Fraud and error costs taxpayers €888 million

It has been revealed today that the EU paid a grand total of £675 million to criminals who made fraudulent aid claims in 2015. The majority of these claims coming from Romania, Bulgaria and Hungary, some of the EU’s poorest states.

The European Anti-Fraud Office (OLAF) announced that in 2015 1,442 allegations of fraud were investigated, uncovering that €888 million from the EU’s budget has been spent inappropriately.

The amount paid out for fake claims has decreased slightly from €901 million in 2014, but the 2015 figure is 120 per cent higher than that of 2013.

This latest figure brings the total value of amount recommended by OLAF for financial recovery over the last four years to €2.5 billion.

To add insult to injury, only €187 million was recovered, a 10 per cent fall compared to 2014

One investigation related to a fruit and vegetable refrigeration plant in Bulgaria, which received €1.3 million from the European Agricultural Fund for Rural Development for new equipment. It turned out that both the Bulgarian company which received the money and the company that supplied the equipment were owned by the same person – an Italian who sold himself the gear at an artificially high price .  

Another fraud investigation exposed a scheme where solar panels produced in China were being imported into the EU with fake documents and serial numbers in order to avoid an anti-dumping duty on solar panels from China.

OLAF also investigated corruption by 40 EU officials last year in which four in ten who were implicated in fraud were not punished by their employers. Twelve officials were given a warning or reprimanded and even fewer were dismissed or faced disciplinary action.

Despite The European Anti-Fraud Office’s reorganisation more than four years ago, it is still failing to adequately reduce fraud. Individuals and organisations are still exploiting the weaknesses of the system, ultimately presenting European taxpayers with a hefty bill.