A recycling company from Bucharest built a network of nine ghost companies to evade 18 million lei from the budget. Luxury cars and cash withdrawals helped unravel the scheme.
Packaging waste recycling is, in theory, a sector with a civic mission — collect, process, reduce environmental impact.
In practice, for at least one company from Bucharest, it also functioned as a mechanism to evade 18.41 million lei from the state budget. Inspectors of the Directorate General Antifraud Fiscal (DGAF) within ANAF identified and dismantled the scheme, after an investigation that covered the period 2023-2025.
The verified company – with apparently legitimate activity and receipts of over 53.25 million lei in the three years – entered into the accounting fictitious invoices issued by a network of nine companies without any real economic activity. Purpose: artificial reduction of taxable profit and illegal deduction of VAT, including through the abusive application of the reverse charge mechanism.
How the mechanism worked: Anatomy of the scheme
The main company collects real money from legitimate beneficiaries for recycling services.
He entered fictitious invoices from the nine shell companies into the accounting, simulating purchases of waste and sorting or dismantling services.
Fictitious expenses reduced taxable profit; The illegally deducted VAT reduces the obligations towards the state.
The money transferred to the phantom companies was withdrawn in cash through the accounts of natural persons and re-entered, partially, into the personal patrimony of the administrators.
The companies in the network had a common profile, almost cartoonish in its simplicity: they had no employees, did not operate at the declared addresses, some did not even have bank accounts. Six of the nine had been established in 2024 and declared inactive in 2025 – a life cycle of less than two years, precisely calibrated to the time required to issue invoices.
“The firms operated exclusively in relation to the verified beneficiary” – an indication that they were not independent commercial entities but accounting instruments.
The documents that betrayed
The investigators identified several layers of fictitiousness. The minutes of the provision of services assigned work to people who had never had employment relations with the respective companies. The mandatory technical documents regarding waste processing were missing. The quantities of incoming waste did not match those processed. There were no equipment or computer applications necessary for the declared activities.
It is the classic combination of a ghost company: headquarters address that does not correspond to reality, documents that exist on paper but have no physical counterpart, and human and material logistics that simply do not exist.
Money and its destination
Part of the embezzled money ended up in the administrators' personal patrimony – over 2 million lei withdrawn in cash or used directly for personal expenses. The largest amount – 10.43 million lei – was transferred in 2024-2025 to one of the fictitious supplier companies, from where it was concealed through successive withdrawals from the accounts of some natural persons.
The element that gave the investigation a concrete dimension, hard to ignore: the purchase of a luxury car worth 487,500 euros, financed from the funds derived from the criminal activity. In a tax investigation dominated by abstract figures and accounting flows, a car worth almost half a million euros functions as tangible evidence.
Security measures
Prior to the completion of the control, the inspectors instituted the seizure of the company's main assets: a 1,065 square meter urban plot in Bucharest, two cars and the company's bank accounts. The preventive measure aims to block any attempt to transfer the assets before the recovery of the damage.
DGAF announced that it will notify the criminal prosecution authorities. Tax evasion on the scale identified – 18.41 million lei – exceeds the thresholds that trigger criminal prosecution in Romania, where the tax evasion law provides prison sentences of between two and eight years, with higher limits in the case of large damages.
A high-risk sector
Waste recycling is one of the areas systematically monitored by ANAF as a sector with high fiscal risk. The reverse charge mechanism – designed to simplify VAT in certain commercial transactions – has been abused in several similar investigations, precisely because it creates a temporal and documentary gap that can be more easily manipulated than the regular flow of VAT collected and deducted.
The case in Bucharest is not unique. It illustrates a well-documented typology of fraud: an operating firm with real turnover, surrounded by a constellation of satellite entities created solely to erode the tax base. The apparent complexity of the network—nine firms, flows through individual accounts, elaborate documents—served a relatively simple accounting purpose: to turn real profit into fictitious expenses.
