Grand Theft Europe investigation wins European press prize

A cross border investigation involving more than 30 countries uncovering the largest ongoing tax fraud in Europe has won a prestigious prize in the annual German-French Journalist Awards.

Titled ‘Grand Theft Europe’, the investigation was led by non-profit newsroom CORRECTIV together with 33 media partners across the EU. The Shift formed part of this investigation, which followed the path of the stolen money, revealing a Europe-wide racket through VAT carousels that also made use of companies registered in Malta.

Appearing on the Malta Financial Services Authority’s register as “inactive”, these companies were found to be at the centre of illicit trades worth millions of euro. The Shift’s investigation revealed Malta’s role in what is known as ‘carousel fraud’.

The investigative project won the multimedia category in the German-French Journalist Awards, which serves to distinguish authors or editorial teams whose work has contributed to a better understanding of Franco-German and European relations in a unique manner.

The Shift collaborated in this investigation, which revealed that Maltese entities involved in these fraud schemes were allowing criminals to steal taxpayers’ money from other EU member states, contributing to their VAT gaps.

Referred to as Missing Trader Intra Community (MTIC) Fraud, the scam is creating a black hole, conservatively estimated at around €50 billion per year, stolen by criminal gangs from people’s taxes and used to finance terrorism, the mafia and other illicit activity, according to the European Commission.

VAT carousel fraud is often referred to as ‘a crime against Europe itself’ because fraudsters abuse of the internal market and cross-border exemptions from VAT to set up cross-border webs of companies to import and export goods, rack up significant amounts of VAT, never pay it, and later claim a refund through another company.

Fraudsters may even re-import those same goods and run them through the import/export network (carousel) again, multiplying the damage to the taxman.

In a video message, DFJP chairman Thomas Kleist praised the quality of this year’s submissions. “The work of the quality media is and remains invaluable for Franco-German relations and coexistence in Europe.” This also applied in particular in times of crisis, because the coronavirus pandemic showed professional journalism was the best way to fight false information.

Meanwhile, French ambassador to Berlin Anne-Marie Descôtes spoke about the dangers and threats faced by investigative journalists and pointed out that the global fight against these was one of the greatest challenges on an international level, According to Reporters Without Borders, there are 389 journalists in custody worldwide and 49 were killed last year.

There are several categories of awards: video, audio, text contribution, multimedia and young talent as well as a separate award to a personality or organisation that has rendered outstanding services to Franco-German and European unification. The ceremony was due to take place on 25 June but, instead, was held virtually due to the coronavirus pandemic but is expected to be held next year.

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