and Poland.<\/p>\n
The case began in 2021 with a tip-off from the Ita\u00adli\u00adan tax aut\u00adho\u00adri\u00adties to the Fede\u00adral Cen\u00adtral Tax Office. The alle\u00adga\u00adti\u00adon was that tho\u00adse invol\u00adved had pro\u00advi\u00added incom\u00adple\u00adte infor\u00adma\u00adti\u00adon regar\u00adding the purcha\u00adse and resa\u00adle of vehic\u00adles impor\u00adted from Ger\u00adma\u00adny to Ita\u00adly. The M\u00fcns\u00adter Tax Inves\u00adti\u00adga\u00adti\u00adon Unit sub\u00adse\u00adquent\u00adly laun\u00adched an inves\u00adti\u00adga\u00adti\u00adon, which was later taken over by the EUS\u00adtA in Cologne.<\/p>\n
Essen\u00adti\u00adal\u00adly, the suspects abu\u00adsed the so-cal\u00adled \u2018dif\u00adfe\u00adren\u00adti\u00adal taxa\u00adti\u00adon\u2019 sche\u00adme. This VAT pro\u00adce\u00addu\u00adre is actual\u00adly inten\u00added for trad\u00aders who purcha\u00adse second-hand goods from pri\u00adva\u00adte indi\u00advi\u00addu\u00adals and resell them. It pro\u00advi\u00addes that VAT is levied only on the trade mar\u00adgin \u2013 that is, the dif\u00adfe\u00adrence bet\u00adween the purcha\u00adse pri\u00adce and the sel\u00adling pri\u00adce \u2013 and not on the full value of the vehic\u00adle. This signi\u00adfi\u00adcant\u00adly redu\u00adces the tax bur\u00adden and makes the sys\u00adtem attrac\u00adti\u00adve to legi\u00adti\u00adma\u00adte dea\u00adlers. In this case, howe\u00adver, this sche\u00adme was deli\u00adbera\u00adte\u00adly exploi\u00adted to eva\u00adde VAT on final sales in other countries.<\/p>\n
The suspects purcha\u00adsed vehic\u00adles from key figu\u00adres in the net\u00adwork who had alre\u00ada\u00addy been con\u00advic\u00adted, and then sold them as vehic\u00adles sub\u00adject to mar\u00adgin taxa\u00adti\u00adon to car dea\u00adlers in Ger\u00adma\u00adny, the Net\u00adher\u00adlands and Por\u00adtu\u00adgal. This part of the sche\u00adme alo\u00adne resul\u00adted in a tax loss of more than 3.2 mil\u00adli\u00adon euros.<\/p>\n
The enti\u00adre fraud sche\u00adme was acti\u00adve bet\u00adween 2017 and June 2023. The total loss is esti\u00adma\u00adted at around 300 mil\u00adli\u00adon euros. To date, assets worth around 15 mil\u00adli\u00adon euros have been reco\u00adver\u00aded. In the most recent ope\u00adra\u00adti\u00adons, the aut\u00adho\u00adri\u00adties sei\u00adzed, among\u00adst other things, luxu\u00adry vehic\u00adles, high-end wat\u00adches, cash, jewel\u00adlery and pro\u00adper\u00adty with a total value of over 2.5 mil\u00adli\u00adon euros.<\/p>\n
Sin\u00adce the inves\u00adti\u00adga\u00adti\u00adon began, nine peo\u00adp\u00adle have been con\u00advic\u00adted by a final jud\u00adge\u00adment. The pri\u00adson sen\u00adten\u00adces ran\u00adged from two to seven years. In total, more than 70 peo\u00adp\u00adle are suspec\u00adted of having been invol\u00adved in the fraud or of having actively sup\u00adport\u00aded the main perpetrators.<\/p>\n
This case illus\u00adtra\u00adtes how vul\u00adnerable the mar\u00adgin sche\u00adme is to abu\u00adse and the ext\u00adent to which tax aut\u00adho\u00adri\u00adties and public pro\u00adse\u00adcu\u00adtors coope\u00adra\u00adte across bor\u00adders. For car dea\u00adlers and other busi\u00adnesses that trade in second-hand goods and app\u00adly the mar\u00adgin sche\u00adme, this means that accu\u00adra\u00adte docu\u00admen\u00adta\u00adti\u00adon and careful scru\u00adti\u00adny of the sup\u00adp\u00adly chain are not mere for\u00adma\u00adli\u00adties, but a serious com\u00adpli\u00adance issue.<\/p>\n
Anyo\u00adne who purcha\u00adses and resells vehic\u00adles or other second-hand goods under this sche\u00adme should be able to pro\u00advi\u00adde a com\u00adple\u00adte chain of evi\u00addence regar\u00adding the ori\u00adgin of the goods. If the\u00adre are any doubts regar\u00adding the relia\u00adbi\u00adli\u00adty of a sup\u00adpli\u00ader or their eli\u00adgi\u00adbi\u00adli\u00adty for the mar\u00adgin sche\u00adme, tax advice should be sought at an ear\u00adly stage. In cases of suspec\u00adted irre\u00adgu\u00adla\u00adri\u00adties, cri\u00admi\u00adnal tax law may also app\u00adly, which fur\u00adther empha\u00adsi\u00ads\u00ades the importance of careful documentation.<\/p>\n
Source:<\/strong> North Rhi\u00adne-West\u00adpha\u00adlia Tax Aut\u00adho\u00adri\u00adty, press release dated 10 July 2026<\/p>\n