**Cyprus Plays No Role in European VAT Fraud Investigation**
Cyprus has confirmed that it is not implicated in an ongoing European investigation into VAT fraud, apart from providing information as requested. According to reports from the Cyprus News Agency, sources familiar with the situation indicated that Cypriot authorities have cooperated with the investigation solely within the framework established by the European Public Prosecutor's Office (EPPO), which coordinates efforts among EU member states.
The Cypriot police have not engaged in any investigations on the island related to this probe, nor have they conducted any interrogations or investigative measures. The cooperation from Cyprus has been limited to the exchange of information, and while no direct involvement has been reported, sources did not dismiss the possibility of future requests for assistance from European authorities.
The investigation, which has been underway for nearly a year, is focused on a suspected VAT carousel fraud scheme involving the trade of small electronic goods and the laundering of criminal proceeds. Recently, the EPPO office in Athens conducted searches and seizures at multiple locations in Attica and Kastoria as part of this investigation.
The VAT carousel fraud scheme exploits the VAT exemption that applies to cross-border transactions within the EU. Evidence gathered thus far suggests that between 2021 and 2025, a network of companies established in Bulgaria, Cyprus, the Czech Republic, and Greece was involved in distributing electronic goods across the EU while evading VAT obligations. This operation allegedly involved a series of so-called "missing traders"—companies created specifically to avoid paying VAT and to facilitate fraudulent VAT reimbursements.
The investigation has uncovered significant financial implications, with estimated losses of at least €46.9 million to EU and Greek budgets due to unpaid VAT. Additionally, investigators have identified a further €24.2 million that was either not paid or incorrectly declared.
In a notable development, the investigation led to the freezing of cryptocurrencies valued at approximately €900,000, alongside other digital assets totaling around €4.5 million. This action represents the largest seizure of digital assets ever executed at a national level in Greece. Furthermore, freezing orders have been placed on 88 real estate properties, with an estimated worth exceeding €4.5 million, as well as multiple bank accounts linked to the suspects.
The EPPO, which is the independent public prosecution office of the European Union, is tasked with investigating and prosecuting crimes that affect the financial interests of the EU. The ongoing VAT fraud investigation underscores the collaborative efforts among EU member states to combat financial crimes and protect the integrity of the EU's financial systems.
As the investigation continues, it remains to be seen whether Cyprus will play a more active role in the proceedings. For now, the island's authorities maintain that their involvement has been limited to providing information as part of their commitment to cooperate with European judicial mechanisms.