COMMISSION STAFF WORKING DOCUMENT Implementation of Article 325 TFEU by the Member States in 2017 Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 29th Annual Report on the Protection of the European Union's financial interests - Fight against fraud - 2017
Date: 2018-09-03
Institutions: European Anti-Fraud Office, European Commission
Subjects: EU programme, activity report, common strategy, crime, fight against crime, financial control, fraud, fraud against the EU

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 3.9.2018  SWD(2018) 384 final  COMMISSION STAFF WORKING DOCUMENT Implementation of Article 325 TFEU by the Member States in 2017 Accompanying the document REPORT FROM THE COMMISSION TO  THE EUROPEAN PARLIAMENT AND THE COUNCIL 29th Annual Report on the Protection of the European Union's financial interests - Fight against fraud - 2017  {COM(2018) 553 final} - {SWD(2018) 381 final} - {SWD(2018) 382 final} - {SWD(2018) 383 final} - {SWD(2018) 385 final} - {SWD(2018) 386 final}  
 
 
TABLE OF CONTENTS 

Table of Contents ....................................................................................................................... 1 

Table of Figures ......................................................................................................................... 2 

1 

1.1 

1.2 

1.3 

1.4 

2 

2.1 

Overview of the measures taken by Member States in 2017 ....................................... 3 

Legislative measures .................................................................................................. 6 

Administrative measures ........................................................................................... 6 

Organisational measures ........................................................................................... 6 

Operational measures ................................................................................................ 7 

Cross-cutting anti-fraud initiatives and measures by Member States .......................... 7 

Progress on the development of National Anti-Fraud Strategies in 2017 .................... 7 

2.1.1 

Background to NAFS.................................................................................................... 9 

2.1.2  Guiding principles ........................................................................................................ 9 

2.2 

2.3 

2.4 

3 

3.1 

4 

4.1 

4.2 

5 

5.1 

Measures to enhance transparency and fight corruption and anti-conflict of interest in 
public procurement ..................................................................................................... 10 

Measures against financial and organised crime ........................................................ 15 

Other measures ........................................................................................................... 18 

Anti-fraud measures covering both Revenue and Expenditure sectors ..................... 21 

Revenue and Expenditure .......................................................................................... 21 

Anti-fraud measures in Revenue by the Member States ............................................ 22 

Fight against customs fraud ....................................................................................... 22 

Fight against tax evasion and VAT fraud .................................................................. 30 

Anti-Fraud Measures by Member States - Expenditure ............................................. 31 

Measures covering several shared management sectors ............................................ 31 

5.1.1 

Agriculture, Fisheries, Cohesion policy..................................................................... 31 

5.1.2 

Agriculture, Fisheries, Cohesion, AMIF, FEAD and EGF ........................................ 35 

5.1.3  Cohesion policy, fisheries, AMIF, EGF, FEAD ......................................................... 36 

5.2 

5.3 

Agriculture ................................................................................................................. 39 

Cohesion policy and Fisheries ................................................................................... 44 

5.3.1  Cohesion policy .......................................................................................................... 44 

5.3.2 

Fisheries ..................................................................................................................... 52 

5.4 

6. 

6.1. 

Measures covering several shared management funds and centralised management 53 

Additional measures reported by Member States ...................................................... 55 

Belgium ...................................................................................................................... 55 

6.1.1.  Federal Public Service - Finance (Anti-Fraud Cell) 2 additional measures: ............. 55 

1 

 
 
6.1.2.  ERDF Wallonia: ......................................................................................................... 55 

6.1.3.  Belgium's Anti-fraud Coordination Service  (AFCOS/CAF) and Interdepartmental 

Committee for Coordinating the Fight against Economic Fraud (CICF): ................. 55 

6.2. 

Bulgaria ...................................................................................................................... 56 

6.2.1.  Operational measure ................................................................................................... 56 

6.2.2.  Organisational measure .............................................................................................. 56 

6.3. 

6.4. 

6.5. 

7. 

8. 

8.1. 

8.2. 

8.3. 

8.4. 

8.5. 

8.6. 

8.7. 

8.8. 

8.9. 

Croatia ........................................................................................................................ 56 

Slovenia ...................................................................................................................... 57 

United Kingdom ......................................................................................................... 57 

Training on the Irregularity Management System organised by the Member States . 58 

Case studies reported by Member States ................................................................... 58 

Bulgaria ...................................................................................................................... 58 

Belgium ...................................................................................................................... 59 

Greece ........................................................................................................................ 60 

Finland........................................................................................................................ 60 

Croatia ........................................................................................................................ 61 

Hungary ...................................................................................................................... 62 

Italy ............................................................................................................................ 62 

Lithuania .................................................................................................................... 63 

Latvia.......................................................................................................................... 64 

8.10.  Netherlands ................................................................................................................ 65 

8.11.  Romania ..................................................................................................................... 65 

TABLE OF FIGURES 

Figure 1: Distribution of reported measures by type ..................................................................... 4 

Figure 2: Measures shown by area addressed and stage/s in the anti-fraud cycle ........................ 5 

Figure 3: Number of measures reported by area ........................................................................... 5 

Figure 4: Cross-cutting v Sectoral ................................................................................................. 6 

Figure 5: Cross-cutting vs Sectoral by Member State ................................................................... 6 

Figure 6: Sectoral measures: expenditure ..................................................................................... 7 

Figure 7: NAFS: State of play ....................................................................................................... 9 

Figure 8: Training sessions organised by Member States in 2017 .............................................. 59 

2 

 
 
 
 
 
MEASURES TAKEN BY MEMBER STATES 

1  OVERVIEW OF THE MEASURES TAKEN BY MEMBER STATES IN 2017 

Member States reported a significant number (73) of measures in 2017 on the protection of the 
EU’s financial interests and the fight against fraud, reflecting the adoption of the bulk of Union 
legislation for the new programming period 2014-2020. Member States were invited to report a 
maximum of three (most important) anti-fraud measures. This analysis therefore gives a good 
overview  of  trends  and  priorities  in  the  anti-fraud  measures  implemented  by  Member  States, 
but it is not exhaustive. The number of measures effectively reported would be higher, if one 
considers  that  Member  States  may  report  'single'  or  'package'  measures.  The  latter  usually 
encompasses a number of instruments adopted at the same time. Taking into individual account 
the 'package' measures, the number of reported initiatives rises to 111. 

Some Member States also reported additional measures (for a total of 10). They are detailed in 
chapter 6 of the present document. 

Eleven Member States also reported case studies in various sector of the protection of the EU 
financial interests. They are collected in chapter 7. 

Four  different  types  of  measures  were  reported  and  analysed:  legislative,  administrative, 
organisational and operational. The highest number of reported measures is of an organisational 
nature,  but  there  is  a  relative  balance  among  all  the  types  of  initiatives  reported  by  Member 
States, as showed in Figure 1. 

Figure 1: Distribution of reported measures by type 

Member  States’  measures  covered  the  entire  anti-fraud  cycle,  but  focussed  in  particular  on 
fraud  detection  (77%  of  the  measures)  and  prevention  (76%),  mostly  in  the  area  of  shared 

3 

 
 
 
management  and  control  of  EU  funds  (49%),  followed  by  measures  against  financial  crime 
(including money laundering – 22%).  

Figure 2 shows how the various  measures are distributed per area and stage  of the anti-fraud 
cycle concerned. 

Figure 2: Measures shown by area addressed and stage/s in the anti-fraud cycle 

Figure 3 breaks down the same information by Member State and by area concerned. 

Figure 3: Number of measures reported by area 

It should always be kept in mind that each measure can target more areas. 

The majority of measures were sectoral (77%), but those of a horizontal natural still represent 
almost a fourth (23%), as showed in Figure 4.  

4 

PreventionDetectionInvestigationRecovery Total N° of measuresPublic procurement10124615Financial crime (incl. money laundering)111410516Organised crime8108310Corruption8103210Conflict of interest12103415Fraud definition67438AFCOS76229Whistleblower89339Customs / TOR / illicit trade9119615Shared management and control of EU funds242591134Antifraud or anticorruption strategy994311Other17156321TOTAL5556241873%75%77%33%25%100%Member StateNo of measuresPublic procurementFinancial crime (incl. money laundering)Organised crimeCorruptionConflict of interestFraud definitionAFCOSWhistleblowerCustoms / TOR / illicit tradeShared management and control of EU fundsAntifraud or anticorruption strategyOtherAT21121BE3211BG3311113HR331CY311121CZ3122111DK11EE21111FI311112FR21212DE311111211GR3122HU31113IE111IT3112LV32122212121LT3211112LU3121MT111NL3221PL311121PT32211121RO3111SK2121SI321121322ES3112SE32213UK211211211TOTAL73151610101589915361120% of total100%21%22%14%14%21%11%12%12%21%49%15%27% 
 
 
 
Figure 4: Cross-cutting v Sectoral 

Figure 5 breaks down this information by Member State. 

Figure 5: Cross-cutting vs Sectoral by Member State 

5 

Member StateHorizontalSectoralTotalAT22BE33BG33HR33CY123CZ33DK11EE112FI33FR22DE33GR123HU33IE11IT33LV123LT123LU33MT11NL33PL123PT33RO213SK22SI123ES123SE33UK22TOTAL175673 
 
 
 
Among the sectoral measures reported, about 41 relate to various expenditure sectors and 15 to 
revenue. Figure 1 shows that the majority of adopted measures in expenditure sectors relate to 
Cohesion policy and Agriculture. 

Figure 6: Sectoral measures: expenditure 

1.1  Legislative measures 

Member States reported twenty legislative measures (of which 8 as part of a package 
of  measures).  The  majority  of  these  acts  are  either  horizontal  or  referred  to  the 
expenditure  sectors,  while  only  a  few  refer  exclusively  to  revenue.  Legislative 
measures reported by Member States mainly relate to the definition of competence and 
powers (7 measures each) or financial penalties (5). Their adoption is mainly meant to 
clarify or consolidate existing rules (11), but also to remedy flaws in the systems  (6) 
and to enforce the rules in line with developments in EU law (6). 

1.2  Administrative measures 

Thirty administrative measures have been reported by Member States (of which 19 as 
part  of  a  package  of  measures)  and  they  were  mainly  addressing  'monitoring/desk 
checks' and 'irregularities reporting' (13 measures each). The purpose of such measures 
was to enhance existing measures (17) and to clarify or consolidate existing rules (13). 

1.3  Organisational measures 

Organisational measures were the most reported by Member States: 33 (of which 18 
adopted  as  part  of  a  package  of  measures).  Mainly  they  addressed  'fraud  awareness 
raising' 
'inter-agency  cooperation',  specification 
concerning  the  'competence'  of  the  bodies  involved  or  'general  trainings'  (12  each). 
Mostly they resulted neutral in terms of resources (19), but in a number of cases (10), 

initiatives  (14  measures),  or 

6 

 
 
 
organisational  measures  adopted  produced  an  increase  of  resources  for  the  bodies 
concerned. 

1.4  Operational measures 

Twenty-eight operational measures have been reported by Member States (of which 17 
as  part  of  a  package  of  measures),  mainly  referring  to  the  introduction/use  of  'risk 
indicators' (16) and  of  'IT tools' (14). Also the deployment of  'web reporting/hotline' 
for  fraud  detection  was  reported  (5).  Some  measures  aimed  at  better  'structuring  the 
cooperation  with  law  enforcement  or  judicial  authorities  (11  times).  The  expected 
results  of  such  measures  range  from  enhancing  the  information  flaw  (in  22 
occurrences),  to  better  targeting  checks  (14),  enhancement  of  coordination  (11)  and 
cooperation (9), targeting of investigations (9) and enhanced ex-post (9 ) and ex-ante 
controls (8). 

2 

CROSS-CUTTING ANTI-FRAUD INITIATIVES AND MEASURES BY MEMBER STATES 

In 2017, 17 horizontal measures were adopted by Member States. 

The  present  chapter  will  focus  on  the  horizontal  measures  adopted  by  the  Member 
States in 2017, which were reported via the questionnaire.  

Paragraph  2.1  deals  with  the  development  of  National  Anti-Fraud  Strategies, 
considering  its  horizontal  impact  on  the  systems  of  protection  of  the  EU  financial 
interests in Member States. It is mainly an update of information already provided in 
the same Commission Staff Working Document accompanying the PIF Report 2016. 

Paragraphs from 2.2 to 2.4 focus on specific topics/themes addressed by the measures 
adopted by Member States. 

2.1 

PROGRESS ON THE DEVELOPMENT OF NATIONAL ANTI-FRAUD STRATEGIES

1

 IN 2017  

By the end of 2017, a total of ten Member States had adopted a National Anti-Fraud 
Strategy  and  transmitted  it  to  the  Commission2.  The  Commission  invites  all  other 
Member States to follow such example and establish NAFS based on the Guidelines 
prepared (in collaboration with Member States experts).  

