Three plead guilty in Admiral 2.0 €297M laundering case

admiral money laundering eppo tax evasion

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The Admiral 2.0 investigation is one of the largest recent European money laundering cases, highlighting how organized criminal networks use cross-border fraud and sophisticated laundering structures to attack the financial interests of multiple states. What began as a seemingly isolated tax evasion case in Latvia rapidly evolved into a multinational scandal, implicating hundreds of companies and exposing vulnerabilities in Europe’s anti-money laundering framework. At the center lies a scheme valued at nearly €297 million, blending tax fraud with illicit flows tied to drugs, cybercrime, and fraudulent investments.

Money Laundering in the Admiral 2.0 Investigation

The Admiral 2.0 case demonstrates how money laundering and tax evasion can be deeply intertwined. The ringleaders and their associates created complex networks of shell companies across multiple jurisdictions, disguising the origin of revenues generated through fraudulent sales of consumer electronics. By cycling funds through over 400 suspected entities, they sought to erase the illicit nature of the money, layering transactions to confuse investigators and create the appearance of legitimacy.

Investigators uncovered that proceeds were not only linked to tax fraud but also used to launder money from drug trafficking and cybercrime, reinforcing the reality that laundering schemes rarely exist in isolation. Criminals exploit the same infrastructures to disguise funds regardless of whether they originate from smuggling, narcotics, digital fraud, or tax offenses.

The laundering activities were structured to exploit cross-border vulnerabilities. Latvia’s role as a jurisdiction of prosecution underlined its importance as a logistical and financial hub, but the damages were suffered across Austria, France, Germany, Italy, and Spain. The European Public Prosecutor’s Office coordinated actions across these states, with national revenue authorities formally recognized as victims, a rare precedent in EU criminal law proceedings.

Confiscated assets included luxury watches, significant amounts of cash, cryptocurrency holdings, and properties—illustrating the variety of channels used to absorb illicit wealth. Cryptocurrency wallets were particularly relevant, signaling a shift in laundering preferences where digital assets supplement traditional cash-heavy operations.

The plea agreements of three defendants, with punishments including prison terms and fines exceeding €1 million, are only the beginning. The ringleader faces possible sentences of up to 12 years for laundering offenses, reflecting the severity of the crimes.

The Mechanics of Fraudulent Schemes

The fraudulent sales of consumer electronics formed the backbone of the Admiral 2.0 structure. These goods, often traded across borders with manipulated invoices, enabled criminals to artificially inflate or suppress values, generating tax refunds and profits from missing trader fraud. Such schemes, sometimes referred to as carousel frauds, are notorious within the EU for exploiting VAT frameworks.

Money laundering was layered directly on top of these tax manipulations. False invoices and inter-company transactions were used to cycle funds repeatedly through different corporate vehicles. This layering stage blurred the origins, making the trail more difficult for investigators to follow. Some funds were reintroduced into the financial system through investments, others held in luxury assets or converted into cryptocurrency, highlighting the adaptability of criminals to regulatory changes and new technologies.

The inclusion of illicit proceeds from unrelated crimes like drug trafficking and investment fraud indicates that the infrastructure was not built solely for tax offenses. Instead, it functioned as a laundering marketplace, where multiple criminal groups could plug in their revenues and benefit from the same concealment tools. Such ecosystems expand beyond national boundaries and test the ability of regulators and investigators to cooperate effectively.

The European Public Prosecutor’s Office used Latvia’s Court of Economic Affairs to consolidate these actions, a notable sign of evolving European mechanisms to deal with complex frauds. The case marks one of the first times that EU member states’ revenue authorities directly joined as civil parties, showing an expanded recognition of financial damage in cross-border laundering cases.

Legal and Regulatory Challenges

The Admiral 2.0 affair exposes both the strengths and the limits of the European anti-money laundering framework. On one hand, the case shows that investigative coordination between the European Public Prosecutor’s Office and national authorities is becoming increasingly effective. The seizure of luxury assets and cryptocurrency wallets, as well as the cooperation across multiple tax authorities, demonstrates progress in creating a unified response to financial crime.

On the other hand, the fact that over 400 companies were suspected of being used in the laundering structure reveals serious deficiencies in detection mechanisms. Shell companies remain a weak point in AML compliance, especially when ownership transparency is limited or beneficial ownership registers are incomplete. Criminals exploited these weaknesses to move funds across jurisdictions under the cover of legitimate trade.

The legal framework provides strong penalties: under Latvian criminal law, organized tax evasion can result in up to 10 years of imprisonment, while money laundering carries up to 12 years. These sentencing thresholds highlight the seriousness with which such offenses are treated, yet actual convictions and deterrence often depend on the efficiency of prosecution and the speed of proceedings.

Another challenge involves digital assets. Cryptocurrencies play an increasingly significant role in laundering, as shown in this case. While EU regulations such as the Markets in Crypto-Assets Regulation and the Anti-Money Laundering Authority framework aim to increase oversight, practical enforcement remains difficult. Admiral 2.0 demonstrates how cryptocurrency is seamlessly integrated into laundering schemes, reinforcing the need for continuous adaptation of laws and supervisory practices.

The case also underlines how criminal groups strategically select jurisdictions with perceived enforcement gaps. By situating part of the operations in Latvia but targeting multiple EU states, the network exploited both geographic and regulatory fragmentation. The establishment of the European Public Prosecutor’s Office was designed precisely to close such gaps, and Admiral 2.0 has become a critical test of its effectiveness.

Lessons for AML Practitioners

For compliance professionals, Admiral 2.0 is a case study in the dangers of fragmented oversight. The scale of the scheme, with damages exceeding €297 million, illustrates that traditional risk-based controls are insufficient without robust cross-border cooperation.

First, the case highlights the importance of monitoring trade-based money laundering, especially in sectors vulnerable to invoice manipulation like consumer electronics. Financial institutions must enhance trade finance monitoring systems, incorporating red flags such as repetitive circular transactions, unusual invoice values, or sudden involvement of shell companies in high-value cross-border deals.

Second, the integration of illicit funds from unrelated criminal activities shows that compliance teams cannot silo risks by predicate offense. Instead, risk models should account for multi-crime convergence, where laundering infrastructures are shared across networks. This requires advanced analytics and information-sharing arrangements between institutions and regulators.

Third, asset confiscation remains a central deterrent. The seizure of cash, watches, and cryptocurrency illustrates the need for financial institutions to cooperate with law enforcement in tracing asset flows. The use of cryptocurrency wallets emphasizes that monitoring must extend beyond fiat transactions into blockchain analytics, requiring new technical capabilities within compliance functions.

Finally, the participation of national revenue authorities as victims sets an important precedent. It demonstrates that AML failures have tangible consequences for public budgets, not just financial institutions. For practitioners, this highlights the need for strong partnerships with tax authorities and customs agencies, ensuring that financial crime prevention extends beyond banking compliance into broader state interests.

Source: EPPO

Some of FinCrime Central’s articles may have been enriched or edited with the help of AI tools. It may contain unintentional errors.

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Three plead guilty in Admiral 2.0 €297M laundering case

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