Tartu Mill accused of value-added tax fraud
The South district prosecutor’s office is charging milling company AS Tartu Mill of having submitted misleading data, which led to the state missing out on €1.23m in value-added tax payments.
According to the charges, AS Tartu Mill submitted misleading data between January 2012 and September 2013. The company’s then-procurement manager is accused of having organized the submission of misleading data with the help of a criminal organization.
The evidence collected in the investigation suggests that the eight members of this organization used more than 30 letterbox companies to show transactions that in reality never took place, the prosecutor’s spokesman, Urmas Glaase, told ERR on Tuesday.
For these forged transactions the group then presented invoices based on which money was transferred to the letterbox companies. This way they hid the real transactions taking place between AS Tartu Mill and grain sellers. According to the charges, the money embezzled this way was then kicked back to the members of the group, the purchase manager among them.
The Tartu county court found five of the group’s members guilty already in a settlement in 2014. According to prosecutor Marek Vahing, who headed the investigation preceding the settlement, the case shows that there is a lot of room for development in the business culture of the Estonian agricultural sector.
“The accused wouldn’t have had an opportunity to commit fraud and work dishonestly if there hadn’t been grain sellers that accept this kind of behavior,” Vahing said. He expressed hope that the case wouldn’t create a feeling of security in the sector, but rather that it worked to confirm the honest motives of all those who were running their businesses properly.
According to AS Tartu Mill’s legal advisor, Ivo Raudjärv, the case involves a former employee of the company, not the company itself. The investigation hadn’t showed any involvement of the company on the whole or its management, Raudjärv insisted, and hadn’t profited from the scheme either. On the contrary, the company had done its utmost to help the investigators.
The company didn’t recognize the accusations as fair, and would contest them in court, Raudjärv said, adding that the matter had already damaged AS Tartu Mill’s reputation as well as its profits.