Criminal Office of the Financial Administration

What it means

The Criminal Office of the Financial Administration is a unit of the Slovak Financial Administration with the status of a police body. It detects and investigates tax and customs crime, such as carousel VAT fraud, smuggling and illegal trade in excise goods.

Unlike the tax office, which carries out tax audits and assesses tax, the Criminal Office works with the tools of criminal procedure. It can conduct operational activities, secure evidence, question witnesses and run investigations under a prosecutor's supervision.

The office cooperates with the police, prosecutors, customs authorities of other countries and the European Public Prosecutor's Office, which prosecutes serious fraud against the EU budget. It often relies on analysing data from VAT control statements, eKasa and customs systems to uncover suspicious chains of transactions.

How it works in practice

For an ordinary business it is important to know that a suspicion of tax evasion can move from the tax sphere into the criminal one. If the tax office finds signs of a crime during an audit, it files a criminal complaint and the case passes to the Criminal Office or the police.

A company can also become part of an investigation as an unwitting link in a fraudulent chain, for example by buying goods from a supplier that does not pay VAT. Protection lies in vetting business partners, contracts, proof of actual delivery and caution with unusually low prices.

In trade in excise goods such as fuel, alcohol and tobacco, checks focus on the origin of the goods and evidence that duty has been paid. Missing accompanying documents can lead to seizure of the goods and the opening of criminal proceedings.

What to watch out for

Not only the managing director but, under corporate criminal liability, the company itself can be held liable for tax crimes. Penalties include fines, a ban on activities and exclusion from public procurement, all of which can seriously damage a business.

If a company receives a summons or a request for cooperation from the Criminal Office, it should respond promptly and with legal advice. Effective repentance, meaning paying the tax before the court decides, can end criminal liability for some offences, but the conditions are strict.