Thriving illegal activities during the pandemic

In a concerning development, evidence points towards an increase in illegal employment during the COVID-19 pandemic. The Customs Financial Control Schwarzarbeit (FKS) has reported a significant rise in financial damage from black market work in 2020, despite many industries being scaled back due to the pandemic.

The financial damage to the treasury and social security systems from black market work in 2020 was 816.5 million euros, an increase from 755.4 million euros in 2019. This rise has been observed despite the activities of the FKS being restricted during the pandemic, according to the finance ministry.

Markus Herbrand, FDP financial expert, stated that "black market work has flourished like never before during the pandemic." The opposition believes that the higher damage with fewer investigations indicates a significant increase in illegal employment during the pandemic.

The exact cause for this increase in financial damage from black market work in 2020 compared to 2019 is not specified in the article. The BMF finds year-to-year comparisons problematic due to cases often being recorded in different statistical periods.

As of September 10, 2021, the FKS had recorded a damage of 574 million euros for that year. By this point in 2019, the damage recorded was 414.4 million euros.

The fight against the shadow economy is in a "worrying state" at the end of Finance Minister Olaf Scholz's (SPD) term. The responsibility for combating the shadow economy in the government largely involves strengthening the Financial Control of Undeclared Work (Finanzkontrolle Schwarzarbeit, FKS). However, there is no direct indication that Finance Minister Olaf Scholz was personally or explicitly responsible for this task according to the available sources.

Despite this, Minister Scholz has expressed approval of successful investigations that weaken organized crime related to tax evasion and illegal trade, which is indirectly related to shadow economy issues. The finance ministry did not specify why the activities of the FKS were restricted due to the pandemic.

This rise in illegal employment during the pandemic is a cause for concern, as it not only affects the financial health of the nation but also potentially undermines the efforts to control the spread of COVID-19. Further investigations and measures are needed to address this issue and ensure the integrity of the economy.