In  reply  to  the  PIF  questionnaire  2017,  two  more  Member  States  informed  the 
Commission  of  having  adopted  a  NAFS,  but  this  has  not  been  communicated  yet. 
Another  Member  State  informed  the  Commission  of  having  adopted  a  sectorial 
antifraud strategy (Customs)3. 

1  

2  

The Commission invites Member States to consult the General Guidelines on National Anti-Fraud Strategies 
when starting the procedure of establishing a NAFS.  
The  ten  Member  States  are:  Bulgaria,  Croatia,  Czech  Republic,  France,  Greece,  Hungary,  Italy,  Latvia, 
Malta  and  Slovakia.  Austria,  Lithuania  and  Portugal  replied  to  the  questionnaire  that  they  have  adopted  a 
National AntiFraud Strategy, but it is either a sectoral strategy or they have not communicated it officially to 
the Commission. Furthermore, Romania indicated that their strategy was applicable to a former programming 
period and are currently preparing a new one. Besides, Belgium, Estonia, Luxembourg and the Netherlands 
reported that the procedure to establishing a NAFS is on-going. 

3 See footnote 2. 

7 

 
 
                                                            
Figure 7: NAFS: State of play 

A National Anti-Fraud Strategy allows for structuring the fight against fraud affecting 
EU and national budgets at Member State level. It helps identifying vulnerabilities to 
fraud  in  the  systems,  assessing  the  main  fraud  risks,  setting  and  implementing 
adequate responses; evaluating progress made, adapting the response to the evolution 
of  the  fraud  trends  and  the  resources  available,  and  ensuring  the  involvement  of  all 
relevant  stakeholders  in  particular  by  means  of  enhanced  collaborative  and 
coordinated  actions.  A  NAFS  also  helps  to  ensure  harmonisation  of  the  response  to 
fraud  risks  throughout  the  country,  especially  in  the  case  of  a  decentralised 
management structure. 

The benefits of a National Anti-Fraud Strategy include: 

  Ensuring the effective and efficient protection of the EU financial interests (i.e. 
improving  the  prevention,  detection  and  fight  against  corruption  and any  other 
illegal activities affecting the financial interests of the Union); 

  Setting out a better working framework upon which the institutions involved in 
the process of implementation and control of EU funds could work together to 

8 

 
 
 
improve  administrative  capacity  and  determine  more  precisely  the  roles  and 
responsibilities  of  the  institutions  involved.  This  would  ensure  effective  co-
ordination  of  legislative,  administrative  and  operational  activities  of  the 
institutions; 

  Achieving a higher degree of recovery of unduly spent funds from the budget of 
the  European  Union  and  contributing  to  proportionate  and  dissuasive  penalties 
in accordance with the applicable law. 

2.1.1  BACKGROUND TO NAFS 

The  new  Multiannual  Financial  Framework  applicable  to  the  programming  period 
2014-2020  has  been  strengthened  as  regards  fraud  risk  assessment,  fraud  prevention 
and  detection.  For  shared  management  the  sectoral  Regulations  require  Member 
States: 

 

 

to  put  in  place  effective  and  proportionate  anti-fraud  measures,  taking  into 
account the risks identified,  

to  take  the  necessary  steps  to  prevent,  detect  and  sanction  fraud  and 
irregularities effectively and  

 

to reimburse irregular amounts to the EU budget.  

However, going beyond the immediate regulatory requirements and embedding these 
anti-fraud measures in a National Anti-Fraud Strategy (NAFS) is encouraged in order 
to  ensure  better  monitoring  of  the  fight  against  fraud  detrimental  to  the  financial 
interests of the EU and that of the Member States, as well as to ensure homogenous 
the  organisational  structures  are 
and  effective  practices,  especially  where 
decentralised. 

2.1.2  GUIDING PRINCIPLES 

In  the  last  three  years,  the  COCOLAF  Fraud  Prevention  Group  focused  on  various 
aspects  of  the  NAFS  topic.  First,  as  a  pilot  project,  the  working  group  in  2014 
prepared  the  'Guidelines  for  National  Anti-Fraud  Strategies  for  European  Structural 
and Investment Funds (ESIF)'. These guidelines laid down the foundation for drafting 
a  National  Anti-Fraud  Strategy,  however  with  a  limited  scope  on  expenditure  in  the 
field  of  ESIF.  In  the  following  year,  another  working  group  was  set  up  to  target  the 
practical  side  of  NAFS.  As  a  result,  in  2015  the  document  called  'Practical  steps 
towards  drafting  of  a  National  Anti-Fraud  Strategy'  was  issued  together  with  a 
practical tool in the form of an xls file that can be used to carry out the assessment of 
the state of play with regard to the current measures in place, taking into account all 
the four stages of the anti-fraud cycle.  

The current guidelines represent an update of the NAFS guidelines issued in 2014. The 
working group in 2016 aimed at revising as well as enlarging the previous guidelines 
for  the  NAFS  so  that  it  become  a  horizontal  document  covering  all  shared 
management  expenditure:  European  Structural  and  Investment  Funds  (ESIF), 
Agriculture, Home Affairs Funds (AMIF/ISF) and Fund for European Aid to the Most 

9 

 
 
Deprived (FEAD). In addition, the guidelines were enriched with a number of concrete 
examples of Member States' practice that have proven to be successful. 

2.2 

MEASURES  TO  ENHANCE  TRANSPARENCY  AND  FIGHT  CORRUPTION  AND  ANTI-
CONFLICT OF INTEREST IN PUBLIC PROCUREMENT 

Seven  measures  were  reported  which  addressed  the  issue  of  corruption  in  public 
procurement.  

Czech Republic - Public procurement and anti-corruption Act 
Beyond  the  procurement  directives  (national  level),  the  Public  Procurement  Act  provides 
mandatory evidence on the ownership structure of suppliers through: 

  Obligations  of  suppliers-public  limited  liability  companies  to  issue  exclusively 

uncertificated shares, 

 

the obligations of the contracting authorities to check the actual owners according to the 
law  on  selected  measures  against  the  legalisation  of  proceeds  from  criminal  activities 
and terrorist financing. 

The objective of Law 134/2016 was to increase transparency in the area of public procurement 
as  a  whole  and  to  improve  the  prevention  and  detection  of  fraud  and  corruption  in  public 
procurement. 

Estonia - Public procurement Act 
Estonia  adopted  a  new  legislative  framework  for  public  procurement  to  transpose  the  EU 
Directives  and  to  address  the  issues  related  to  public  procurement,  considered  the  most 
problematic area of expenditure.  

The  Public  Procurement  Act  was  passed  on  14  June  2017  and  entered  into  force  on  1st 
September  2017.  This  Act  provides  for  the  rules  of  public  procurement,  the  rights  and 
obligations of persons involved in public procurement, the rules of exercising state supervision 
and administrative supervision, review procedure, and the liability for violation of this Act.  

10 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionHTo remedy flawsNSinglePublic procurement; CorruptionLegislativeDefinition of a specific topic 
 
 
 
 
 
 
Spain – Electronic registry of anti-corruption trials 

In 2017, Spain implemented a data repository of corruption judicial proceedings in the country 
and made it available to the public online (accessible on the website of the General Council of 
the Judiciary). 

The measure aims at centralising and making available to the public the information on Spanish 
criminal proceedings relating to corruption offences (both proceedings that have concluded and 
those under way), broken down by type of offence, geographical area, etc. This information is 
public and can be taken into account by the competent authorities in their risk assessments. 

Cyprus –Measures and policies to combat corruption 
In many cases, the fraud is an outcome of corruption. It is very important to have a unified and 
holistic approach  to  the corruption  phenomenon  and  concrete  foundations  for  joint actions  of 
the entire state machine and the private sector to fight corruption and protect the EU financial 
interests. 

In  this  view,  Cyprus  put  forward  a  package  of  measures,  recommended  by  the  Ministry  of 
Justice and Public Order and include among others the following: 

  The setting of a National Anti- Corruption Strategy 
  Drafting and filing a Bill in parliament on Whistleblowers protection 

11 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReason for  measureHorizontal / sectoralPreventionDetectionCompetence; powers; definition of a specific topic; other administrative penaltiesTo enforce the rules in line with developments in EU lawHNPublic procurement; Corruption; Conflict of interestsSingleLegislativeAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measureHorizontal / sectoralPreventionOperationalNIT toolsEnhanced information flow; Improved knowledge of corruptionHCorruption; TransparencySingle 
 
 
 
 
 
 
 
  Drafting  and  filing  a  Bill  in  parliament  that  regulates  contacts  on  lobbying  and  the 
creation and maintenance of a register for the registration of persons involved in public 
decision-making executive and /or legislative power 

  Drafting of bill to set up an Independent Authority Against Corruption 

The bill was approved by the Parliament on March 30 2018. 

The  organisational  measures  aimed  at  enhancing 
the 
simplification of procedures, providing also to relevant staff general, but also, fraud awareness 
trainings. 

inter-agency  cooperation  and 

Malta – Addressing Fraud and Corruption in public procurement 
Malta  took  steps  to  address  Fraud  and  Corruption  in  Public  Procurement.  With  the  aim  to 
enhance  good  governance,  transparency  and  public  accountability,  in  2015,  the  Director  of 
Contracts  established  the  Compliance  and  Monitoring  Unit  (CMU).  In  May  2017  the  CMU 
prepared a report entitled "Addressing Fraud and Corruption in Public Procurement" with the 
intent  to  highlight  the  various  measures  being  adopted  by  the  Department  of  Contracts  to 
combat fraudulent activities in public procurement.   

Specific guidelines were adopted to clarify and consolidate existing rules. 

Romania - Public procurement 
Romania  adopted  a  package  of  measures  in  the  area  of  public  procurement.  Legislative, 
administrative, organisational and operational measures were put forward: 

12 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionCorruption; Conflict of interest; Whistleblower; Antifraud or anticorruption strategyPackageLegislativeN/APowers; financial penalties; criminal sanctions (new sanctions)OrganisationalNInter-agency cooperation; general trainings; fraud awareness trainings; simplification of proceduresto clarify or consolidate existing rulesIncreased resourcesHAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReason for  measureHorizontal / sectoralPreventionDetectionOther: The Department of Contracts, as a regulator, has embarked on a mission to further enhance good governance, transparency and public accountability.to clarify or consolidate existing rulesNHSinglePublic procurement; Antifraud or anticorruption strategyAdministrative 
 
 
 
 
 
 

 

 

in 

the 

function 

the  process 

the  adoption  of  a  new  legislative  act  in  the  field  of  ex-ante  control  of  the  award  of 
public-procurement  contracts/framework  agreements  (Emergency  Order  of 
the 
Government  of  Romania  No  98/2017  of  14  December  2017  concerning  the  ex-ante 
control 
award  of  public-procurement 
for 
contracts/framework  agreements,  sector-specific  procurement  contracts/framework 
agreements  and  concession  contracts  for  works  and  services,  published  in  Official 
Gazette of Romania No 1004 of 18.12.2017);  
the  issuing/updating  of  operational  procedures  at  management  authorities  level  and, 
namely,  internal  operational  procedures  at  the  level  of  some  managing  authorities, 
describing  in  detail  the  specific  activities  regarding  the  verification  of  public 
procurement  through  the  prism  of  identifying  possible  conflicts  of  interest  and  the 
incidence of fraud indicators; Ministerial Order on designating persons responsible for 
completing  and  updating  integrity  forms  (MADR  -  Ministry  of  Agriculture  and  Rural 
Development);  
the drawing up of guidelines for contracting authorities concerning conflicts of interest 
in  public-procurement  processes,  like  the  Guidelines  for  contracting  authorities 
concerning  conflicts  of 
(ANAP); 
Guidelines+code  of  ethics,  own  preventive  financial  control,  public  procurement 
(ANAP).  

in  public-procurement  processes 

interest 

  The Establishment of a conflict-of-interest prevention mechanism in the procedure for 
the  award  of  public-procurement  contracts  -  on 20  June  2017,  the  Prevention  System, 
established  by  Law  No  184/2016  on  the  establishment  of  a  conflict-of-interest 
prevention mechanism in the procedure for the award of public-procurement contracts, 
became operational making obligatory the completion of the Integrity Form; 

  Reorganisation of MADR bodies in order to apply the regulations regarding prevention. 

The underlying aim in promoting this legislative act is to enhance the efficiency and efficacy of 
ex-ante control, with a direct impact on the legality and quality of award procedures and on the 
creation  of  an  appropriate  competitive  environment  on  the  public-procurement  market. 
Furthermore, dedicated rules governing the ex-ante control of intended contractual amendments 
will  obviate  the  need  to  conclude  addenda  to  public/sectoral  procurement  contracts  or 
concessions which could distort competition and transparency. 

