European Suspect in Ksh Ksh11 Billion VAT Fraud Arrested in Kenya

A caucasian man in handcuffs
A caucasian man in handcuffs

An international tax fraud suspect, a Danish citizen, was arrested in Kenya while hiding from European authorities, which had accused him of being a ringleader of Ksh11 billion (€85 million) tax fraud.

In a statement, the European Public Prosecutor's Office (EPPO) announced that the suspect was arrested after a multi-agency team featuring law enforcement officers from different agencies mounted a 6-month operation code-named Goliath.

Following the investigations which were aided by the Directorate of Criminal Investigations (DCI), the suspect was apprehended on May 23, in Nairobi.

"After a six-month surveillance undertaking, the EPPO was able to locate and arrest the suspect in Nairobi, on 23 May 2024, with the support of the Danish authorities, Germany’s Federal Criminal Police Office (Bundeskriminalamt: BKA) and Germany’s State Criminal Police Office of North Rhine-Westphalia (Landeskriminalamt Nordrhein-Westfalen)," a statement issued by the European office read in part.

Directorate of Criminal Investigation Headquarters in Kiambu.
Directorate of Criminal Investigation Headquarters in Kiambu.
Directorate of Criminal Investigations

According to EPPO's statement, the suspect was subsequently deported on June 5 and taken into custody at the airport in Frankfurt, Germany at EPPO's request, under a European Arrest Warrant.

The suspect was wanted in connection with a criminal organisation, active in the international trade of consumer electronics.

Further details provided by the EPPO state that the suspect alongside his accomplices were suspected of evading tax by means of a VAT carousel fraud – a complex criminal scheme that takes advantage of EU rules on cross-border transactions between its Member States, as these are exempt from value-added tax.

According to the investigation, the suspects established companies in Germany and other EU Member States, as well as in non-EU countries, in order to trade the goods through a fraudulent chain of fictitious traders – who would vanish without fulfilling their tax obligations.

Other companies in the fraudulent chain would subsequently claim VAT reimbursements from the national tax authorities.

The case is still ongoing  where other suspects in the case were apprehended.  

This follows a case where on May 19, two foreign nationals and a Kenyan were arrested for suspected involvement in drug trafficking.

During their arrest, the three who were in a hideout in Kasarani were found in possession of Cocaine, Heroin and Methamphetamine, valued at Ksh1.3 Million.

The three were taken into custody pending their presentation in court.

A man's hand cuffed inside a police cell
A man handcuffed inside a police cell
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