Police in Finland suspect three Finnish nationals and one Estonian of defrauding the Finnish state of some €4.6 million in taxes in the construction business. While there are some 20 suspects involved in total, these four individuals are believed to have played a central role in the scheme.
The police announced on Friday that its investigation had concluded, and that it had centred around two companies that employed primarily Estonians.
At the time when the alleged offences were committed, the two primary suspects had been prohibited from engaging in business in connection with prior economic crimes.
The charges centred mainly around serious tax fraud, serious pension insurance contributions-related fraud as well as serious accounting violations. It is also suspected that waste was illegally exported to Estonia.
"This is believed to be the biggest case of shadow business of the past decade," said lead investigator Janne Järvinen.
The companies in question were active in the Helsinki area, and according to the police, the offences in question were committed between 2013 and 2015, during which the companies posted a total turnover of some €10 million.
Both businesses were closed under bankruptcy proceedings around 2016-2017, according to the Finnish officer.
Police in Finland suspect that the companies left all taxes and social security contributions unpaid on their employees, as a result of which the state lost €4.6 million in tax revenue, and €1.3 million in pension contributions were never made.
The companies performed simpler jobs as subcontractors in the construction of kindergartens, schools and blocks of flats.
Thus far, police have identified 350 people who worked for the two companies in question, however it is suspected that another more than 300 workers whom the police have been unable to identify may have performed maintenance work for them as well.
The workers are believed to have been paid over €6 million in envelope wages.
Not all envelope wages
Unlike in similar, previously investigated cases, not all wages were paid in cash. Some employees were paid wages with taxes and social security contributions withheld, but the withheld amounts never reached their intended destinations.
According to Mr Järvinen, it is possible that part of the criminal proceeds were hidden abroad.
"It is typical in such cases that the activity takes place in Finland, but those responsible have a life of their own somewhere else, such as in Spain, Turkey, or Asia," he added.
Editor: Aili Vahtla