This is not a classic case of tax evasion involving fake invoices and manipulated company books. The case currently in the hands of the judiciary describes a multi-layered mechanism that allegedly combined VAT fraud, shell companies, money laundering, and the circulation of revenues that may have originated from nightlife-related activities, such as illegal gambling clubs and providing protection services to brothels.

The case file, which includes dozens of defendants, maps a network of companies that caused enormous damage to the Greek State. According to the investigation, the turnover of suspicious transactions reaches €84.5 million, while the loss from unpaid VAT alone is estimated at at least €20.3 million. However, what turns the case from a “dry” financial fraud into a case with characteristics of organized crime is the explicit reference by judicial authorities to possible laundering of proceeds from “protection services to brothels and illegal gambling clubs”.

At the heart of the case lies the so-called “VAT carousel” mechanism, a practice that has concerned several European countries and is often used in large-scale financial crime cases. According to the file, the companies involved carried out continuous buy-and-sell transactions among themselves, issuing invoices and transferring VAT from one to another. Along the chain, the tax obligation ended up in companies with no real activity, the so-called “shell companies”, which either disappeared or left behind huge debts to the State.

Triangular transactions
The network allegedly used fake invoices, false tax declarations, over-invoicing and triangular transactions, as well as companies created exclusively to accumulate debts and then disappear. In this way, according to the authorities, those involved not only avoided paying VAT but in some cases also managed to obtain tax refunds from the State.

According to the investigative order, key members of the organization allegedly created, between 2020 and 2025, a network of companies acting either as intermediate links or final recipients of tax obligations. The case file refers to “visible and hidden partners”, as well as companies registered in the names of peripheral members or nominal owners who were not the real operators. This structure allowed the main actors to move large sums of money without appearing directly in all corporate layers.

The most important part of the case concerns the investigation of nightlife-related activity. Judicial authorities describe that part of the suspected illicit proceeds may be linked to “protection services to brothels and illegal gambling clubs”. The use of multiple companies and continuous transfers of money from account to account create a complex picture that makes it difficult to trace the original source of funds. Of particular interest is also the reference to public works. Although no specific project or public authority is named so far, judicial authorities note that the network’s practices created “conditions of unfair competition” in relevant tender processes.

Findings
The companies at the center of the case were active, according to the file and the report of the Anti-Money Laundering Authority, mainly in construction, telecommunications, catering and security services. According to the findings, some businesses appeared to have strong commercial activity, without having the corresponding real infrastructure, staff, or financial capacity to justify the scale of their transactions.

In one case, invoices and bank payments exceeding €1.3 million appeared for materials allegedly transported by specific trucks. However, when authorities checked the route, it emerged that the company supposedly selling the materials had no real headquarters, no staff, and no infrastructure for such activity, and crucially, no declared suppliers from which it could have purchased those materials to resell them. The owners of the trucks listed in the shipping documents told authorities they had no connection to the companies involved, had not issued transport documents, had no contracts, and never used their vehicles for the stated transports.

A similar picture emerged in another case where another company in the same network appeared to sell technical materials worth over €300,000, later reduced to about €117,000 after credit invoices. There too, inspectors found the same signs: lack of real activity, absence of staff and premises, no suppliers justifying the sales, no contracts between companies, and use of a third-party truck company that also denied any involvement.