National Police in Cataluña have so far arrested 145 people and charged another 275 with defrauding €7.8 million through the setting up and running of shell companies to make fake work contracts for the purpose of collecting unemployment benefit.
The police investigation began several months ago when a plot was discovered to create fake construction-based, cleaning and gardening services companies for the sole purpose of claiming unemployment and other benefits.
Some nineteen companies registered with Social Security were initially identified as being basically devoid of employees or any real means of income. Many of the people benefiting from the situation were apparently foreigners, most of whom were trying to legalise their status in Spain.
The police investigation is still ongoing.