Portuguese investigators are carrying out a major operation into suspected VAT fraud involving losses of more than €100 million to public funds, according to CNN Portugal. More than twenty arrests are planned over suspected criminal association, tax fraud and money laundering.

The operation, named Hermes, was under way on Wednesday morning. It involves searches across Portugal and simultaneous searches and arrests in other European Union member states.

Searches Across Portugal

According to CNN Portugal, 700 Polícia Judiciária inspectors are taking part, alongside 300 inspectors from the Autoridade Tributária, the tax authority. They are searching companies, homes and lawyers’ offices.

Of the 250 searches, 150 are at companies. European prosecutor José Ranito is overseeing the investigation at the European Public Prosecutor’s Office.

The operation concerns two investigations centred on Porto, with connections to several companies in the Greater Lisbon area. People detained in Portugal will be brought before Porto’s Criminal Investigation Court.

Suspected Fraud Involving Mobile Phones

The investigations concern similar schemes involving unpaid VAT or improper VAT refunds. According to CNN Portugal, these involved simulated sales of thousands of mobile phones between companies in different European Union countries.

Some of the businesses were shell companies created solely for the scheme. The broadcaster reported that the suspected criminal association also caused tax losses to public funds in other member states involved in the operation.

Investigations Grew From Operation Admiral

The two cases began with information gathered during Operation Admiral in 2022. That operation led to the arrests of businessman Max Cardoso and his wife, former television presenter Ana Lúcia Matos, among others.

CNN Portugal described the earlier scheme as similar but larger in scale. Estimated losses were €80 million for the Portuguese state and hundreds of millions of euros across Europe.

Cardoso was sentenced in 2025 to seven and a half years in prison. The broadcaster reported that Operation Hermes involves different people.

Source: CNN Portugal: “Carrossel do IVA: 700 inspetores da PJ na rua e dezenas de detidos em fraude milionária”, published 7 Oct 2026.