Brussels, 23/04/2008 (Agence Europe) - A system of fraud consisting of claiming for EC agricultural subsidies for over 900,000 tons of non-existing raw tobacco has been discovered by the Italian Carabinieri police force, says a press release from the European Anti-Fraud Office (OLAF) on 23 April. More specifically, two main fraud schemes have been discovered. In the first, shipments to foreign companies were fabricated in order to conceal from the Italian control bodies that the raw tobacco did not exist and to avoid paying value added tax. In the second scheme, “tobacco carousels” were created, with producer A taking tobacco to the processor who returned it to producer B who, again, brought the same tobacco to the processor and so on. EC funds were illegally claimed for all transactions. The investigations carried out by the Carabinieri have shown that findings producers, processors and transport companies alike were involved in this attempted fraud. OLAF contributed to the detection of the scheme by carrying out on-the-spot checks in Luxembourg, the Netherlands, France, Austria and Romania. There are currently 80 individuals under investigation by the Italian judicial authorities in the context of this operation named “Ghost Tobacco”. The illegally claimed Community funds are to be recovered and administrative fines of around €20 million have been imposed. The case is with the public prosecutor's office (Procura della Repubblica) in Perugia. (O.L.)