German retail chain Edeka South Bavaria is facing serious scrutiny after investigators carried out a series of coordinated raids on company premises and associated contractors this week. Around 50 officers from the customs investigation unit, Munich police, and tax authorities searched multiple sites in Munich, Unterammergau, and Gaimersheim, where the regional headquarters of Edeka South Bavaria is located.
The joint operation, led by the Munich I public prosecutor’s office, focuses on allegations of illegal employment, tax evasion, and social-security fraud involving external service providers. According to official statements, the damage to the public sector and social insurance institutions could amount to at least €20 million.
External service companies in the spotlight
Prosecutors emphasize that the investigation does not currently target Edeka’s top management, but rather employees of a subsidiary company and several external contractors hired to restock supermarket shelves.
These subcontractors are suspected of having employed migrants without proper documentation, primarily for shelf-stacking tasks in dozens of stores across southern Bavaria. Authorities believe the firms failed to pay required taxes and social-security contributions and may have operated under a network of short-lived “shell companies” to conceal the activities.
From labour inspections to arrests
The case reportedly began after routine labour inspections uncovered irregularities in several supermarkets. Four individuals connected to the subcontractor level have since been taken into pre-trial detention, while more than 70 suspects are now under investigation.
One of the alleged main figures is already standing trial in Munich, with proceedings expected to continue into April 2026. The investigation suggests that multiple intermediary firms were established only for a few months before being replaced — a pattern commonly used in large-scale labour fraud schemes.
Company response and scale of operations
Edeka confirmed the searches, stating that it is fully cooperating with the authorities and cannot comment further while the investigation is ongoing.
Edeka South Bavaria employs roughly 27,000 people, supplies around 1,100 retail outlets, and reported annual revenues exceeding €4.8 billion in its latest accounts.
While the current suspicion centres on external contractors rather than the group itself, the case highlights a growing challenge in Germany’s retail sector: the use of complex subcontracting chains, which often make accountability and compliance enforcement extremely difficult.
Authorities continue to evaluate seized documents and electronic records. Further charges may follow as the scope of the alleged scheme becomes clearer in the coming months.
