The Relationship between Criminal Organisations and Budget Fraud in Hungary

Abstract

During the years following the regime change, a never experienced wave of crimes swept through Hungary. A new age of organised crime has been opened due to the weight and strength of the fact that an entire organisation stood behind the perpetrators. In this early stage, organised crime was typically associated with high-tax (excise) products and the attainment of unauthorised tax claims and other economic misconduct. Perpetrators could realise a significantly higher profit than they could possible achieve pursuing legal activities. The number of carousel fraud cases have increased at the courts since 2015. Chains of companies issuing and accepting invoices have appeared in these cases causing significant damage for the state budget. Quite often, these issues remained undetected for several year-long periods until they became identified by the investigative authorities. Both prosecution and the court’s final decision convicted these activities as criminal organisations. Based on the experiences of judicial procedures, the criminal organisations are to be dismantled as soon as possible. Hence, the most critical question is how to reduce the time frames dismantling would take?