This April, the Finance Police Department of the State Revenue Service (hereinafter — “SRS”) stopped two interrelated organised groups of persons, which, evading tax payments, caused losses of at least EUR 356,246 to the State budget.
During the investigation, it was established that both groups provided their services to a very wide range of beneficiaries: actually operating companies that operated in the field of wholesale trading in furniture and electrical appliances, in the field of security, in the field of crediting, in specialised and non-specialised retail stores.
To reduce the amount of VAT to be paid into the State budget and to legalise criminally acquired funds, beneficiaries included transactions with shell companies, which had not actually taken place, in their VAT declarations, thus reducing their amount of enterprise income tax to be paid into the State budget. So that it was more difficult for control authorities to establish the commission of criminal offences, transactions, which did not exceed the amount of EUR 1,430, were used. Thus, VAT declarations submitted to SRS did not reflect the names of these shell companies, wherewith it was initially impossible to identify the range of involved companies.
We draw attention to the fact that any criminal offence committed in any area of State revenue results in a negative impact on the national economy of Latvia and economy in general. Companies, which, using services provided by organised criminal groups, include transactions that had not actually taken place in their VAT declarations, can offer goods and services for lower prices, which do not promote fair competition among entrepreneurs of a particular sector.
During 40 searches in carefully hidden offices and warehouses in Riga and Riga District, stamps, internet-banking code cards, code calculators, and documentation of shell companies, as well as other important material evidence were seized. The counter-terrorism unit Omega was involved in ensuring criminal-procedural activities.
Currently, within the framework of pre-trial investigation, nine persons were assigned the status of a suspect; six of these persons were delivered to the temporary detention facility for 48 hours. All the said criminal-procedural activities were performed by investigators of the SRS Finance Police Department within the framework of the criminal proceedings initiated in February 2017 according to Section 218 Paragraph 3 and Section 195 Paragraph 3 of the Criminal Law regarding evasion of tax payments and money laundering on a large scale.
For the purposes of the investigation, currently no further information is provided.
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