Crime in the construction industry has changed dramatically during the 21st century. What was previously primarily about undeclared wages has now developed into more advanced schemes where criminal networks use construction companies for money laundering.

This is revealed in a new report from Fair Play Bygg, which was started in 2016 by Byggnads Stockholm-Gotland and the Stockholm Construction Employers’ Association. The project came about after Byggnads Stockholm-Gotland had begun addressing the issue of growing crime in the construction sector several years earlier.

According to the report, the construction industry is now used to launder money from, among other things, drugs, weapons trade, and prostitution. The schemes are described as increasingly sophisticated, with companies in some cases secretly controlled by criminal actors, and boards consisting of so-called front men.

– Today I see a risk of system collapse. Foreign workers are here working without paying taxes in Sweden. Construction companies function as fronts for laundering illicit money. We have lost control over the construction industry, says Fredrik Sirberg, ombudsman at Byggnads Stockholm-Gotland, to Byggnadsarbetaren.

Over 3,000 Tips

Since its inception, Fair Play Bygg has received over 3,000 tips about suspected criminal activity at construction sites in the Stockholm area. Almost 2,800 of these tips have concerned suspected undeclared work.

More than 1,650 cases have since 2016 been handed over to the authorities. According to Fair Play Bygg, this has resulted in tax reassessments totaling over SEK 185 million.

A central part of the work is that tips can be submitted anonymously. According to Sirberg, this is crucial in cases where company owners or employees may be exposed to threats, because according to him, they will never turn to the police if they have been threatened with death. That is why an independent tip-off function not connected to the authorities would be very important, he argues.

Fair Play Bygg has also reported 352 addresses with serious work environment deficiencies to the Swedish Work Environment Authority. According to the project, this has led to workplace inspections and penalties totaling over SEK 13 million.

Calls for National Initiatives

Fair Play Bygg believes that the work needs to be scaled up nationally. Among other things, they want the centers for combating labor market crime that have opened across the country to receive more resources.

The project is also calling for better control in public procurement. According to the data highlighted in the report, the annual sum of public procurements in Sweden has exceeded SEK 1,000 billion. At the same time, the criminal economy, according to the Swedish Economic Crime Authority, amounts to just over SEK 350 billion annually.

He argues that this involves very large tax losses.

– We are losing tax revenues worth billions; it is an unimaginable amount of money we are talking about, and there is no other way to describe it than as a system collapse, concludes Fredrik Sirberg.