13 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReason for  measure / expected resultsHorizontal / sectoralPreventionLegislativeNTo remedy flawsDetectionAdministrativeN/ATo clarify or consolidate existing rulesInvestigation and prosecutionOrganisationalNReorganisation of existing bodies; competence; OtherNeutral on resourcesRecovery and sanctionOperationalAIT tools (ARACHNE)Enhanced information flowPublic procurementPackagePublic procurementH 
 
 
 
 
 
Romania – Anti- corruption strategy 
Romania  adopted  a  Package  of  (legislative,  administrative,  organisational,  operational) 
measures  to  implement  the  National  Anti-Corruption  Strategy  2016-2020  approved  by 
Government  Decision  No  583/2016, 
levers  and  means  for 
implementing/monitoring such strategy. The following measures were adopted: 

to  establish 

the  main 

 

In  order  to  implement  the  National  Anti-Corruption  Strategy  2016-2020  approved  by 
Government Decision No 583/2016, the Ministry of the Interior issued Interior Minister 
Order No 72 of 15 June 2017 approving the Integrity Plan for the implementation of the 
National Anti-Corruption Strategy at Ministry of the Interior level over the period 2017-
2020. 

  The  Minister  of  Justice  Order  No  1361/C/2017  approving  the  Methodology  for 
Monitoring  and  Implementing  the  National  Anti-Corruption  Strategy;  Plan  for 
preventing  irregularities  and  fraud  at  AFIR  level  and  analysis  of  appropriateness  of 
implementation  of  ISO  37001:2016  -  Anti-Corruption  Management  System;  Plan  for 
anti-fraud measures/control at MA ACOP level using the instrument recommended by 
the European Commission – EGESIF 14 0021-00. 

  At  MA  ROP  level,  a  first  fraud-risk  self-assessment  was  carried  out  in  2017  and  an 
action plan put in place, within the framework of the fraud-risk assessment group GERF 
(Grupul  de  evaluare  a  riscului  de  frauda).  This  is  a  first  step  in  fraud-risk  self-
assessment  at  the  level  of  the  directorates  involved.  The  risks  will  be  monitored  and 
tracked  by  means  of  a  risk  tracking  sheet,  and  will  be  correlated  with  the  general 
register of risks identified at MA ROP level.  

  Operational measures were taken at MA ROP level in order to implement the National 
Anti-Corruption Strategy 2016 2020 approved by Government Decision No 583/2016. 
These measures are aimed at: 

o  enhancing  institutional  transparency  by  posting  on  the  website  information  of 
public interest relating to the activities of the Project Payments and Accounting 
Directorate; 

o  consolidating administrative control mechanisms; 
o  drawing  up  the  progress  report  on  implementation  of  the  National  Anti-

Corruption Strategy nsolidating administrative control mechanisms. 

14 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReason for  measure / expected resultsHorizontal / sectoralPreventionLegislativeNAnti-fraud or anti-corruption strategyTo clarify or consolidate existing rulesDetectionAdministrativeN/AMonitoring/desk checks; otherotherOrganisationalAOtherNeutral on resourcesOperationalAOtherEnhanced information flow; enhanced ex-post controlsAnti-fraud or anti-corruption strategyPackageH 
 
 
 
 
2.3 

MEASURES AGAINST FINANCIAL AND ORGANISED CRIME 

Czech Republic – Working Group on the setting up of the EPPO 
The  Czech  Republic  set  up  a  working  group  to  ensure  the  functioning  of  the  European 
Prosecutor’s Office in the Czech Republic - following the adoption of Council Regulation No 
2017/1939  of  12  November  2017  and  Directive  (EU)  2017/1371  of  the  European  Parliament 
and of the Council of 5 July 2017 a working group was set up by the relevant Czech authorities 
to  ensure  that  the  necessary  steps  are  taken  to  enable  this  office  to  function  in  future.  The 
members of this expert group include state prosecutors from the Supreme Prosecutor’s Office, 
the High Public Prosecutor's Offices and officials from the Ministry of Justice.  

The  European  Prosecutor’s  Office  will  in  future  be  one  of  the  key  bodies  involved  in  the 
prosecution of criminal offences against the financial interests of the Union. It is, therefore, in 
the interest of both the European Union and the Czech Republic to create the conditions for its 
proper functioning and to address the necessary issues related to modifications of national law 
and the logistic aspects of the functioning of those prosecutors in the Czech Republic. 

Czech Republic – Appointment of a liaison officer at EUROPOL 
The  Czech  Republic  appointed  a  liaison  officer  of  the  Czech  Customs  Administration  at 
EUROPOL.  

According to the Czech authorities, the appointment of a liaison officer of the Czech Customs 
Administration  at  EUROPOL  will  reinforce  the  successful  functioning  of  the  law  enforcing 
entities within the remit of the Czech Customs Administration in criminal proceedings. Closer 
cooperation  with  EUROPOL  should,  inter  alia,  contribute  to  improving  conditions  for  a 
successful protection of the Union’s financial interests. 

15 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionRecovery and sanctionReorganisation of existing bodies; competence; inter-agency cooperationincreased resourcesHNFinancial crime; Organised crime; shared management and control of EU funds; antifraud or anticorruption strategySingleOrganisational 
 
 
 
 
Greece - Reorganisation of the structures of the Ministry of Finance 

On  November  23  2017,  Presidential  Decree  No  142/2017,  Chapter  VII,  Articles  79-83 
(Government Gazette, Series I, No 181/23.11.2017) was adopted. 

The  legislative  measure  established  the  responsibilities  of  the  Special  Secretariat  for  the 
Financial and Economic Crime Unit (SDOE), further to Law 4336/2015. Section A - Strategic 
Planning  (Article  79(3)(a))  of  the  Central  Service  -  Directorate  for  Strategic  Planning  and 
Investigation Planning, the Section for Control of National and EU Expenditure and the Anti-
Fraud and Corruption Section of the Operational Directorates of Attica (Article 82(4)(c)(i) and 
(ii)) and Macedonia (Article 83(4)(b)(i)) have responsibilities that relate to combating fraud and 
corruption. 

The purpose of the Special Secretariat for the Financial and Economic Crime Unit (SDOE) is to 
expose and combat outbreaks of financial crime, control capital movements and the possession 
and movement of prohibited items and substances, check the implementation of provisions on 
national  and  EU  subsidies  and  grants,  expose  cases  of  corruption  and  fraud  and  check  the 
implementation of provisions on the protection of public property, with the aim of preventing 
infringements and illegal acts, ensuring voluntary compliance and prosecuting liable offenders. 

Poland adopted on 10 February 2017 The Act amending the Criminal Code and other Acts. 

Poland – Amendment of criminal code and other acts 

The Act makes VAT fraud subject to specific regulations laid down in ordinary criminal law. It 
focuses on preventing and combating crime which involves the creation of incorrect/inaccurate 
documents  relating  to  circumstances  that  could  be  relevant  for  the  purpose  of  determining 

16 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionHincreased resourcesNInter-agency cooperationFinancial crime; Organised crimeSingleOrganisationalAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measureHorizontal / sectoralDetectionInvestigation and prosecutionRecovery and sanctionTo clarify or consolidate existing rules; otherHACompetencesFinancial crime; Customs/TOR/illicit trade; shared management and control of fundsSingleLegislative 
 
 
 
 
 
public-law  liabilities.  This  gives  rise  to  VAT  fraud  with  a  very  significant  impact  on 
government finances. 

The bill aims at introducing effective instruments to combat VAT fraud, reducing the scale of 
VAT fraud and increasing budget revenue from VAT. 

Lithuania – Annual expert meetings of the Baltic States of Tax and Customs Crime 
Investigation Services 

This measure is partially based on the Action Plan of the Baltic States Customs Cooperation for 
2017-2019 and Europol EMPACT Excise Operational Action Plan. 

These meetings focus on cooperation between investigation units on sharing and exchange of 
best  practices  and  specific 
initiated  criminal 
investigations. 

information  on 

trend-based 

latest 

the 

Baltic investigation services are operating at the external EU border where they face challanges 
in fighting excise fraud due to extreme price difference in neighbouring countries. Therefore, 
better cooperation among respective law enforcement services is crucial in order to implement 
the  protection  of  the  EU  financial  interests  and  better  prevention  of  economic  fraud.This 
measure  is  included  into  EMPACT  Excise  Operation  Action  Plan  as  Operational  Action  1.6 
‘Baltic  states  focusing  on  organized  crime  groups  smuggling  excise  goods  via  numerous 
metmethods’ is led by Lithuania. 

This  measure  seeks  to  bring  together  experts  from  the  participating  member  states  (EE,  LV, 
LT, SE, PL) as well as Europol and Frontex to share intelligence on trends, active OCGs and 
current  and  emerging  modus  operandi.  Participants  share  their  experience  to  identify  and 
propose ways in which these threats can be tackled. Intelligence gathered will also be used for 
future operational activities. 

17 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionRecovery and sanctionTo clarify or consolidate existing rules; to remedy flawsHLegislativeAdefinition of a specific topicFinancial crime; organised crimeSingle 
 
 
 
 
Slovenia - Prioritising detection and investigation of economic crime and strengthening 
interdepartmental cooperation 

In  Slovenia,  on  the  basis  of  guidelines  and  instructions  from  the  Minister  for  the  Interior 
regarding  the  drafting  of  the  Police  work  plan  for  2017,  the  police  prioritised  work  to  detect 
and investigate economic crime and criminal corruption, focusing on cases that hurt the budget 
and  EU  funds  and  on  crimes  where  the  suspects  are  holders  of  public  office,  and  enhancing 
cooperation between specialised and joint investigation task forces. 

Through  this  measure  the  police  is  seeking  to  increase  the  detection  and  clearance  rate  for 
crimes  that  cause  harm  to  the  EU,  partly  by  encouraging  state  bodies  responsible  for  control 
and  monitoring  to  recognise  and  report  suspected  criminal  offences  to  the  enforcement 
authorities. 

2.4 

OTHER MEASURES 

Latvia – Anti fraud campaing #FraudOff! 

In  2017,  Latvia  launched  a  series  of  measures  to  increase  public  awareness  about  fraud  and 
reporting  fraud,  as  well  as  to  increase  knowledge  and  expertise  of  people  who  work  on 
prevention, detection, investigation and prosecution of fraud and recovery and sanctions. In the 
end those measures help to protect EU financial interests. 

The following initiatives were conducted: 

18 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionFinancial crime; organised crime; Customs/TOR/illicit tradePackageCompetence; inter-agency co-operationIncreased resourcesSOperationalAFlagging practice; risk indicators; increased number of checks; structured cooperation with law enforcementEnhanced cooperation, information flow; targeting of checks and investigationsSOrganisationalAAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionInvestigation and prosecutionPublic procurement; financial crime; fraud definition; interdepartmental cooperation (other)SingleOperationalAIT tools; Web reporting/hotline; structured cooperation with law enforcement; structured cooperation with judicial authorities; cooperation with other control or monitoring bodies (other)enhanced coordination, cooperation and information flow; targeting of checks and investigationsS 
 
 
 
 
 
1.  a national antifraud campaign, denominated #FraudOff! This campaign unites the state 
institutions  and  companies  and  aims  at  increasing  public  awareness  about  fraud  and 
damages which it causes to national and EU budget4.   

2.  Implementation of the Project Hercule III: in 2017 two seminars were organised ("Tools 
for  combating  fraud  and  implementation  of  the  National  Anti-Fraud  strategy"  and 
"Methods  of  criminal  investigation  relating  to  fraud,  corruption  and  other  offences 
affecting the EU") and one study visit to Croatia, Zagreb. 

4 http://atkrapies.lv/ 

19 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionRecovery and sanctionPublic procurement; financial crime; corruption; conflict of interests; fraud definition; AFCOS; Whistleblower; Customs/ToR/Illicit trade; Shared management and control of EU funds; Antifraud or anticorruption strategySingleOrganisationalNInter-agency cooperation; General trainings; Fraud awareness trainingsIncreased resourcesS 
 
 
 
 
 
                                                            
Sweden – Legislation about OTS checks and OLAF investigations 

The  legislation  allows  competent  authorities  to  assist  Olaf  in  its  on  the  spot  checks  and 
inspections in Sweden. The legislation has been put in place to live up to requirements set out 
in Regulation 2185/96 and Regulation 883/2013. 
The  legislation  allows  competent  authorities  to  assist  Olaf  in  its  on  the  spot  checks  and 
inspections in Sweden. 

Sweden – guidelines on anti-fraud strategy 

The  Swedish  council  for  the  protection  of  EU:s  financial  interests  in  Sweden  (SEFI-council) 
has  formed  a  working  group  focusing  on  drafting  a  practical  document  to  be  used  as 
administrative  support  for  Governmental  authorities  managing  EU-funds  in  Sweden.  The 
objective  is  to  support  and  strengthen  the  antifraud  measures  of  the  authorities  as  well  as  to 
enable them to enact strategies/measures in the anti-fraud area. 

Through this measure and others, Sweden ensures an ongoing awareness of the importance of 
anti-fraud  measures  within  governmental  authorities  managing  EU-funds  in  Sweden.  Such 
measures also fit within the general crime-preventive measures that the Swedish government is 
engaged in.  

