European police arrested nine suspects in a continent-wide crackdown on a gang of suspected VAT fraudsters who robbed countries of hundreds of millions of euros, Europol said on Tuesday.
Operation Vertigo, run in conjunction with Europe's prosecuting authority Eurojust, saw police to swooping down on suspects in the Netherlands, Germany, the Czech Republic, Poland and other EU countries in the largest operation of its kind.
"The size and scope of this coordinated action... were extraordinary," Europol and Eurojust said in a combined statement issued from their headquarters in The Hague.
"In total, 11 territories were involved," the statement added, saying Operation Vertigo kicked off at 0500 GMT on Tuesday.
The apprehended gang is suspected of so-called "carousel fraud," also called missing trader or VAT fraud, which cost states hundreds of millions of euros in missing revenue every year.
It works on the principle of importing goods VAT-free and then selling them locally charging VAT with the importer dodging the tax it should be paying to the government.
The same goods are then resold and exported, with the gang then reclaiming VAT on it to which it was not entitled, at the taxpayers' expense.
"Damage to the state budget of Germany through this illegally evaded VAT and illegally reimbursed VAT is estimated to be in excess of 100 million euros ($111.9 million), while the Netherlands has suffered losses of at least 30 million euros," a Europol statement said.
Losses in the Czech Republic and Poland are estimated at 10 million euros each, it added.
In order to facilitate the flow of money, the suspected criminals used banking facilities across the globe amounting to "hundreds of millions of euros," the statement added.
Europol said combatting carousel fraud was a priority in Europe's fight against serious and organised crime.
"This action sends a clear message that Europol and its partners are determined to persue criminals involved in organised VAT fraud," Europol's head of operations for serious and organised crime Michael Rauschenbach said.