EU Alleges Lube Smuggling in Italy

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EU Alleges Lube Smuggling in Italy
Photo courtesy of European Public Prosecutor's Office

The European Union’s public prosecution office last week announced an investigation, dubbed “Greasy Hands,” into an international criminal ring accused of selling imported motor oils in the Italian market while systematically evading value-added taxes.

The European Public Prosecutor’s Office, known as EPPO, disclosed in a May 7 news release that the scheme – which operated between 2017 and 2023 – involved illegal import of automotive lubricants and tax evasion, causing a loss of over €15 million (U.S. $16 million) to Italy’s national budget. VAT is a tax on the sale of goods and services that is applied at each stage of production or distribution.

“Searches and judicial measures were executed today by the Italian Financial Police in the provinces of Bari, Campobasso, Foggia, Matera and the regions of Rome, Trieste and Turin,” the public prosecutor’s office said in the May 7 news release.

The criminal activities included international collaborators from Latvia, Belgium, the Czech Republic, Estonia, Hungary, Poland, Slovakia, and Slovenia.

“Judicial measures have been taken against 14 individuals, including the suspected ringleaders,” the public prosecutor’s office noted. “Eight of the suspects will remain in pre-trial detention, and six have been placed under house arrest.” In addition, a freezing order of €15,4 million was executed against the suspects.

Further allegations against the criminal ring include counterfeiting motor oil brands and engaging in money laundering activities.

During the searches, over 470 metric tons of finished lubricants were seized, with canine units specialized in detecting currency also participating in the operations.

The public prosecutor’s office’s news release detailed that the individuals involved imported and sold large quantities of automotive lubricants in Italy, employing multiple strategies to evade value-added tax and excise duty payments. These strategies included using forged transportation documents and establishing a network of shell companies.

The investigation also uncovered that a company operating in the Matera area, a central hub for motor oil sales in central and southern Italy, sourced products from the criminal network, concealing over €52 million in profits from tax authorities.