An Islamic State flag and drugs were found at several residences after German police cracked down on a ring of young migrants who had used fake identities to defraud German taxpayers.

Police raided the residences of 43 families this week on suspicion that they had participated in a scheme to defraud the government using fake identities. They estimate that around 78 suspects, all under 25 years old, were able to steal 141,000 euros in a coordinated and elaborate scheme, Bild reports.

Investigators found that the suspects had coordinated their scheme through the encrypted messaging app WhatsApp and had used shisha bars to recruit new migrants into the fraud.

The migrants were able to send applications to the government which stated they were entitled to retroactive benefits by using fake application or employment termination letters from various companies, some of which had been insolvent for years.

The initial suspicion came after government workers started to notice that many of the forged company letters were exactly the same as one sent by other applicants.

The finding of an Islamic State flag in one of the residences draws parallels to the case of Berlin terror attacker Anis Amri who also scammed the German government using fake identities.  Amri, a known drug dealer in Berlin, could have been deported a month before the terror attack that killed a dozen people, according to a special investigation.

While many migrants arrive in Germany with no documentation at all, others are able to remain in the country using fake documents. In 2016, German Interior Minister Thomas de Maizière accused medical professionals of creating fake medical certificates in order to prevent deportations.

The problem with fake documents has not been limited to Germany, either. Late last year in France, five medical doctors and four pro-migrant activists were arrested in connection with a scheme that defrauded the government and for issuing fake medical certificates for migrants to prevent their deportation.

 Follow Chris Tomlinson on Twitter at @TomlinsonCJ or email at ctomlinson(at)breitbart.com