Sweden - The annual programme of the SEFI-council 

During  2017  The  Swedish  council  for  the  protection  of  EU:s  financial  interests  in  Sweden 
(SEFI-council)  among  other  things  has  facilitated  experience-sharing  regarding  anti-fraud 

20 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measureHorizontal / sectoralInvestigation and prosecutionRecovery and sanctionHTo enforce the rules in line with developments in EU lawCustoms/TOR/illicit trade; shared management and control of fundsSingleLegislativeNCompetences; powersAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionNeutral on resourcesHAFCOS; whistleblower; shared managemnet and control of EU fundsSOrganisationalNCompetence; inter-agency cooperation 
 
 
 
 
 
 
 
 
measures,  especially  drafting  antifraud  policies,  thereby  enabling  small  authorities  to  learn 
from and make use of progress made by larger governmental authorites. The SEFI council has 
also  hosted  thematic  seminars  on  a  number  of  anti-fraud  issues  to  increase  awareness  and 
knowledge among Swedish authorities. 

Through  this  measure,  or  measures  like  these,  Sweden  ensures  an  ongoing  awareness  of  the 
importance  of  anti-fraud  measures  within  governmental  authorities  managing  EU-funds  in 
Sweden. Such measures also fit within the general crime-preventive measures that the Swedish 
government is engaged in. 

3 

ANTI-FRAUD MEASURES COVERING BOTH REVENUE AND EXPENDITURE SECTORS 

3.1 

REVENUE AND EXPENDITURE 

Italy – Combating fraud affecting the EU budget 

To  combat  the  most  serious  and  dangerous  forms  of  crime,  in  2017,  Italy  took  measures  to 
combine administrative and penal initiatives which consist, once the fraud has been identified, 
in reconstructing the illicit financial flows and seizing the assets of criminal organisations with 
the eventual aim of dismantling them. 

The initiatives adopted provide for: 

  specific  ‘operating  plans’  for  combating  VAT  fraud,  and  the  embezzlement,  improper 
request  and/or  receipt  of  expenditure  disbursed  by  the  EU  for  the  2007/2013  and 
2014/2020 programmes; 

  with regard to VAT, special inspection campaigns aimed at identifying taxable entities 
that,  while  having  carried  out  various  transactions  with  suppliers  and/or  customers, 
failed to submit the necessary VAT declarations and information. 

21 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionAFCOS; whistleblowerPOrganisationalAinter-agency cooperation; fraud awareness trainingsNeutral on resourcesH 
 
 
 
4 

ANTI-FRAUD MEASURES IN REVENUE BY THE MEMBER STATES 

4.1 

FIGHT AGAINST CUSTOMS FRAUD 

Denmark – Internal guidance on OWNRES communications 

For 2017, Denmark reported having drawn up internal guidance on the procedure used by the 
Danish  tax authorities  (SKAT)  to  ensure  that  EU  own  resources  with  regard  to  customs  duty 
are paid correctly and in accordance with the applicable regulation. This guidance is a general 
description of rules and procedures governing the overall payment of EU own resources where 
customs duty is concerned. The guidance is constantly updated and is regarded as an important 
tool for ensuring uniform administration and compliance with the rules applicable in this area. 

Portugal – Increase of minimum fine for failure to declare the amount of cash carried 

On December 2017, Portugal adopted Law No 114/2017 approving the State budget for 2018 
and  amending  the  General  Law  on  Tax  Offences  [Regime  Geral  das  Infrações  Tributárias] 
approved  by  Law  No  15/2001  of  5  June  2001.  Through  this  legislative  act,  it  increased  the 
competent  authority’s  powers  and  capabilities  to  control  cash  movements;  improved 
declaration compliance; and provided a better picture and greater awareness of cash movements 
and the main players involved. 

The  minimum  fine  applicable  was  increased  from  EUR  250  to  EUR  1000  in  cases  of 
infringement of travellers’ legal obligation to declare the amount of cash carried in line with the 
Financial Action Task Force (FATF-GAFI) Recommendations.  

22 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionShared management and control of EU funds; VAT fraudSingleOperationalNRisk indicators; structured cooperation with judicial authorityEnhanced coordination; enhanced information flow; targeting of checks; targeting of invstigations; enhanced ex-post controlsSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionSmuggling/Illicit tradeSingleAdministrativeNMonitoring/desk checksto clarify or consolidate existing rulesS 
 
 
 
 
 
 
Portugal - Transport and declaration for a customs-approved treatment or use 

Portugal  also  approved  a  package  of  meausres  (administrative  and  operational)  concerning  
transport  and  declaration  for  a  customs-approved  treatment  or  use,  allowing  for  risk  analysis 
using electronic data processing techniques with the aim of identifying and assessing the risks 
and establishing counter-measures required. 

This  package  of  measures  made  it  possible  to  implement  risk  assessment  measures  that  are 
integrated in a national risk management and anti-fraud strategy5. 

In this way, it is expected that ex-ante controls will result improved, as will coordination and, 
the necessary information flow. 

Netherlands –Undervaluation of import declarations 

To contrast financial crime, namely the low value approach in import declarations, particularly 
in  the area of textiles from China and other countries of origin and given the major  financial 
interests  and  the  problems  identified  in  this  area,  the  Netherlands  updated  in  2017  an 
organisational  measure  aimed  at  refining  risk  indicators  in  the  area,  to  better  target 
investigations and checks in a framework of increased controls.  

5 This initiative follows-up on the previous year establishing a National Risk Assessment Centre (see SWD(2017) 

270 final, page 35. 

23 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measureHorizontal / sectoralPreventionDetectionFinancial crime; organised crime; customs/ToR/illicit tradeSingleLegislativeAFinancial penaltiesTo clarify or consolidate existing rulesSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionPackageAdministrativeAMonitoring/desk checks; on the spot checksto enhance existing measureSOperationalAIT toolsEnhanced coordination; enhanced information flow; enhanced ex-ante controlsSFinancial crime; organised crime; customs/ToR/illicit trade 
 
 
 
 
 
 
                                                            
Portugal - National customs risk assessment 

Portugal linked up the entire goods-entry cycle to the national risk database (entry summary 
declaration,  declaration  for  temporary  storage  and  customs  declaration).  To  handle  this  risk-
analysis,  assessment  and  mitigation  work  relating  to  safety,  security  and  financial  fraud,  a 
National  Risk  Assessment  Centre  became  fully  operational;  open  16  hours  a  day,  six  days  a 
week, with increased staff numbers. This measure targeted the prevention and detection stages 
of the anti-fraud cycle in the areas of financial crime, organised crime, smuggling/illlicit trade. 

Finland – Customs plan to tackle the grey economy (2016-2020) 

Finnish  Customs  has  drafted  an  internal  plan  to  tackle  the  grey  economy,  which  contains  23 
different projects for the period 2016 to 2020. Customs’ own plan can be divided into plans for 
legislative cooperation, organisational plans and the development and targeting of operations. 
The aim is to effectively combat the grey economy and the damage to society and businesses 
caused by unfair competition. Customs’ efforts to tackle the grey economy will also focus on 
combating and investigating fraud affecting the EU budget. 

The  action  programme  to  tackle  the  grey  economy  and  financial  crime  more  effectively  was 
established  by  a  Government  decision  in  principle.  The  extra  funding  provided  in  this 
framework  has  all  been  channelled  into  human  resources  in  different  parts  of  the  Customs 
administration. In the period 2012-2017, Customs recovered EUR 214 million for the State on 
the  basis  of  company  audits  and  documentary  checks.  Meanwhile,  the  social  impact  of 
Customs’ campaign to tackle financial crime totalled EUR 167 million. The number of cases of 
tax fraud uncovered and investigated by Customs in 2012-2017 also increased by over 105% 
(from 529 to 1086). 

24 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionRecovery and sanctionCustoms/ToR/illicit tradeSingleOrganisationalARisk indicators; increased number of checksenhanced coordination, cooperation, informatoin flow and ex-ante controls; targeting of checks and investigationsSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionFinancial crime (including money laudering); organised crime; smuggling/illicit tradePackageOrganisationalReorganisation of existing bodies; competence; simplification of proceduresNeutral on resourcesOperationalIT tools; flagging practice; risk indicators; increased number of checksEnhanced coordination, cooperation & information flow; targeting of checks & investigationsASAS 
 
 
 
 
 
 
In particular, an export procedure is laid down for fuel consignments to be transported by sea. 
This is completed while the ship is still in Finnish territory. Similarly, a movement of goods for 
export under suspension of duty that is open in the EMCS system is completed when the ELEX 
system issues an electronic confirmation of export to the EMCS system. The fuel consignment 
can then be transported on EU territory without customs supervision. Tax problems of fictitious 
exports are also associated with other products subject to excise duty. 

The  proposed  measures  also  encompass  the  deployment  of  specific  tools  to  encourage 
whistleblowing, targeted trainings to raise fraud awareness and the enhancement of structured 
cooperation with law enforcement. 

Belgium – Policy plan of the General Administration of Customs and Excise – Strategic and 
operational priorities for 2015-2019 

The Policy Plan of the Belgian General Administration of Costums and Excise – Strategic and 
operational priorities for 2015-2019 includes a specific chapter dedicated to Combating Fraud / 
Fiscal Competencies: Customs Fraud - Antidumping and countervailing duties; and within this 
chapter, a measure is devoted to the exploitation of OLAF reports on fraud. 

In  addition  to  import  duties,  additional  anti-dumping  and  countervailing  duties  are  levied  on 
imports  of  products  manufactured  in  low-wage  countries  to  prevent  these  products  from 
arriving on the EU market at dumped prices and distorting trade. If fraud is suspected, OLAF 
sends out MA notices instructing the Member States to launch investigations. Actions: use the 
information from OLAF on fraud committed. When the anti-dumping and countervailing duties 
are published, checks will be carried out pro-actively to put a swifter end to any abuses. 

25 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionLegislativeAOtherto clarify or consolidate rules; to remedy flows; to enforce the rules in line with developments in EU lawDetectionAdministrativeN/AMonitoring/desk checks; on the spot checks; investigation; irregularities reportingto clarify or conslidate existing rules; to enhance existing measure; cross-cutting measureInvestigation and prosecutionOrganisationalAinter-agency cooperation; general trainings; fraud awareness trainingsNeutral on resourcesRecovery and sanctionOperationalAWeb reporting/hotline; structured cooperation with law enforcementenhanced cooperation, information flow, ex-ante and ex-post controls; targeting of checks and investigationsSFinancial crime; whistleblowers; customs/ToR/Illicit tradePackageAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionInvestigation and prosecutionAdministrativeOperationalMonitoring/desk checks; investigationIT tools, Risk indicatorsto clarify or consolidate existing rulesSEnhanced coordination; targeting of checks; targeting of investigationsSAAFinancial crime; Anti-Fraud or Anti-corruption StrategyPackage 
 
 
 
 
 
France - pilot data mining project in the area of customs and tax fraud 

French  Directorate-General  for  Customs  and  Indirect  Taxation  (DGDDI)  set  up  a  pilot  data 
mining project in the area of customs and tax fraud. Its aim is to detect new patterns of customs 
fraud.  An  experiment  has  been  under  way  since  summer  2017  to  test  these  tools  on  cases  of 
industrial use in the area of customs clearance. On the basis of the results obtained, it will be 
considered whether to extend the process to other areas. Checks made as part of this experiment 
enabled customs infringements to be identified.  

The first stage of the experiment concerned fraud relating to customs clearance. On the basis of 
the  relevance  of  the  results  obtained,  it  will  be  considered  whether  to  extend  the  process  to 
other areas (in particular taxation) and whether to develop the work of the datamining unit. 

The aim of the experiment is: 

 

 

to test the appropriateness of the new tools for mass data analysis in order to introduce 
new targeting methods. In the first stage, these analyses will enable ex-post checks to be 
assessed  (ex-post  1  and  investigations).  However,  in  time,  selection  profiles  can  be 
introduced in the targeting engine for declarations in the customs clearance application, 
on the basis of the patterns of fraud detected. 
to  have,  in  time,  a  data-scientist  unit  with  the  capacity  to  cooperate  with  the  customs 
analysts  in  the  Risk  Analysis  and  Targeting  Department  (SARC)  in  all  their  areas  of 
competence (pre-clearance, clearance and taxation). 

France - strategy for better reporting of customs fraud in the Anti Fraud Information System 
(AFIS) 

OLAF stresses the need to improve the quantity and quality of information exchanged through 
the  Customs  Information  System  (SID)  and  the  Customs  Investigation  Files  Identification 
Database (FIDE). Their aim is to coordinate the activities of these authorities and of OLAF in 
AFIS.  To  this  end,  the  Directorate-General  for  Customs  and  Indirect  Taxation  (DGDDI) 
established a specific strategy aimed at:  

i. 
ii. 

organising the activities of these departments for better reporting; 
guiding the activities of the customs services in using risk analysis applications in AFIS 
(directory of messages on the status of containers and imports, exports and transit). 

