Brussels, 23/07/2012 (Agence Europe) - The number of cases of fraud involving European funds fell sharply from 2010 to 2011. In its annual report for 2011, published in 19 July, the European Anti-Fraud Office (OLAF) notes a 35% reduction in irregularities. This encouraging figure was more the result of cyclical effects than to good practice, according to OLAF, which highlights the lack of cooperation on the part of member states in communicating cases of dishonesty. The financial impact of the irregularities is, nonetheless, great, representing €404 million. Cohesion policy, with 276 irregularities reported as fraudulent, retains the unenviable title of the sector where there is most improper use of European funding, followed by the common agricultural policy (139). Fraud was also found in fisheries and pre-accession funding.
Not a real success. In 2011, 1,230 irregularities were reported as fraudulent, 35% down on the previous year. OLAF, however, does not consider this as a real success. It was, OLAF says, expected, following the sharp increase in 2009 and 2010, which was caused by the “cyclical” effect of the closure of the 2000-2006 programming period for cohesion policy. OLAF also highlights the significant differences in the reporting of irregularities by member states. The larger member states do not, OLAF notes, provide examples to be followed.
139 irregularities in the CAP. The differences in reporting by member states are particularly apparent in the common agricultural policy (CAP). The report states: “Certain big-spending Member States such as France, Germany, Spain and the United Kingdom continue to report a very low number of irregularities as fraudulent”. This, OLAF says, raises the question whether the low number declared as fraudulent is due to non-compliance with reporting principles, including their interpretation of the terms “suspected fraud” and “established fraud”, or to the ability of the control systems in place in these member states to detect fraud. It hails the progress made by the Netherlands, Finland and Poland, however. The highest numbers of fraudulent irregularities were in Bulgaria and Romania. Of the 139 cases, these two countries accounted for almost half, 37 and 25 cases respectively. While the number of fraudulent irregularities in relation to the CAP fell in 2011 compared with the previous year, the financial impact increased, from €69 million to €77 million.
Cohesion: exaggeration, falsehood, corruption. Cohesion policy is by far where there is greatest dishonesty, with 276 cases in the EU in 2011 - though this figure is down 46% on 2010. Most frequently the irregularities take the form of inflation of project costs, use of false documentation and ineligible beneficiaries. Three cases of corruption were also detected, worth some €750,000. Italy, Poland, and Germany together reported more than half of these cases of fraud (149). Germany, indeed, remains the most successful member state at completing criminal proceedings to establish fraud and impose penalties. The financial impact of cohesion policy fraud fell by 63%, to around €200 million.
Fighting fraud remains a priority. The Commission and OLAF are working hard to tackle fraud, and expect more of the member states, especially in the area of cohesion. The report notes that “the need to combat criminal fraud is still very real, particularly in a recession, and remains high on the Commission's agenda”. It is recommended that member states take adequate anti-fraud measures, whether in prevention or detection. Progress must also be made in recovery where procedures are still relatively long. (MD/transl.rt)