Frankfurt Gambling Crackdown: Organized Crime Tied to Tax Avoidance and Large-scale Earnings
February 14th Raid in Frankfurt am Main Against Unauthorized Gambling
As reported by the Frankfurter Rundschau, a substantial law enforcement operation took place in Frankfurt am Main on Valentine's Day morning. The operation involved a total of 23 gaming establishments and residential spaces, with approximately 230 police officers, tax investigators, and city police participating. Police dogs specialized in finding cash and data carriers were also present.
The officers confiscated 60 illicit slot machines in the course of their investigation, which had been operating unlawfully for months. The suspected organization had reportedly been operating these machines without a license in various Frankfurt locations since 2021, generating significant, untaxed revenue.
The suspects are also under scrutiny for alleged tax evasion, as they failed to pay the applicable VAT and gaming machine tax.
As per current investigations, the organization comprises 14 individuals, who are alleged to have run an illegal gambling operation as part of a criminal enterprise.
Unlawful Slot Machines in Germany
The Frankfurt raid is one of the largest operations against unlawful gambling in recent years. Concerns are now rising among legitimate arcade operators regarding the potential threat from the burgeoning black market. In illegal arcades, machines are used without regulation and safety standards are disregarded.
The illegal market is not an organic phenomenon. It arises from restricting the legal supply and making legitimate provision impossible due to regulatory barriers.– Georg Stecker, spokesperson for the German Automatenwirtschaft association, FAZ**
Estimates suggest between 40,000 and 50,000 illicit machines might be in operation in Germany. Quarterly earnings could reach up to 30,000 euros per machine. Thus, Georg Stecker, spokesperson for the German Automatenwirtschaft association, urged for stricter controls and lauded the successful raid in Frankfurt.
Foreign Machines and Tax Evasion
The investigation against the suspects was managed by a working group established in 2017 to regulate slot machines. The working group began investigating the gang following several anonymous tips, which they received in April 2023.
The suspects sourced their profits from various channels. Some obtained foreign slot machines without permission, while others lawfully rented machines but neglected to register them with the city, a legal requirement. Furthermore, a small fraction of the registered machines reported their profits, but only partially, to the tax office.
Gambling in Hidden Spaces
Officials discovered a legitimate gambling offer in some of the controlled gaming establishments. However, additional unlicensed machines were found in secluded areas for regular customers.
No tampered machines were found, according to authorities. Nevertheless, many devices permitted the placement of the maximum bet, which is forbidden for slot machines in German gaming halls based on player protection regulations.
Additionally, a man was apprehended with weapons and a substantial amount of marijuana.
The raid in Frankfurt am Main has sparked widespread news coverage, with many outlets highlighting the significant operation against unauthorized gambling. The crackdown on illicit gambling operations is a hot topic in the news, raising concerns about the safety and regulation of gaming establishments in Germany.
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