Six suspended from VAT department

The police investigation into what is believed to be massive fraud at the VAT department has led to the suspension of at least six employees.

In a curt statement yesterday, the government said that as of Monday, six VAT department employees had been suspended on half pay in line with public service regulations.

It was unclear whether the six employees were among those arrested on Friday when the police raided the VAT offices in Birkirkara, where they also confiscated a number of computers. At least eight employees were detained although none occupied a senior position.

A Ministry of Finance spokesman said he did not have any information to add to the statement.

Millions of euros are believed to have been lost as a result of fraudulent practices by VAT department staff going back a number of years. A number of businessmen are also being investigated.

The case could well turn out to be one of the biggest cases of fraud involving a government entity. The figures owed in VAT could rise in the coming weeks because sources said the findings were the "tip of the iceberg".

The Prime Minister said on Sunday that there would be no resignations at the VAT department before the police concluded their investigations.

The wrongdoing came to light after a businessman who had been approached passed on the information to Finance Minister Tonio Fenech last December.