26 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionInvestigation and prosecutionOrganised crime; Customs /ToR /illicit tradePackageAdministrativeNOn the spot checks; investigation; irregularity reporting; otherOtherSOrganisationalNCompetenceIncreased resourcesS 
 
 
 
 
 
 
In the end, this measure follows on from those highlighted in the OLAF PIF 2015 questionnaire 
(2nd  and  3rd  measures  relating  to  national  supervision  of  the  OWNRES-Web  system  and  to 
follow-up of cases of mutual assistance). 

Germany - Establishment of a General Customs Directorate 

The General Customs Directorate (GZD) was established by the Law on the reorganisation of 
the  Customs  administration  of  3  December  2015.  The  Federal  supreme  Authority  has  its 
headquarters in Bonn and maintains additional service seats at a large number of locations in 
the  federal  territory,  including  those  of  the  former  federal  directorates  and  the  BWZ  in 
Hamburg, Potsdam, Cologne, Neustadt A.d.W., Nuremberg and Münster. 

The GZD is structured in nine directorates with departments, units and working areas. Its tasks 
are carried out by a total of approximately 7,000 employees. 

Spain - Amendment of the General Regulation on the Application of Taxes 

In 2017, Spain amended the General Regulation on the Application of Taxes by Royal Decree 
1070/2017 of 28 December 2017. Although this Regulation refers to taxes in general, it will be 
particularly important in terms of its application to  the protection of the financial interests of 
the EU. 

It supplements, develops and clarifies the legal rules establishing the possibility of assessing the 
debt and pursuing recovery measures, always in accordance with tax legislation, even in cases 

27 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionFinancial crime; organised crime; Customs /ToR /illicit tradePackageAdministrativeNInvestigation; irregularity reporting; otherTo clarify or consolidate existing rules; to enhance existing measure; cross-cutting measure, multi-agency measure/ measure with impact on various bodiesSOrganisationalNOtherotherSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReason for  measureHorizontal / sectoralPreventionDetectionInvestigation and prosecutionRecovery and sanctionCustoms / ToR / Illicit tradeSingleOrganisational NReorganisation of existing bodiesIncreased resourcesS 
 
 
 
 
 
 
 
 
in  which  there  is  a  criminal  complaint,  without  the  need  to  suspend  the  administrative 
procedure of assessment and collection until there is a criminal judgment. 

Preferential  application  of  EU  legislation  is  ensured  when  the  procedure  relates  to  customs 
debts, in two specific aspects: 

  Existence of co-debtors, where it is specified that notification of the debt shall be valid 
for each of them provided their right to be heard has been guaranteed and regardless of 
whether there are other debtors; 

  The right to be heard in national proceedings, which must, in all cases, be carried out in 
accordance with EU legislation, given the multitude of national provisions which cause 
confusion with EU provisions. 

Italy – Post Clearance Audit (PCA) 

Italy  implemented  a  new  Post-Clearance  Audit  method,  based  on  audit  methodologies.  The 
method  encompasses  checks  on  economic  operators  for  compliance  with  national  and  EU 
regulations and obligations in all sectors associated with the customs authority. 

This  new  Post-Clearance  Audit  method,  based  on  an  approach  consisting  of  inspections 
concerning the entire activity of the selected economic operator, examining its administration, 
organisation and internal audit procedures and/or systems. The purpose of this kind of audit is 
both preventive and punitive, to ensure that provisions of the Customs Code and of the related 
EU tax law are properly fulfilled. 

The  adoption  of  this  Post-Clearance  Audit  method  involved  the  issuing  of  administrative 
directives,  based  on  EU  guidelines,  as  well  as  the  territorial  breakdown  of  checks  to  be 
performed at local level based on a prior central analysis that identified the sectors most at risk. 

28 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralRecovery and sanctionrecoveryTo clarify or consolidate existing rulesSACustoms / ToR / Illicit tradeSingleLegislative 
 
 
 
 
 
Slovenia – Combating tax fraud and tax evasion and preventing aggressive tax planning 

Slovenia  adopted  the  Act  Amending  the  Tax  Procedure  Act  (ZDavP-2J)  (addition  of  a  new 
Chapter III.B entitled ‘Rules on reporting and the exchange of country-by-country reports’). On 
that  basis  the  Rules  on  the  implementation  of  the  Tax  Procedure  Act  have  been  amended  as 
well.  As  regards  the  exchange  of  financial  account  information,  the  Act  Amending  the  Tax 
Procedure Act (ZDavP-2I) and the Rules on the implementation of the Tax Procedure Act. 

Greece – Organisation, structure and operation of the Coordination Operational Centre 

Greece  adopted  a  Decision  by  the  Independent  Authority  for  Public  Revenue  laying  down 
matters  regarding  the  organisation,  structure  and  operation  of  the  Coordination  Operational 
Centre (SEK) set up by Article 6(1) of Law 4410/20166. 

The  Coordination  Operational  Centre  (SEK)  operates  as  a  coordination  centre  between  the 
departments to tackle the smuggling of products subject to excise duty. It recommends strategic 
plans  to  deal  with  smuggling  in  alcohol,  oil  and  tobacco  products,  operational  plans  for  joint 
inter-departmental  or  inter-State  actions,  legislative  initiatives,  measures  to  improve  the 

6 Government Gazette, Series I, No 141 

29 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionSCustoms / ToR / Illicit tradePackageAdministrativeNMonitoring/desk checks; On the spot checks; Audit checklist; Investigation; Irregularities reporting; Penalty; Recovery; OtherTo enhance existing measureRecovery and sanctionOrganisationalAGeneral trainings; fraud awareness trainingsNeutral on resourcesEnhanced information flow; enhanced ex-post controlsRisk indicators; increased number of checksAOperationalSSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionLegislativeACompetences; Definition of a specific topicto enforce the rules in line with developments in EU lawDetectionAdministrativeAMonitoring/desk checksto enhance existing measureInvestigation and prosecutionOrganisationalNfraud awareness trainingsNeutral on resourcesRecovery and sanctionOperationalAIT tools;  Risk indicators;Increased number of checks Enhanced information flow; Targeting of checks; Targeting of investigations; Enhanced ex-ante controls; Enhanced ex-post controlsCustoms/TOR/illicit trade; shared management and control of EU funds; OtherPackageS 
 
 
 
 
 
 
 
 
                                                            
effectiveness and quality of checks and investigations carried out by the prosecution authorities 
involved, assesses incoming information, etc. 

4.2 

FIGHT AGAINST TAX EVASION AND VAT FRAUD 

Belgium – Optimisation of the exchange and use of tax information 

Belgium  reported  about  a  cooperation  protocol  between  the  Anti-Fraud  Coordination  Service 
(ACOS/CAF) within the Federal Public Service - Finance (FOD Financiën) and the Financial 
Intelligence Processing Unit  (CFI) to optimise the  exchange and use  of tax information.  This 
Protocol aims to optimise the spontaneous and reciprocal exchange of relevant information; the 
use of data which may be exchanged by according the CFI direct access to certain databases of 
the Federal Public Service - Finance in order to combat money laundering and the financing of 
terrorism.  

Latvia reinforced its legislation to fight against tax fraud through: 

Latvia –Tax fraud prevention 

1)  Amendments  of  Road  traffic  Law-  with  aim  to  prevent  fraud  with  VAT  in  trade  of 

vehicles and developed accompanying Cabinet regulation;  

2)  Amendments  in  Law  Of  the  Enterprise  Register  of  the  Republic  of  Latvia  -  which 
allows  Enterprise  register  to  refuse  to  register  enterprise  if  the  information  from  tax 
authority has been received that this company has a tax risk. 

The adopted measures: 

30 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionInvestigation and prosecutionCustoms / ToR / Illicit tradeSingleAdministrativeNOn the spot checks; InvestigationTo clarify or consolidate existing rules; to enhance existing measureSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionFinancial crimeSingleOrganisationalAInter-agency cooperationIncreased resourcesS 
 
 
 
 
 
 
 
 
  ensure reinforced control of vehicles from risk group,  
 
 

improve fight against VAT fraud,  
improve  competition  and  restricts  unregistered  commercial  activity  in  the  field  of 
vehicle trade.  

Second amendments were made to restrict the possibility for taxpayers who are unfair to pursue 
their economic activity, thus protecting the budget, including the VAT field. 

Amendments to the Road traffic Law: CSDD can register (with conditions stipulated in Law) 
the ban on expropriation for a period of 15 days at the same time as the vehicle registration, and 
the information  about the  registered vehicle is transferred to the SRS, which  initiates  or  does 
not initiate tax administration measures;  

Amendments  in  Law  Of  the  Enterprise  Register  of  the  Republic  of  Latvia  which  allows 
Enterprise register to refuse to register enterprise if the information from tax authority has been 
received that this company has a tax risks. 

5 

5.1 

ANTI-FRAUD MEASURES BY MEMBER STATES - EXPENDITURE 

Measures covering several shared management sectors 

5.1.1  Agriculture, Fisheries, Cohesion policy 

Bulgaria – Legal framework for determining financial corrections in case of irregularities 

The  Regulation  on  indicating  irregularities  constituting  grounds  for  making  financial 
corrections  and  the  percentage  indicators  for  determining  the  amount  of  financial  corrections 
under the requirements of the European Union Structural and Investment Funds Management 
Act  was  adopted  by  Council  of  Ministers  Decree  No  57  of  28  March  2017.  A  clear  legal 
framework for determining financial corrections in cases of irregularities has been put in place. 

Under  Article  143(1)  of  Regulation  No  1303/2013,  Member  States  are  responsible  for 
investigating  irregularities  and  for  making  the  financial  corrections  required  and  pursuing 
recoveries.  Under  Article  122(2)  of  Regulation  No  1303/2013,  Member  States  shall  prevent, 
detect and correct irregularities and recover amounts unduly paid. As formulated, the Member 
States’  obligation  has  at  its  centre  the  obligation  of  proving  an  irregularity  has  occurred  and 
recovering  all  amounts  unduly  paid,  with  the  goal  of  restoring  the  situation  that  would  have 
existed had the irregularity not occurred. 

31 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionMonitoring/desk checksTo clarify or consolidate existing rules;Cross-cutting measure, multi-agency measure/ measure with impact on various bodiesSFinancial crime; otherPackageLegislativeN/ACompetences; powersto remedy flaws; otherSAdministrativeN 
 
 
 
 
 
The Council of Ministers Decree No 57 of 18 March 2017 specifies the types of irregularities 
constituting  a  breach  of  the  applicable  law  through  the  beneficiary’s  acts  or  omissions  and 
which  result  or  may  result  in  damage  to  funds  from  the  European  structural  and  investment 
funds, and which constitute grounds for making a financial correction under Article 70(1)(9) of 
the  European  Union  Structural  and  Investment  Funds  Management  Act,  as  well  as  the 
minimum  and  maximum  rates  of  the  percentage  indicators  for  financial  corrections  set  for 
irregularities pursuant to Article 70(1). 

Croatia – Irregularity and fraud risk assessment 

In  Croatia,  the  Service  for  combating  irregularities  and  fraud  conducted  an  irregularity  and 
fraud  risk  assessment  exercise  in  line  with  the  Irregularity  and  Fraud  Risk  Management 
Methodology.  The  risk  assessment  was  performed  at  bodies  of  Management  and  Control 
Systems  for  operational  programmes  financed  from  Cohesion  Fund,  European  Regional 
Development  Fund  and  European  Social  Fund,  AFCOS  network  bodies  and  the  Service  for 
combating irregularities and fraud. The results of the risk assessment will serve as a basis for 
the formulation of the new National Anti-Fraud Strategy. 

This  measure  will  allow  enhancing  administrative  capacities  in  the  area  of  fraud  risk 
management  and  implementing  efficient  and  effective  anti-fraud  measures;  it  provides 
instructions and tools for irregularity and fraud risk management.  

Croatia – Training needs analysis methodology 

In Croatia, SCIF drafted the "Training needs analysis methodology" in the field of managing on 
irregularities  for  the  period  2017-2019  and  accordingly,  conducted  training  needs  analysis 
among  the  employees  involved  in  the  tasks  connected  with  the  management  and  use  of  EU 

32 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionRecovery and sanctionPublic procurement; Shared management and control of EU fundsSingleLegislativeNPowers; recoveryTo clarify or consolidate existing rules SAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionAFCOSSingleAdministrativeAManagement of the fundsto enhance existing measuresS 
 
 
 
 
 
 
 
 
funds.  Also  a  'Catalogue  of  educational  activities'  was  established  consisting  of  all  the  topics 
for  which  trainings  will  be  conducted  for  a  three  year  period.  In  2017  three  educations  were 
held. 

One  of  the  Service's  responsibilities  is,  among  others,  the  preparation  of  strategic  documents 
for the performance of trainings to be delivered to the bodies within the AFCOS system in the 
field of managing on irregularities and protection of the EU financial interests with the aim of 
further enhancing of the Management and Control System bodies employees' knowledge. It is 
of the utmost importance to design appropriate educational/training programmes according to 
the needs of employees. 

