Fight against misappropriation of EU funds begins

Each year, criminals steal hundreds of millions of euros from the EU budget through fraud, corruption, money laundering and the misappropriation of funds.

 

EU chief prosecutor Laura Kövesi was responsible for jailing dozens of high-ranking officials in Romania as chief anti-corruption prosecutor between 2013 and 2018, before being ousted by the then-ruling party.

She now starts the hunt for fraud against the EU budget through the EU public prosecutor’s office (EPPO) that started its operations on Tuesday.  It will investigate fraud involving EU funds of over €10 000 and cross-border VAT fraud.

Each year, criminals steal hundreds of millions of euro from the EU budget through fraud, corruption, money laundering and the misappropriation of funds – money taken away from EU citizens that could have been used to help the unemployed, businesses, healthcare workers and other services, the EPPO said during its launch.

This cross-border crime could so far only be fought within national borders. Cross-border VAT fraud alone is estimated to cost the EU between €30 billion and €60 billion per year, as an investigation conducted by The Shift in collaboration 35 media partners and covering all EU countries has shown. Companies registered in Malta were part of the criminal network.

“We are here to fight against financial fraud. It’s not an easy job because there is no precedent for the EPPO. It is very difficult to apply 22 different criminal codes, but we have the right spirit, the right focus, the right determination to make the EPPO an independent, strong and efficient institution trusted by the citizens of Europe,” Kövesi said.

The EPPO will include prosecutors from 22 EU Member States. Denmark, Ireland, Hungary, Poland and Sweden chose not to take part, which shows the difficulties faced in establishing the office.

It is estimated that the EPPO, which will accept reports also from citizens, will handle some 3,000 cases annually.

“I hope that in the coming years the EPPO will become one of the most important European institutions,” Kövesi added.

At a national level, EPPO can call on a network of 140 delegated prosecutors across the 22 member states to investigate cases. Once the EPPO takes up an investigation, national authorities must stand back from the case, and only report any relevant matters to the Luxembourg office. Cases will then be prosecuted in the national courts. Some cases have already been registered coming from Germany and Italy, Kövesi said.

Vice-President for Values and Transparency in the European Commission Věra Jourová said the EPPO is “history in the making”.

“This is a good day for EU taxpayers. A strong signal in the fight against fraud, especially at a moment where Europe invests a lot of money in the recovery,” she added.

First Vice-President of the European Parliament Roberta Metsola said, “it’s a big moment for Europe and a big moment in the fight against EU financial crime”.

In exercising its mandate, the EPPO will be able to rely on a close partnership with the European Union Agency for Criminal Justice Cooperation (Eurojust) whose legal mandate equally includes, among others, protecting the financial interests of the Union.

Featured photo credit: Anthony Dehez / EC

                           
                               
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