New details about C&A fraud: 135 workers in Serbia in trouble, there were more than 300 import scams

Further proceedings will be handled by the appointed bankruptcy trustee

C&A Serbia (C&A Srbija) has officially declared bankruptcy, it has been confirmed for Telegraf Biznis. In the meantime, the company issued a statement saying that it  had become "the target of organized customs fraud by unknown perpetrators."

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"The perpetrators have systematically committed more than 300 fraudulent acts that violate the customs regulations of the Republic of Serbia. This decision affects 14 stores and around 135 employees in Serbia. The situation is very specific and applies only to Serbia. This development does not in any way concern other markets where C&A operates," the Dusseldorf-based company, which sells textile goods, said in a statement.

It is added that the perpetrator of the fraud is one of the company's business partners, "as well as other perpetrators who are still unknown."

"The said perpetrators systematically carried out more than 300 acts of fraudulent importing in the period from 2014 to 2021, abusing the logo of the C&A company, the benefits of the customs status and the authority to represent the customs representative of the C&A company in Serbia. The criminal offense was discovered in October 2021, when the C&A company was first informed by the customs authorities of Serbia about the fraudulent importing," the statement reads.

It points out that after several months of investigation and despite the evidence that C&A should not bear the consequences of that criminal act, "the customs authorities of the Republic of Serbia took the position that the company C&A Serbia is responsible for paying customs duties for goods that were declared part of fraudulent imports."

"After a thorough analysis of the situation, the management team of C&A Serbia concluded that it cannot responsibly bear the risks of further challenging the legal position represented by the authorities of the Republic of Serbia. Given the financial scope of the claims directed against C&A Serbia, the management team was forced to declare insolvency today. Further proceedings will be handled by the appointed bankruptcy trustee," the company's announcement states.

Serbian authorities discovered that this company had been smuggling Chinese goods for almost seven years, thus incurring losses to the Serbian budget of six million euros.

"For almost seven years, this company worked against the law with the Austrian shipping company Quehenberger. Together, they made it possible to pass off smuggled Chinese goods as theirs by stamping it as supposed proof of authenticity. The shipping company even changed its name after the Customs Administration initiated the procedure, in order to preserve its reputation and be able to continue working in Serbia," the Customs Administration told Telegraf Biznis.

(Telegraf Biznis)