Belgium – Fraud prevention strategy for agricultural and fisheries expenditure 

The 2017 strategy paper on fraud, which includes an anti-fraud policy statement, focuses on the 
specific fraud prevention strategy for expenditure from the EU agricultural and fisheries funds. 
Without  prejudice  to  the  measures  already  taken,  the  declaration  constitutes  a  formal 
commitment  to  the  EU  authorities,  regarding  the  preparation  of  a  structured  and  visible  anti-
fraud strategy.  

Regarding risk management, a number of topics selected for priority screening were analysed 
from the angle of vulnerability to fraud and fraud prevention. This methodology will be applied 
mutatis mutandis to a wider range of processes. 

The  strategy  to  prevent  and  tackle  fraud  is  further  strengthened  and  structured  thanks  to  the 
initiatives taken by the management board, underpinned by the two policy statements. 

33 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionAFCOSSingleAdministrativeAManagement of the fundsto enhance existing measuresSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionStrcutured commitment for preventing and combating fraud (other)PackageOperationalAIT tools, risk indicatorsEnhanced coordination, enhanced information flow, targeting checks, enhanced ex-ante controls, enhanced ex-post controlsS 
 
 
 
 
 
 
 
 
Romania – Package of measures on the control of EU funds 

At  managing  authorities  level,  operational  procedures/manuals  were  approved  for  preventing 
and combating irregularities/fraud, for carrying out verification activities and for classic on-the-
spot checks; The Audit Authority adopted the Audit Manual for European Structural Funds and 
Investments for the Programming Period 2014-2020. 

In order to prevent and combat irregularities/fraud in connection with obtaining/using European 
funds. 

Administrative  measure:  Fraud  risks  evaluation  procedures/managing  authority  action  plans 
(MA HCOP, MA COP, MA LIOP, MA ROP); Operational Procedure regarding the remedying 
of aspects that might affect the rights and legitimate interests of TAOP beneficiaries  - 2020 - 
MA  TAOP;  Irregularities  and  fraud  prevention  plan  -  AFIR  (Rural  Investment  Financing 
Agency)  Anti-fraud  action/control  plan  -  MA  ACOP;  Audit  Manual  for  European  Structural 
Funds  and  Investment,  2014  programming  period  -  Audit  Authority;  APIA  (Agency  for 
Payments and Intervention in Agriculture) procedures/manuals;  Manual on internal procedure 
for verification activities - MA FMAOP. 

1  Periodical evaluation of fraud risks, prevention and/or reduction of risk of irregularities and fraud 
occurring in the implementation of projects. 

² At Audit Authority level, training sessions were organised to disseminate and roll out the Audit 
Manual for European Structural Funds and Investment - programming period 2014 - 2020. At MA 
HCOP level, the Anti-Fraud and Irregularities Detection Service was reorganised. At MA FMAOP level, 
the Control Service for the Fisheries and Maritime Affairs Operational Programme was established. 

³ The training sessions organised in order to disseminate and roll out the Audit Manual for European 
Structural Funds and Investment - programming period 2014-2020 - updated the external public 
auditors’ knowledge of the requirements concerning protection of the European Union’s financial 
interests. 

4 At APIA level, control activities were ordered concerning the way beneficiaries obtain financial 
support managed by APIA. At MADR level, a sample was selected of projects contracted under the 
NRDP 2014-2020 which underwent verification in 2017. In the process for evaluating fraud risks and 

34 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionAdministrativeN/APreventing and combating irregularities/fraud (other)Other 1SDetectionOperationalAIT tools; increased number of checks; other 4Enhanced information flow; enhanced ex-post controlsSSShared management and control of EU fundsPackageOrganisationalAReorganisation of existing bodies; general trainings; fraud awareness trainings; other²other³ 
 
 
adopting efficient and proportionate anti-fraud measures, at MA COP level, a new version of the 
ARACHNE IT system - ARACHNE Risk scoring tool, Version 2.0 - was created in 2017. 

5.1.2  Agriculture, Fisheries, Cohesion, AMIF, FEAD and EGF 

Estonia – Access to the tax information 

On  01.04.2017  an  amendment  in  the  Estonian  national  Taxation  Act  §  29  “Disclosure  of 
information containing tax secrets” point 46 was adopted, which gave to the competent bodies 
the right to access different tax information. In particular, Estonian implementing agencies got 
the possibility to compare information and fight against fraud more effectively. 

This  measure  is  expected  in  facilitating  the  fraud  response  capabilities  of  implementing 
agencies, allowing them to detect fraud cases before payment or reducing the financial loss. 

The content of the legislative provision § 29: “A tax authority may disclose information subject 
to tax secrecy” point 46 “to the management authority of funds specified in § 1 of the 2007–
2013 Structural Assistance Act and § 1 of the 2014–2020 Structural Assistance Act and to the 
persons engaged in granting support on the basis of fund-specific rules to the extent which is 
necessary  for  the  checking  of  compliance  with  the  requirements  for  the  grant  of  support, 
purposeful use and eligibility of expenditure”7. 

Bulgaria – Training courses on irregularities in public procurement 

Twenty-four  training  courses  were  organised  by  the  Audit  of  EU  Funds  Executive  Agency, 
attended  by  755  representatives  of  the  Management  Authorities,  Certifying  Authorities,  the 
Supreme Administrative Court, the Central Coordinating Unit, the National Institute of Justice, 
the Bulgarian Prosecutor’s Office, ministries, agencies, municipal administration - beneficiaries 
and procuring entities under the Public Procurement Act.  

The following subjects were covered:  

 

 

Irregularities  in  public  procurement  leading  to  financial  corrections  and  irregularities 
and fraud indicators in public procurement 
the  Audit  Authorities'  experience  with  the  programmes  under  the  European  Structural 
and Investment Funds. 

7 https://www.riigiteataja.ee/en/eli/528122017001/consolide  

35 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReason for  measureHorizontal / sectoralPreventionDetectionShared management and control of EU fundsSingleLegislativeAPowersTo clarify or consolidate existing rules; to enhance anti-fraud capability (other)S 
 
 
 
 
 
                                                            
The  measure  in  question  contributes  to  the  increase  of  knowledge  among  beneficiaries  and 
procuring entities  under  the  Public Procurement  Act  about  infringements  and  irregularities  in 
respect  of  the  rules  for  public  procurement  and  about  the  guidelines  on  correcting  and 
preventing them in future; and it promotes cooperation and mutual assistance among national 
bodies to prevent and remedy any potential or existing conflict of interest in relation to ex ante 
and ex post checks of public procurement procedures. 

5.1.3  Cohesion policy, fisheries, AMIF, EGF, FEAD 

Latvia – Updating internal procedures 

This measure covers the following funds: ESI and Migration and Asylum. 

Measures  taken  by  the  Managing  Authorities  related  to  the  updating  internal  procedures, 
approving  management  procedure,  performing  risk  assesment  procedures,  elaborating 
irregularity procedures and arising awareness of people about possibility to report about fraud. 

All those measures increses the national institutions ability to fight with fraud and ensure the 
highest  protection  of  national  and  EU  budget.  Managing  authorities  are  working  on 
improvements of system continuously. 

To  follow  requirements  of  Latvia-Russia  CBC  programme  2014-2020  legal  framework  about 
anti-fraud  measures/irregularity  prevention/detection/reimbursement  and  to  constitute  part  of 
programme management and control systems. Documents were prepared as part of Interreg V-
A  Latvia-Lithuania  Cross  Border  Cooperation  Programme  2014-2020  Management  and 
Control  Systems  in  order  to    ensure  programme`s  proper  implementation  and  monitoring, 
meanwhile  describing  fraud  risks  and  their  mitigation  activities,  as  well  as  fraud  cases 
detection, reporting, etc. 

Work  table  for  FEAD  Managing  Authority,  Certififying  Authority,  Co-operation  Authority 
(intermediate  body)  for  risk  assesment  documentation.  Risk  register.  Action  plan  for  MA  un 
CA for decreasing risks. 

36 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionInvestigation and prosecutionRecovery and sanctionPublic procurement; conflict of interest; fraud definition; shared management and control of EU fundsSingleOrganisationalNInter-agency cooperation; general trainings; fraud awareness trainingsNeutral on resourcesS 
 
 
 
Cyprus – Simplification of procedures 

The administrative measure adopted aims at simplifying the procedures in relation to Structural 
and Investments Funds and for the Fund for the most deprived. 

With  the  adoption  of  simplified  cost  options  the  access  to  EU  funding  becomes  simpler  and 
red-tape  is  decreased  for  many  recipients  (beneficiaries)  and  managing  authorities:  less 
paperwork,  lower  risk  of  errors,  no  duplication  of  audits  and  controls.  At  the  same  time, 
transparency has increased, there is a focus on results rather than on supporting documents and 
there are additional safeguards against fraud. 

Greece – System for financial corrections and procedures for recovering unduly paid 
amounts 

Adoption  and  publication  (in  the  Government  Gazette)  of  the  Ministerial  Decision  on  the 
system  for  financial  corrections  and  procedures  for  recovering  unduly  or  unlawfully  paid 
amounts imposed by the Fiscal Control Committee (EDEL), with regard to amounts originating 
from the State budget and/or the EU budget for the implementation of co-financed programmes 
under the Investment for Growth and Jobs goal of the European Maritime and Fisheries Fund, 
the Fund for the Most Deprived and the Globalisation Fund. 

It  is  important  because  it  provides  for  a  system  of  financial  corrections  in  the  event  of 
irregularities resulting from an infringement of EU or national rules that has had or may have 
an adverse effect on the EU budget by charging it with unjustified expenditure. Consequently, 
this system helps to protect EU financial interests. 

The Ministerial Decision: 

37 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionPreventionPublic procurement; Corruption; Conflict of interest; Fraud definition; Whistleblower; shared management and control of EU fundsPackageAdministrativeN/AManagement of funds; Irregularities reporting; Recovery; Financial corrections (Other)To enhance existing measure; Cross-cutting measure, multi-agency measure/ measure with impact on various bodies; OtherSOrganisationalNCompetence; Simplification of proceduresSRecovery and sanctionOperationalNIT tools; risk indicatorsEnhanced ex-ante controlsSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionShared management and control of EU fundsSingleAdministrativeN Eligibility criteria; Management of funds; Monitoring/desk checks; On the spot checksTo clarify or consolidate existing rules; To enhance existing measureS 
 
 
 
 
a)  clarifies the meaning of irregularity and financial correction; 

b)  establishes the scope; 

c)  describes the procedures for approving and assessing the results of the audit; 

d)  determines the various types of financial correction; 

e)  refers to the financial correction decision and its content; 

f)  clarifies the financial impact of the financial correction decision; and 

g)  describes the method for recovering unduly or unlawfully paid amounts. 

Ministerial Decision No 286/2017, published in the Greek Government Gazette, Series II, No 
466 of 17 February 2017. 

Portugal – Management and control systems 

With their management and control systems, the PT 2020 managing authorities will define the 
pillars  of  their  anti-fraud  strategy  which  aims  to  ensure  that  effective  and  proportionate  anti-
fraud measures are adopted, taking into account the risks identified in its work and establishing 
its policy on fraud, and the procedures to be followed. 

It helps to deter fraudulent practices, to prevent and identify indications of fraud, and to correct 
and  report  situations  detected  to  the  competent  authorities.  it  includes  in  particular 
administrative, organisational and operational measures adopted by the MA of POISE and the 
OP supporting the most deprived [PO APMC] in 2017. 

38 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionRecovery and sanctionShared management and control of EU fundsSingleLegislativeNDefinition of a specific topic; Recovery; Financial penaltiesTo enforce the rules in line with developments in EU lawSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionCorruption; Conflict of interest; Whistle-blowers; Shared management and control of EU fundsPackageAdministrativeAReporting of suspected fraud; Anti-fraud or anti-corruption strategy and Integrity and Transparency Measures (Other)To enhance existing measureSOrganisationalNCompetence; Awareness-raising measures on ethics, behaviour and integrity (other)Other 1SOperationalAFlagging practice; Risk indicators; Other²Enhanced ex-ante controls; Enhanced ex-post controls; Other³S 
 
 
 
1 Measures were carried out on ‘Ethics, public management and prevention of corruption’, directed at managers 
and staff and provided by the Council for the Prevention of Corruption [Conselho de Prevenção da Corrupção]. 

²  Depending  on  the  results.  These  plans  aim  to  assess  management  risks,  in  particular  regarding  fraud  and 
corruption and also risks of unintentional errors or irregularities occurring in connection with implementation of 
the operational programmes. 

³ Given the new assumptions on operationalisation of the risk assessment exercises, the MAs adapted the risk 
assessment  tool  provided  by  the  EU  (which  is  limited  to  inherent  risks  of  fraud  in  operational  activities),  and 
extended  it  to  include  risks  and  monitoring  of  non-operational  activities  performed  by  each  unit  and 
management  risks  as  a  whole.  The  MA  of  POISE  and  POAPMC  outlined  a  global  action  plan  setting  out  49 
additional checks as well as the bodies responsible and dates for its implementation. 

