€50m ‘dirty money’ in circulation in Spain

TAX inspectors in Spain have located some €50 million in €500 notes not declared since 2007.

Some 40 per cent of the suspicious property purchases investigated by the Tax Office in Andalucia were in Malaga.

However, the Head of the Tax Office, Ignacio Mendez Cortegano, says that since 2008, when the property market fell, the number of fraudulent operations in the sector has also gone down.

The control on €500 notes in circulation outside official financial entities began in 2006 after it was discovered that 26 per cent of all those existing in Europe could be found in Spain, reaching its peak of €57 million in 2007.

The percentage has since dropped and by September last year, there were €50 million in circulation, which is 65 per cent of the total amount of money in circulation in Spain, more than double the average percentage for the Eurozone.

The Secretary General for the Tax Officers’ Union, Jose Maria Mollinedo, estimates that four in five operations carried out with €500 notes which are under investigation are part of some fraud, amounting to around €16 million per year.

They suggest that the limit for paying in cash be set at €1,000 to prevent dirty money from circulating and earn the tax office some €26 million per year.

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