Carousel Fraud – A Type Of Trading Fraud

By Author: Salvatore Andrea
Total Articles: 6261
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In the recent times, we have seen many frauds that have unearthed. There are various types of frauds and scams that have shaken every part of the world. Missing Trader Intra-Community fraud or mtic fraud is one among in the list of frauds. The other name of MTIC fraud is carousel fraud. To give you the definition of this fraud is – this is the fraud wherein the VAT or Value Added Tax is stolen by the organized crime gangs from the government.

In this crime the fraudsters move goods from the VAT jurisdiction area to non-VAT jurisdiction area and then they charge VAT from the consumers, which goes into their black money account since they don’t pay the VAT to the government. The name “missing trader” is given as the trader goes missing after committing the fraud. This is becoming a very common crime in the recent times.

As mentioned earlier, the other name of MTIC fraud is carousel fraud. The carousal fraud is even more complex than MTIC fraud. In this fraud, the goods and VAT amount are being ...
... passed on between the companies as well as the jurisdiction. The principle of the carousal fraud is that the goods and VAT keep moving in rounds like that of carousal.

The investigation, law and the punishment for this fraud is different in different countries. To give you an insight, in the UK the crime is investigated by the HM Revenue & Customs. The prosecution and punishment is handed over by Crown Prosecution Service as well as the Crown Office and Procurator Fiscal Service. The cost of the fraud is paid by the government and it is a big loss for the country. Though government is taking measure to curb the crime, it is not 100% successful.