Italian financial police have seized €121 million from an Amazon branch in Milan following accusations of tax fraud and worker exploitation. The investigation centres on the alleged use of "labor reservoirs," a system where large companies illegally outsource logistics services to reduce labor costs and taxes.
The seizure order claims the tax fraud involved an "illicit mechanism of invoices" for fictitious transactions under fake labor contracts, leading to the issuance and use of false documents. Prosecutors traced the "labor supply chain" and found that labor relations were concealed by "filter" companies that utilised several cooperative companies, systematically evading VAT, social security, and welfare contributions.
Amazon responded by stating that it complies with all applicable laws and regulations and requires its partners to do the same. The company emphasised its high standards and Supplier Code of Conduct, expressing its willingness to cooperate with authorities.
This is not the first time Amazon has faced legal scrutiny in Italy. Earlier this year, the company was fined €10 million over its Subscribe and Save option, deemed to infringe on consumer rights. Amazon is the latest in a series of major companies, including DHL, Uber, and Lidl, to be investigated by Italian prosecutors for similar offenses
