Windfall for Italy? Customs Finds $134 Billion in a Suitcase

It is either the biggest smuggling operation in history -- or a fraud of equally impressive proportions. Italian customs officials stopped two men at the Swiss border carrying bonds worth $134 billion (95.8 billion euros).

Italian customs officers on the Swiss border often stop smugglers -- but not of this scale. Two Japanese citizens have been detained by Italian police in Chiasso on the Swiss-Italian border after being found with $134 billion of US bonds hidden in the base of their suitcase, according to a press statement by the Italian Guardia di Finanza.

Guardia di Finanza: Bonanza find.

Guardia di Finanza: Bonanza find.

The two men, reported to be more than 50 years old, were traveling by train from Italy to Switzerland on June 3. Financial police at a control on the border found the documents tucked inside a closed section at the bottom of their suitcase, separate from their personal items. According to their statement, the men's luggage included 249 government bonds worth $500 million and 10 so-called Kennedy bonds, each worth a billion dollars.

But details of the case remain unclear: The Japanese embassy in Rome confirmed the arrest of the two men but the news agency Bloomberg reported on Friday that it was not yet established whether they were Japanese citizens.

It yet to be seen whether this is the biggest smuggling scandal in history -- or a massive fraud. Italian officials said they were still checking the authenticity of the bonds.

But should the bonds, or at least some of them, turn out to be real, the men will face a significant penalty. In Europe it is illegal to transport more than €10,000 across borders without notifying customs.

Meanwhile, if they turn out to be authentic, Italy is set for a windfall. According to Italian law, the state could fine the men 40 percent of the seized money. Italy's mountain of public debt, which is at 105 percent of GDP, could shrink.

And although details of the case are still murky, the Italian media is already mulling how the windfall would be best spent. Aside from shrinking the national debt, there are suggestions the funds could help rebuild the earthquake-wrecked Abruzzo region.

jas -- with wire reports

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