5.2 

Agriculture  

Germany - Establishment of a Federal/State Working Group 

Germany established a Federal/State Working Group [Bund-Länder-Arbeitsgruppe] ‘Artificial 
creation  of  eligibility  criteria  in  the  context  of  EU  agricultural  policy  implementation  in 
Germany’. 

As  part  of  the  EU  Common  Agricultural  Policy  reform  the  European  Commission  has 
strengthened  the  arrangements  ensuring  the  protection  of  the  financial  interests  of  the  Union. 
Provisions  concerning  the  artificial  creation  of  eligibility  criteria  have  also  been  developed 
further  in  this  context.  The  paying  agencies  are  called  upon  to  implement  these  guidelines 
accordingly. 

Hungary – Mandatory training on fraud prevention 

Hungary organised mandatory training on fraud prevention for the ’Hungarian State Treasury’ 
paying agency employees and basic anti-fraud training for Government Office paying agency 
employees performing delegated tasks, as well as making the training materials available to all 
colleagues concerned. 

During the presentations, attention was drawn to the importance of vigilance in the fight against 
fraud.  Employees  are  able  to  familiarise  themselves  with  the  principle  guidance  criteria  and 
illustrative  cases.  Annual  refresher  training  sessions  will  use  more  recent  examples  to  assist 
with  the  detection  of  irregularities,  such  as  fraud,  falsification  of  documents  and  artificially 
meeting qualifying conditions. 

39 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionShared management and control of EU funds; antifraud or anticorruption strategySingleOperationalNRisk indicatorsEnhanced coordination; enhanced cooperation; targeting of checksS 
 
 
 
 
 
Slovakia – Enhanced protection of EU financial interests 

Slovakia  Act  no.  280/2017  Coll.  of  12  October  2017  on  granting  of  aid  and  subsidies  in 
agriculture and rural development emphasizes the protection of the EU's financial interests and 
regulates irregularities' reporting under EAGF and EAFRD. The act is effective as of 1 January 
2018. 

This  legislative  amendment  complements  the  competences  of  state  administration  bodies  in 
providing aid for agriculture and rural development, including the field of the protection of the 
EU's  financial  interests,  which  will  help  to  prevent  irregularities  and  unify  practices  of  state 
authorities in the area of the protection of the EU's financial interests. 

Netherlands –Checks on the basis of procurement rules 

The  Netherlands  reported  having  adopted  an  organisational  measure  regarding  checks  on  the 
basis of procurement rules and the evaluation of reasonableness of costs. 

The measure aims at dealing with conflict of interests. 

40 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionFraud prevention and detection in the paying agencies for the 2014-2020 programming period, limiting irregularities and fraud, types of fraud (other)PackageOrganisationalN/AFraud awareness trainingNeutral on resourcesSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralRecovery and sanctionShared management and control of EU fundsSingleLegislativeNCompetences; recovery; financial penaltiesTo enforce the rules in line with developments in EU lawS 
 
 
 
 
 
 
 
Austria - Improvement in the Irregularities Management System (IMS) notifications 

Austria  took  a  specific  measure  to  improve  the  timeliness  and  quality  of  the  reported 
information. The measure encompasses training and simplified procedures to achieve the goal. 

Hungary – Rural development antifraud strategy 

In Hungary, the managing authority for rural development programmes (‘the RD MA’) adopted 
the RD MA Anti-Fraud Strategy. It prepared the fraud risk-assessment tool for 2017.  

In  cooperation  with  the  intermediate  body,  the  RD  MA  is  able  to  establish  a  proactive, 
structured  and  targeted  approach  to  managing  fraud  risks  during  the  implementation  of  the 
operational programme, determine the necessary measures to reduce specific fraud risks using 
the strategy and ensure the monitoring of fraud risks and fraud prevention measures. 

41 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionConflict of interests; shared management and control of EU fundsSingleOrganisationalACompetenceNeutral on resourcesSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionShared management and control of EU fundsSingleOrganisationalAGeneral trainings; simplification of proceduresNeutral on resourcesSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionAntifraud or anticorruption strategySingleAdministrativeNEligibility criteria; investigation; irregularities reporting; penalty; recoveryTo clarify or consolidate existing rulesS 
 
 
 
 
 
 
 
 
 
Luxembourg - Guidance note for Premium managers to prevent fraud 

A  scam  was  discovered  in  2013  following  an  internal  administrative  audit.  Following  that 
incident,  the  Ministry  of  Agriculture  fundamentally reviewed  its  external  and internal  control 
system.  Several  measures/safeguards  were  taken  or  reinforced  since  then.  The  following 
procedure is one of them. 

Poland – Manual of procedures 

Poland reported about the preparation of a manual of procedures entitled 'Providing information 
on irregularities detected within the framework of EAGF mechanisms operated by the National 
Centre for Agricultural Assistance' (No KP-611-490-ARiMR/1/z). 

This instrument was introduced with a view to regulating the process of providing information 
on  irregularities  and  fraud  within  the  framework  of  EAGF  mechanisms  operated  by  the 
National Centre for Agricultural Assistance. 

Covering  three  of  the  fraud  stages  of  the  antifraud  cycle,  this  operational  measure  covers 
aspects  related  to  flagging  practices,  use  of  risk  indicators  and  cooperation  with  law 
enforcement. 

Lithuania - Methodology for the Detection of artificially created conditions 

In view of Article 60 of Regulation (EU) No. 1306/2013 of the European Parliament and of the 
Council  of  17  December  2013,  60  “Circumvention  Claus”,  in  2017  Methodology  for  the 
Detection of Artificially Created Conditions for Obtaining Support  was updated for ensuring 

42 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralSOrganisationalAGeneral trainings; training sessions with DG AGRIIncreased reasourcesSOperationalAFlagging practice; risk indicatorsEnhanced information flow; targeting of checksSDetectionPreventionShared management and control of EU fundsPackageAdministrativeNIrregularities reportingTo clarify or consolidate existing rules; to enhance existing measureAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionFraud definition; shared management and control of EU fundsSingleOperationalNFlagging practice; risk indicators; structured cooperation with law enforcementEnhanced coordination, cooperation, information flowS 
 
 
 
 
 
 
 
more  effective  fight  against  fraud.  With  a  view  to  strengthening  irregularity  prevention  and 
minimise  the  increased  number  of  errors,  a  special  analysis  was  carried  out  and  preventive 
actions were implemented in order to contribute to a more effective protection of the EU and 
national financial interests. 

The  Methodology  for  the  Detection  of  Artificially  Created  Conditions  for  Obtaining  Support 
sets out criteria for identifying applicants or beneficiaries who have created artificial conditions 
for obtaining support so as to prevent potential irregularities and fraud. 

Cyprus - Methodology for the Detection of artificially created conditions 

With the goal to enhance the understanding & awareness regarding red flags & indicators for 
irregularity and fraud risks in the entire lifecycle of an application, incl. controls, a workshop 
was organised concerning: . “Best practices for Paying Agencies for conformity with antifraud 
obligations as foreseen in the legal framework on the financing, management & monitoring of 
CAP (The European Commission’s perspective)”. 

Topics of focus concerned thecCreation of artificial funding conditions / conflicts of interests. 

Luxembourg – Definition of procedures following the detection of irregularities and fraud 

A  scam  was  discovered  in  2013  following  an  internal  administrative  audit.  Following  that 
incident,  the  Ministry  of  Agriculture  fundamentally reviewed  its  external  and internal  control 

43 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionLegislativeADefinition of a specific topic; prevention of irregularities and fraud (other)To clarify or consolidate existing rules; to remedy flaws; to enforce the rules in line with developments in EU law; OtherSDetection and prevention of artificialy created conditions for obtaining support (other)PackageAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionConflict of interests; shared management and control of EU fundsSingleOrganisationalACompetence; fraud awareness trainingsNeutral on resourcesS 
 
 
 
 
 
 
system. Several measures/safeguards were taken or reinforced since then. This procedure is one 
of them. 

5.3 

Cohesion policy and Fisheries  

5.3.1  Cohesion policy 

Germany –Risk assessment using the Commission self-assessment tool 

Germany  conducted  risk  assessments  using  the  self-evaluation  tool  developed  by  the 
Commission in line with Annex 1 to the Guidance Note on fraud risk assessment and effective 
and  proportionate  anti-fraud  measures,  a  request  was  made  to  all  legal  and  natural  persons 
involved  in  a  procurement  procedure  to  sign  a  statement  declaring  the  absence  of  conflict  of 
interest.  

The  fraud  self-assessment  instrument  proposed  by  the  Commission  is  a  simple,  logical  and 
practical tool based on five main methodical steps:  

1.  Quantifying the (gross) risk of the occurrence of a certain type of fraud,  
2.  Evaluation of the effectiveness of the existing controls,  
3.  Evaluation  of  the  net  risk  after  taking  into  account  the  effectiveness  of  all  existing 
controls and their effectiveness, i.e. assessment of the current situation (residual risk)  
4.  Evaluation of the effectiveness of the planned mitigating controls for the net (residual) 

risk  

5.  Determination of the target risk, i.e. the risk which is deemed tolerable by the managing 
authority  once  all  controls  have  been  put  in  place  and  their  effectiveness  has  been 
proven. 

44 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionShared management and control of EU fundsPackageAdministrativeNIrregularities reportingTo clarify or consolidate existing rules; To enhance existing measureSOrganisationalAGeneral trainings; training sessions with DG AGRIIncreased resourcesSOperationalAFlagging practice; risk indicatorsEnhanced information flow; targeting of checksS 
 
 
 
Ireland – Anti-fraud policy and statement 

Both  Managing  Authorities  for  ERDF  have  drawn  up  an  anti-fraud  policy  and  an  anti-fraud 
statement, together with procedures for adequate fraud risk assessment. A fraud risk assessment 
has taken place to identify the impact and likelihood of fraud risks relevant to the key processes 
in the programmes, The fraud risk assessment will be updated bi-annually. This is in line with 
the designation action plan. 

To asses the risk in respect EU co-funded measures. 

Croatia –Guidelines on irregularity management 

Guidelines on Irregularity Management in the context  of programmes supporting objectives of 
European territorial cooperation for the period 2014-2020 were drafted by SCIF and adopted by 
the  Minister  of  Finance  in  May  2017.  Also  SCIF  is  currently  in  the  process  of  drafting 
Guidelines on Irregularity Management in the context of  Fund for European Aid to the most 
Deprived (FEAD) within Operational programme for food and basic material assistance for the 
period  2014.-2020.,  Guidelines  on  Irregularity  Management  in  the  context  of  European 
Fisheries Fund for the period 2014.-2020. 

This measure is extremely important beacuse it ensures effective and efficient protection of the 
EU  financial  interests  by  improving  the  work  efficieny  of  the  competent  institutions  in  this 
area,  as  well  as  quality  of  reporting.Also,  together  with  the  abovementioned  SCIF  is  in  the 
process  of  drafting  Guidelines  on  Irregularity  Management  in  the  context  of  national 
programmes Asylum, Migration and integration Fund (AMIF) and International Security Fund 
for  the  period  2014.-2020.  and  Guidelines  on  Irregularity  Management  in  the  context  of 
common agricultural policy 2007.-2013. and 2014.-2020. 

45 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionPublic procurement; financial crime; corruption; conflict of interests; shared management and control of EU funds; otherSingleOperationalN/ARisk indicatorsTargeting of checks; other (Verifying and securing a tolerable level of risk; Overview of the existing risk areas, individual risks and controls)SAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionShared management and control of Eu funds; antifraud or anticorruption strategySingleAdministrativeN Eligibility criteria; Management of funds; Monitoring/desk checks; On the spot checks; Irregularities reportingTo clarify or consolidate existing rules; EU Regulatory requirement for designation purposes (other)S 
 
 
 
 
 
Lithuania – Seminars on corruption and fraud detection and conflict of interests 
management 

A  Managing  authority,  in  cooperation  with  the  Special  Investigation  Service  (anti-corruption 
agency)  and  Financial  Crime  Investigation  Service  under  the  Ministry  of  the  Interior,  has 
organised seminars for the institutions of the Managment and Control Sysytem in the field of 
detecting  possible  corruption  and  fraud  cases  and  in  the  field  of  management  of  conflict  of 
interests. 

Competence of the staff managing the projects financed by the EU funds and/or planning the 
investments of the EU funds was strengthened in the field of detecting possible corruption and 
fraud  cases  (e.g.  in  the  field  of  public  procurement,  research  and  development  projects  and 
other) and in the field of management of conflict of interests. The increased competence of the 
staff mitigates the risk of possible coruption or fraud, also information sharing chanels between 
MCS  institutions  and  investigative  bodies  have  been  discussed  and  agreed  (23/11/2017; 
17/10/2017, 24/10/2017, 5-6/12/2017). 

