EU’s Operation Escape Room Uncovers Massive VAT Fraud Network

November 14, 2025

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The Austrian Ministry of Finance released a public notice about the tax investigation codenamed Operation Escape Room, conducted together with the European Public Prosecutor's Office (EPPO) and supported by the WEGA special police unit. The investigation resulted in a house search and three seizure operations at four locations in Vienna.

The Result of the Investigation

The investigation was conducted simultaneously at 39 locations across Poland, Germany, the Netherlands, Belgium, Latvia, and Austria, resulting in eight arrests, with five suspects now under investigation in Austria for cross-border VAT fraud. The investigators determined that the network of fraudsters used hundreds of shell companies, forged documents, and fictitious invoices to conceal the real flow of goods and money, focusing mainly on high-value electronics and mobile communications products.

As announced by the Ministry of Finance, two Austrian companies acted as intermediaries to obscure transactions. However, the VAT fraud is only one part of the investigation, and the investigators suspect money laundering, with profits allegedly transferred through multiple accounts and entities.

Regarding the financial damages, they amount to EUR 47 million in unpaid taxes in Belgium, EUR 14.5 million in the Netherlands, and nearly EUR 80 million in expected money-laundering losses. The Austrian authorities seized substantial documentary and electronic evidence, which is now being analyzed in cooperation with the European Investigation Team.

Conclusion

Given the number of EU countries and the financial damage caused by this fraud, the Operation Escape Room investigation underscores how harmful VAT fraud can be. Moreover, this investigation emphasizes the importance of international cooperation in tackling VAT fraud and related criminal activities.

The outcome of the investigation remains to be seen. Nevertheless, the result instills confidence that the EU will successfully address the growing number of complex VAT fraud schemes, thus protecting the EU single market and ensuring more revenues for state budgets.

Source: Austrian Ministry of Finance

What is Operation Escape Room?

Operation Escape Room is a multinational tax investigation led by the Austrian Ministry of Finance and the European Public Prosecutor’s Office targeting a large VAT fraud network operating across several EU countries.

Which countries took part in the investigation?

The investigation was conducted across Austria, Poland, Germany, the Netherlands, Belgium, and Latvia, with coordinated searches and arrests.

What did investigators discover during Operation Escape Room?

Investigators uncovered a network using hundreds of shell companies, forged documents, and fictitious invoices to hide real transactions involving high-value electronics and mobile communication products.

How much financial damage did the VAT fraud cause?

Authorities reported EUR 47 million in unpaid taxes in Belgium, EUR 14.5 million in the Netherlands, and around EUR 80 million in expected money-laundering losses.

Were any arrests made during the investigation?

Yes, eight arrests were made across the participating countries, and five suspects in Austria are currently under investigation for cross-border VAT fraud.

Why is Operation Escape Room significant for the EU?

he case shows how damaging VAT fraud can be and highlights the importance of international cooperation in detecting, investigating, and preventing complex cross-border tax schemes.

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