Currently reading: Scrappage fraud in Germany
Federal crime office launches investigation into claims scrapped cars are being smuggled to Africa

Germany’s federal crime office, the BKA, has launched a fraud investigation into claims that thousands of vehicles traded in under the country’s scrappage incentive scheme have been smuggled abroad rather than scrapped.

BKA vice-president Wilfried Albishausen said more than 50,000 officially scrapped vehicles could have been illegally transported to eastern Europe and Africa.

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“The markets are virtually insatiable,” he said. “Eastern Europe and Africa have a backlog of demand for used vehicles.”

Scrappage has proved popular in Germany, with sales up 29.5 per cent in July.

Germany introduced its scrappage incentive scheme in February and it will run to the end of 2009. Buyers get a discount of 2500 euros (£2100) on a new car when they trade in a model aged nine years or over.

Albishausen said the scheme was extremely profitable and this had led to many vehicles finding their way to eastern Europe and Africa.

“The profit margin is enormous,” he said. “If we assume that it is in fact about five per cent to 10 per cent of vehicles [traded in under the scrappage scheme and then smuggled out of the country], that is about 50,000 cars, which is a profit of about 125 million euros [£106m] - 2500 euros per car."

German finance minister Peer Steinbrueck said some abuse of the scheme was inevitable.

"You can never entirely rule out a certain amount of abuse," he said.

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