A Danish citizen who is suspected of being responsible for a fraudulent VAT carousel was arrested in Kenya after a six-month escape. According to a press release from the State Office of Criminal Investigation of North Rhine-Westphalia (LKA NRW), information from his relatives led to the man’s arrest.
The 50-year-old suspect had fled to the African country months ago and had managed to hide there for six months before being arrested at Frankfurt Airport in the middle of preparations for a family vacation. His relatives had put investigators on the right track.
An arranged meeting with his wife, who was following him for a vacation, finally offered the investigating authorities the right time and place to arrest the suspect.
After his arrest in Kenya and a week in custody, the suspect was transferred to Germany and is currently in German custody. The European arrest warrant was executed by the authorities of the LKA NRW at the request of the EPPO.
The European Public Prosecutor’s Office was created in June 2021 to combat crimes that harm the EU’s financial interests. Since its creation, the Public Prosecutor’s Office has been allowed to investigate directly in all 23 participating Member States and to prosecute perpetrators before national criminal courts.
The Dane is accused of being the mastermind of a criminal organization and of organizing a fraudulent VAT carousel worth 85 million euros, the statement said.
Most of the money is said to have been earned through illegal international trade in consumer electronics. “EU regulations for cross-border transactions are said to have been circumvented through a complex system,” the LKA NRW reports.
A VAT carousel is a complex form of tax evasion that involves exploiting the complex VAT system within the European Union to avoid paying taxes.
The fraud “exploits the mechanisms of VAT collection and refund to obtain illicit financial advantages by exploiting the peculiarities of intra-Community trade,” explains the Haider law firm on its website.
Some of the illegal transactions were carried out in North Rhine-Westphalia, which is why the LKA NRW played a key role in the investigation. According to authorities, the Dane’s escape began after a raid on the criminal gang in Denmark, Düsseldorf and Dortmund in November 2023. Another suspected mastermind of the fraudulent system was also arrested during this raid.
According to the authorities’ report, the arrest was made through close cooperation between European and African security authorities, including the European Public Prosecutor’s Office (EPPO), Danish security forces and the Nuremberg tax investigation office.
A similar fraud scandal occurred in Germany in 2019. In an investigation into a multi-million dollar VAT evasion, the Attorney General’s Office charged a high-ranking former employee of Deutsche Bank.
The then 48-year-old Austrian was accused of facilitating an external fraudulent VAT carousel in 2009 and 2010. Deutsche Bank acted as an intermediary in the illegal ring trade in CO2 emission certificates and thus made tax fraud amounting to 145 million euros possible.
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