Last year the National Bureau of Investigation (NBI) began investigating two men under suspicion of paying some 150 construction workers without paying taxes. The Bureau now says that their enquiries show the grey economy to be far more extensive than supposed.
"It has come to light that the number of people in the local construction business working or having worked undeclared is closer to 700," says NBI detective Janne Järvinen. "This is the biggest grey economy pre-trial investigation in 10 years."
Police are investigating the case as aggravated tax fraud and aggravated accounting offenses. A new addition to the suspicion list is aggravated money laundering, due to the fact that the men allegedly hid the financial gains they made through their criminal activities.
Undeclared work used across capital region
The companies under investigation began their operations in late 2013, and the police stings were conducted one year ago. Cash-in-hand workforces were found in Espoo, Helsinki and Eastern Uusimaa.
"The two suspects had not signed contracts with the city but worked as a subcontractor. Tax-paying subcontractors simply cannot compete on the free market with one that does not pay taxes," Järvinen says.
The NBI estimates that some seven million euros have been paid out to workers employed without tax being paid. The firms also dodged some 4.6 million euros' worth of taxes.
Some 40 people in total are under suspicion for the fraud crimes mentioned. Police have conducted interrogations relating to the case abroad as well. The pre-trial investigation will be finished next year at the earliest.
_EDIT: This story has been edited to change references to 'illegal workers' to more accurately describe the nature of the suspicions. _