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An investigation by the EU's anti-fraud office, OLAF, and French authorities in the first half of last year claimed British customs officials ignored repeated warnings to prevent Chinese clothing and footwear from flooding into the EU at a minuscule fraction of their production costs from 2014 to 2016, with some evidence from 2013.
They add this resulted in a "significant loss" of revenue from the collection of duties and taxes of other member states which the goods were then distributed to, with Spain, France and Italy taking the main brunt of losses and Poland and the Czech Republic making more marginal losses.
EU officers found false invoices valued the goods at five to 10 times lower than they should have been.
Due to UK customs' alleged "continuous negligence", the EU was deprived of £1.72bn in lost duty revenue, according to website Politico.
A total of £2.8bn in VAT was also denied to other EU countries because of the UK, OLAF found.
To get back some of the funds, OLAF has recommended the British Government should be forced to pay the £1.72bn directly into the EU budget by the European Commission's Directorate-General for Budget.