A €300 million fraud involving used mobile phones has been dismantled in 19 European countries.
An operation by the European Public Prosecutor’s Office (EPPO) dismantled an alleged criminal network suspected of selling more than one million used mobile phones in 19 European countries, causing losses that could reach 300 million euros for consumers.
The operation, named Troja, involved approximately 1,770 agents from police, tax, and customs authorities and led to more than 160 searches in 19 European countries. Seven people were arrested, including alleged leaders of the organization.
According to the EPPO, the network operated through an international structure that extended from Hong Kong and the United Arab Emirates to several European countries and e-commerce platforms. Investigators suspect the group used shell companies to develop a scheme related to VAT payments and market equipment as new when it was actually built from used components.
Mobile phones were assembled using used components.
According to the investigation, the mobile phones were assembled from used components in Hong Kong and the United Arab Emirates. After being prepared, the devices were cleaned and repackaged before being shipped to the Netherlands.
From there, the devices were sent to warehouses in Germany, where they were subsequently put up for sale through e-commerce platforms in various European Union countries.
The European Public Prosecutor’s Office suspects that the network managed to place more than one million devices on the market through this circuit, presenting the mobile phones to buyers as if they were new.
The investigation points to a transnational operation, with different stages of the activity spread across various countries and continents.
Shell companies allegedly used to circumvent VAT.
One of the central components of the alleged fraud is related to sales taxation. According to the EPPO, the organization used shell companies located in Austria, Bulgaria, Germany, the Netherlands, and Switzerland to benefit from a VAT regime intended for second-hand goods.
In addition to the tax component, the investigation seeks to determine the impact of the operation on consumers. EPPO estimates that losses could reach 300 million euros.
The scale of the investigated operation is reflected in the number of devices involved: more than one million mobile phones are believed to have been sold through the network.
The devices were presented as new despite, according to investigators, having been assembled using used components, subsequently cleaned and repackaged before reaching the market.
Over 10,000 pieces of equipment seized in Germany.
During operations carried out by the authorities, thousands of pieces of equipment were seized.
In a warehouse located in Krefeld, in western Germany, authorities reportedly found between 10,000 and 15,000 devices, according to information released by WELT.
The operation involved a significant mobilization of resources. Approximately 1,770 police, tax, and customs agents participated in the actions coordinated by the European Public Prosecutor’s Office, which resulted in more than 160 searches carried out in 19 European countries.
Seven people were arrested during the operation, including individuals whom authorities consider to be alleged leaders of the organization under investigation.
The investigation began following a warning from OLAF.
The searches carried out as part of Operation Troja follow a previous investigation by the European Anti-Fraud Office (OLAF).
The authorities involved in the operation are now investigating several suspicions related to the network’s activities. Among the crimes under investigation are smuggling, trademark infringement, and participation in a criminal organization.
The investigation thus seeks to clarify not only the extent of the alleged tax fraud, but also the origin of the equipment, how it was introduced into the commercial circuit, and the role played by the different companies and individuals involved.