Amidst the backdrop of Brexit, there could be even more ill will between the UK and the EU as fraud investigators are recommending the UK pay €2bn to cover alleged customs failures related to Chinese imports.

The EU's anti-fraud office, known as OLAF, said it believed the EU's budget was owed the money to cover the cost of duties lost when the UK failed to tackle a widespread, and deliberate, undervaluation of goods.

Its inquiry found that fraudsters evaded customs duties by using false invoices and incorrect customs value declarations between 2013 and 2016.

OLAF claimed that while several other EU member states took action to combat the fraud, HM Revenue & Customs (HMRC) continued to ignore the problem despite repeated warnings.

In a statement OLAF said "These fraudsters are in fact organised crime groups whose actions affect the entire EU; they operate in criminal networks active across the EU.

"The OLAF investigation revealed that most of the imports arrive for custom clearance in the UK, but are in fact supplies destined for the black market traffic of textiles and footwear in other member states across the EU.

"Upon concluding the investigation, OLAF calculated a loss of almost €2bn to the EU budget in terms of lost customs duties due on textiles and shoes imported from China through the UK in the period 2013-2016.

They finished by saying "These losses to the EU budget are still on-going since this fraud has not been stopped to date."

The organisation said it was now up to the EU and UK authorities to decide how to proceed with these findings, with Brexit talks just around the corner. 

(Additional reporting from IRN)