€600 million in defrauded EU Covid relief funds seized
Police in Italy, Austria, Romania, and Slovakia have arrested more than 20 suspects in a €600 million fraud. A cross-border investigation by the European Public Prosecutor’s Office (EPPO) revealed that a criminal organisation had defrauded the EU's Recovery and Resilience Facility (RRF) by using a network of fake companies to apply for funds.
EU prosecutors ordered police to raid the suspects' homes and businesses. They seized and froze assets, including apartments, cryptocurrency, gold and jewellery, and luxury cars.
More than 200 fraud investigations were opened last year regarding the RRF cash pot. The RRF was set up to help Europe recover from the economic damage caused by the Covid-19 pandemic. Through the facility, the European Commission has made hundreds of billions of euros available to member states. Italy, where the fraud under investigation took place, is the biggest beneficiary of RRF funds, having received €191.5 billion.
As a centrepiece of the 'NextGenerationEU' recovery tool, RRF funding is intended to improve competitiveness in European companies following recent economic hardships.
But this fraud, carried out by a criminal organisation with experts in applying for public funding, shows how huge portions of EU money can be swept up by bad actors. It seems that for modern criminal organisations, racketeering and robbery have been replaced by a more lucrative source of income, pocketing EU subsidies.