Brussels, 17/03/2005 (Agence Europe) - After two years of investigations, the European Anti-Fraud Office (OLAF) announced on Thursday that it had been unable to find sufficient proof that any of the aid paid by the EU to the Palestinians had been used to fund terrorist acts. OLAF does not, however, rule out the possibility of abusive use of the budget of the Palestinian Authority, especially due to shortcomings in internal and external audit procedures. OLAF, which concluded its inquiry on 12 March, states in a press release that on the basis of the information available, it had not been possible to find sufficient elements of proof to conclude that terrorist attacks or illegal activities had been financed with the budgetary assistance granted by the European Commission to the Palestinian Authority. However, coherent indications support the hypothesis that it cannot be ruled out that assets of the Palestinian Authority may have been used by certain individuals for ends other than those planned, OLAF adds. OLAF investigators revealed that 238 million dollars had been transferred by the Palestinian leadership to Swiss bank accounts between 1997 and early 2000, but that international donors had not been informed. However, they add, this transfer could not have concerned funds granted from the Community budget as the Commission did not begin to pay EU aid to the Palestinians until November 2000. OLAF also states that the funds transferred to Switzerland have since been included in the Palestinian investment fund under the aegis of the finance minister of the Palestinian Authority.
The first payments of money from the EU budget to Palestine took place in November 2000, after the decision of the Israeli government to suspend the transfer of tax and customs revenue to the Palestinians in response to the second “Intifada”. The Commission made payments of 246.3 million EUR under this programme up to April 2003, when it decided to make changes to the assistance programme. OLAF's investigation also confirmed the 145 million EUR paid by the EU between 2003 and February 2005 under the new programme. The office opened its investigations in February 2003, in response to concerns voiced by MEPs and Israeli accusations that European funding had been used by Palestinians to sponsor attacks.