The tax authority Skat has reported to the fraud office, Statsadvokaten for Særlig Økonomisk og International Kriminalitet (SØIK), that shareholders living abroad have cheated the state coffers out of 6.2 billion kroner.

The fraud is reportedly connected to the payout of share dividends.

When Danish companies pay out share dividends there is a 27-percent withholding tax, but foreign shareholders in the EU or those exempted by double tax treaties can get all or part of the taxed refunded.

“Our preliminary investigations indicate that a large group of companies abroad have apparently applied to have the tax refunded based on fictional share holdings and falsified documentation,” said Jesper Rønnow Simonsen, the head of Skat.

READ MORE: Dane sets up refugee donation initiative for tiny tax refund

Three years coming
Skat was alerted to the fraud after receiving inquiries from abroad during the summer period, and it reported the fraud to SØIK following an internal investigation.

So far the fraud seems to involve 2,120 applications for tax refunds during the period 2012-2015.