electronic equipment
The European Public Prosecutor’s Office led a major operation this week that resulted in 17 arrests across eight countries. The Madrid office coordinated the crackdown on a criminal group believed to have originated in Spain, allegedly orchestrating a large-scale VAT fraud worth about 25 million euros through the sale of mobile phones and other electronic devices.
Arrests marked a milestone for the European Public Prosecutor’s Office as it initiated actions in Spain for the first time within this framework. Detainees were referred to the National Court by the originating court, with José Luis Calama, head of Central Investigation Court No. 4, serving as security judge. This information was shared with a Spanish press outlet by legal sources. One of the principal suspects was also apprehended in Milan, Italy, as part of another European Prosecutor’s Office investigation in which more than 40 million euros were implicated.
The operation, conducted under the code name Marengo Rosso, involved 39 data recordings and coordinated actions that led to 17 arrests across several countries including the Czech Republic, Hungary, Italy, Luxembourg, Portugal, Poland, Slovakia, and Spain, all under Madrid’s leadership.
electronic equipment
The accused allegedly exploited VAT exemptions through a carousel fraud scheme designed to exploit cross-border EU transactions. A network of shell companies, operating as fronts in different member states, would trade phones, tablets, computers, and other devices using fictitious invoices to dodge VAT obligations. This structure enabled the rapid movement of goods and profits across borders, masking illegal activity behind seemingly legitimate trade flows.
A chain of front companies purportedly helped claim VAT refunds to which the group may not have been entitled, amplifying illegal gains. The goods were marketed at highly competitive online prices across several markets, with proceeds purportedly laundered and reinvested in high-value real estate across multiple countries, including the Czech Republic, Italy, and Portugal, following established procedures.
Twenty records in Spain
The Spanish phase of the investigation focused on a crime syndicate involved in crimes against the Treasury and money laundering, among other offenses. Nineteen addresses and company headquarters across Madrid, Barcelona, Castellón, Valencia, Valladolid, Alicante, Murcia, Málaga, and Pontevedra were subjected to searches, resulting in 9 arrests and 4 active investigations. Civil Guard agents from the Central Operations Unit (UCO) and Europol personnel collaborated, deploying a mobile office and technical vehicles to Spain to assist in the seizure of evidence, including data from compromised devices and cloning equipment.
Economic crime units, including the UC’s Department of Economic Research and Anti-Corruption, seized a large volume of documents and digital devices connected to the case, indicating a broad network of activities designed to conceal the true scale of the operation and the flow of illicit gains. This coordinated effort highlights the importance of cross-border cooperation in tackling VAT fraud and related financial crimes within the European Union, where tax authorities and law enforcement agencies share information and resources to dismantle complex criminal networks.
The operation demonstrates the ongoing commitment of EU institutions to pursue sophisticated fraud schemes that exploit cross-border trade rules. It also underscores the role of national courts in processing arrests and evidence while maintaining the integrity of judicial proceedings across multiple jurisdictions. The collaboration between national authorities and EU agencies serves as a model for investigating transnational economic crimes and recovering misappropriated funds. Authorities continue to monitor the case as investigations expand and additional arrests or charges may follow, depending on the evolving evidence gathered through ongoing inquiries and data analysis.
Attribution: European Public Prosecutor’s Office reporting via national authorities and related law enforcement partners; Europol and civil guard units contributed to operational support and data collection during the investigations.