Luxembourg – Simplified cost options in ESF projects 

According to the Ministry of Labour, the managing authority of the ESF, the use of simplified 
cost  options  increases  transparency  with  regards  to  result  and  therefore  reduces  the  possible 
intention of fraud on behalf of beneficiaries. 

46 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionAFCOS; treatment and follow-up of irregularities (other)SingleAdministrativeAIrregularities reportingTo enhance existing measureSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionFinancial crime; corruption; conflict of interestSingleOrganisationalNFraud awareness trainingsNeutral on resourcesS 
 
 
 
 
 
Netherlands –2nd Risk assessment 

After  the  first  fraud  risk  assessment  for  ERDF  conducted  in  June  2015,  the  assessment  was 
again carried out on 10 October 2017 as per previous agreements. The findings of the second 
assessment have been discussed and a decision will be made in the near future on the follow-up 
action  to  be  taken. In  this  way,  risk  areas  will  be  identified  at  an  early  stage and appropriate 
measures devised. 

Austria – High density of verifications 

A  high  density  of  verificiations  pursuant  to  Article 125(4)  of  Regulation  No  1303/13  for  the 
2014  -  2020  programming  period  serves  to  prevent  irregularities.  The  verification  procedure 
provides for the managing authority to check all the expenditure submitted by the beneficiary. 

Formal  requirements  in  the  national  rules  on  eligibility  and  in  the  management  and  control 
system should increase efficiency. Standardised forms (check-lists) improve the quality of the 
accounts submitted. 

Presentation  of  the  entire  funding  operation,  including  the  accounting  process,  in  a  central 
database. In addition, the Arachne data-mining tool, provided by the Commission, is used for 
risk evaluation and risk analysis. 

47 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionPreventionOrganisationalNSimplification of proceduresNeutral on resourcesSOperationalAIT toolsEnhanced ex-ante controls; Enhanced ex-post controlsSFraud definitionPackageAdministrativeNEligibility criteria; monitoring/desk checks; on-the-spot checks; audit chcklistto reduce administrative burden and to focus on the outputs and results of the projects instead of limiting the checks of the application of accountability rulesSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionConflict of interests; shared management and control of EU fundsSingleOrganisationalACompetenceNeutral on resourcesS 
 
 
 
 
 
Poland – Cooperation agreement between Minister for Development and Finance and the 
Public Prosecutor 

A  cooperation  agreement  between  the  Minister  for  Development  and  Finance  and  the  Public 
Prosecutor  was  signed  on  the  communication  of  information  on  pending  and  concluded 
proceedings relating to projects implemented with European funding. 

This  instrument  enables  information  to  be  exchanged  on  proceedings  involving  projects 
implemented  with  EU  funds  on  a  cyclical  basis:  twice  in  each  year  of  the  Agreement  for  all 
proceedings and as part of ongoing cooperation should it be necessary to obtain information on 
specific proceedings through working contacts between designated employees of the Ministry 
and the Public Prosecutor. MA may also send questions on specific proceedings to the Public 
Prosecutor, the result of which may affect eligibility of expenditure. 

Furthermore, in this way, prevention and detection of fraud and irregularities will be enhanced, 
ensuring  that  grants  are  made  available  in  accordance  with  the  rules  and  implementing  grant 
agreements. 

Slovenia – Cooperation with law enforcement and judicial authority 

The  Slovenian  Government  Office  for  Development  and  European  Cohesion  Policy  (SVRK) 
finalised  a  package  of  agreements  to  strengthen  cooperation  with  investigative  bodies  and 
auhtorities: 

1.  with  the  State  Attorney’s  Office  of  the  Republic  of  Slovenia  on  education  at  judicial 
schools  –  organisation  of  workshop  on  ‘legal  framework  for  relationships  stemming 
from the granting of European cohesion policy funding’; 

2.  with  State  Attorney’s  Office  in  all  matters  relating  to  European  cohesion  policy 

reporting, and mutual assistance and support; 

48 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionRecovery and sanctionPublic procurement; conflict of interests, shared management and control of EU funds; antifraud or anticorruption strategyPackageAdministrativeAEligibility criteria; management of funds; on-the-spot checks; irregularities reporting; recoveryCross-cutting measure; multi-agency measure / measure with impact on various bodiesSOperationalAIT tools; otherEnhanced information flow; targeting of checksSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionShare management and control of EU funds; Antifraud or anti-corruption StrategySingleOperationalNFlagging practice; risk indicators; increased number of checks; structured cooperation with judicial authoritiesEnhanced coordination, cooperation and information flow; targeting of checks and investigations; prevention and detection of fraud and irregularities (other)S 
 
 
 
 
3.  with  Police  regarding  training  of  staff  at  IB,  MF-CA,  AA  and  MA  on  the  topic  of 

‘Fraud at the EU’s expense’. 

In 2017 the Slovenian Agency for Agricultural Markets and Rural Development (ARSKTRP) 
organised  training  for  staff  on  how  to  prevent  fraud  and  the  artificial  creation  of  conditions. 
ARSKTRP staff carried out the training at MKGP and KGZS. 

This package of measures aims at the following goals: 

  more  effective  and  improved  functioning  of  the  judicial  system  in  Slovenia;  easier 
recovery  of  undue  amounts  from  beneficiaries;  improved  understanding  of  the 
functioning of the European cohesion policy system. 
improved  drafting  of  judicial  documents,  more  efficient  recovery  of  unduly  spent 
European  cohesion  policy  funds,  improved  representation  of  the  interests  of  Slovenia 
and protection of the EU budget. 

 

  more efficient and effective detection and prevention of irregularities and fraud. 
  As  regards  ARSKTRP:  continuing  training  and  awareness-raising  of  staff  involved  in 
drafting  legal  frameworks,  providing  advice  and  conducting    administrative  decision-
making procedures, in order to prevent artificial creation of conditions. 

Slovakia – Enhancement of transparency of the evaluation procedure 

Enhancement  of  transparency  of  the  evaluation  procedure  of  the  Requests  for  Non-repayable 
Financial  Contribution  (hereinafter  as  „RNFC“)  by  means  of  publication  of  the  list  of 
evaluation  experts    and  evaluation  sheets  in  accordance  with  the  EC  applied  in  the  Horizon 
2020  work  programme,  demanding  increase  on  evaluation  experts  and  demonstrability  of 
competence  of  evaluation  experts,  electronic  draw 
lots  of  evaluators  on  website 
www.itms2014.sk, enhancement of cooperation with non-governmental organizations. 

Assurance  of  increased  transparency  by  publication  of  the  list  of  evaluation  experts  and 
evaluation  sheets  in  the  public  section  of  ITMS2014+,  increase  in  demands  on  evaluation 
experts,  demonstration  of  proficiency  in  the  area  of  the  evaluation,  elimination  of  conflict  of 
interest and automatic random sampling  of evaluation experts for RNFC  by ITMS2014+ will 
have due to reducing of potencial corruption, conflict of interests and increase of competency 
and  proficiency  the  significant  effect  on  enhancement  of  protection  of  the  EU´s  financial 
interests and contribution to the prevention of fraud. 

Prevention of the conflict of interests at the evaluation expert.  Increase of checks of EU funds. 
Enhancement of monitoring made by non-governmental organizations. 

49 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionRecovery and sanctionPackageSOrganisationalAGeneral trainings; fraud awaress trainingsNeutral on resourcesPublic procurement; conflict of interests, fraud definition; AFCOS; shared management and control of EU funds 
 
 
 
The legislation measure in the sense of Programming Declaration of the Government of the SR 
for years 2014–2020 by which was enhanced the principle of transparency,effectiveness,finality 
and  orientation  on  results  in  implementation  of  EU  funds.The  document  approved  by  the 
Government  Decision  No141  dated  13  April  2016  and  also  by  the  National  Council  of  the 
SR.Through  the  modification  of  the  Act  No  575/2001  Coll.  on  organization  of  government 
activities and organization of the central state administration was established the Deputy Prime 
Minister´s Office for Informatization and Infrastructure. 

The intents and responsibilities stated in the Programming Declaration of the Government are 
binding and periodically evaluated on the level of the state administration. 

Document  approved  by  the  Government  Decision  No141  dated  13  April  2016  and  by  the 
National Council of the Slovak republic as printing No 45 dated 18 April 2016. 

Finland - upgraded EURA 2014 Structural Funds management system 

With the new findings section of the EURA management system, the authorities implementing 
Finland’s  Structural  Funds  Programme,  including  the  intermediate  bodies  as  well  as  the 
managing, certifying and audit authorities, can observe all the findings recorded in the system 
and can each make use of it in their own work. Intermediate bodies can use it, for example, in 
project risk assessment in the project preparation stage. 

50 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionLegislativeACompetences; Definition of a specific topic; otherotherAdministrativeAManagement of funds; Increase of quality of the fund management by the Managing Authority aimed at extension of the possible access of the public to the control of the selection project procedureto enhance existing measure; enhance the transparency within selection of projectsOrganisationalNcompetence; enhancement of competency of the Managing Authority in the area of using of the IT meansNeutral on resourcesOperationalA IT tools (“IT data feeding”, “Other IT”); Web reporting/Hotline; Risk indicators; Other Enhanced information flow; Enhancement of information accesible to the public (other)Conflict of interest; shared management and control of EU funds; Prevention of the conflict of interests at the evaluation expert.  Increase of checks of EU funds. Enhancement of monitoring made by non-governmental organizations (Other)PackageSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionInvestigation and prosecutionRecovery and sanctionPublic procurement; Shared management and control of EU fundsSingleOperationalNIT toolsEnhanced information flowS 
 
 
 
 
 
United Kingdom - Implementation of a Counter Fraud Strategy for the 2014-20 ESIF 

The  United  Kingdom  Ministry  of  Housing,  Communities  and  Local  Government  adopted  an 
antifraud strategy for the 2014-20 European Structural and Investment Funds (ESIF) focusing 
on  fraud  risk  assessment,  management,  training  and  relevant  procedures,  also  adopting  and 
using  ARACHNE  to  identify  possible  fraud  through  validation  and  cross  referencing  of 
information/data. 

This strategy ensures the UK has systems, procedures and internal controls in place to prevent, 
detect and minimise fraud on European Funded projects. The introduction of the ARACHNE 
system  will  help  identifying  potential  fraud  through  validation  and  cross  referencing  of 
information/data.  The  system  will  help  to  identify  European Funded  projects  which  might  be 
susceptible to conflict of interest in addition to other risks relating to fraud and irregularities. 
The  introduction  of  the  ARACHNE  system  will  help  identifying  potential  fraud  through 
validation and cross referencing. 

United Kingdom - Segregation of European Social Fund (ESF) functions 

The  Managing  Authority,  the  Department  for  Work  and  Pensions,  is  structured  to  ensure 
segregation of ESF functions: the claims recording, verification, and authorisation are separated 
by individual function and teams e.g. The appraiser and approver of the application is different 
to contract manager; the person checking claims is different to the authoriser. This separation 
of  functions  has  been  incorporated  into  development  of  the  IT  system  preventing  users  from 
undertaking tasks on a project which conflict with one they have already done. 

Fraud  committed  by  staff  or  organisations  delivering  services  on  behalf  of  government  can 
create significant financial and reputational harm. 

Serving  as  a  primary  defence  against  internal  fraud,  these  measures  ensure  that  there  is 
oversight  and  review  to  catch  errors  and  helps  to  prevent  fraud  or  theft  because  it  involves 
separating  main  functions  and  having  them  conducted  by  different  employees  and  different 
teams, so it is much more likely that fraud will be detected or discouraged in the first place. 

51 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionpublic procurement; corruption; conflict of interest; fraud definition; whistleblower; antifraud or anticorruption strategyPackageAdministrativeN / AEligibility criteria; management of funds; monitoring/desk checks; on-the-spot checks; audit checklist; investigation; irregularities reporting; penalty; recoveryTo enhance existing measureSOrganisationalN / AReorganisation of existing bodies; competence; inter-agency cooperation; general trainings; fraud awareness trainings; simplification of proceduresNeutral on resourcesS 
 
 
 
 
 
5.3.2 

Fisheries 

Italy – fight against illegal fishing 

Italy  adopted  the  Ministerial  Decree  No  16591  of  25  July  2017,  which  defined  methods, 
deadlines and procedures for the application of the points system for serious infringements to 
masters  of  fishing  vessels,  within  the  meaning  of  Article  19  of  Legislative  Decree No  4  of  9 
January 2012. 

The  legislative  measures  introduces  more  appropriate  penalties  that  give  the  system  greater 
credibility by enhancing the preventive role played by penalties. 

Article  39  of  Law  No  154  of  28  July  2016  amended  the  penalty  system  relating  to  fishing, 
which meant that the content of Ministerial Decree 29/2/2012 - on the methods, deadlines and 
procedures  for  the  application  of  the  points  system  to  masters  of  fishing  vessels  for  serious 
infringements of the CFP  - had to be updated, in the light of the new types of administrative 
offence  established  as  a  result  of  the  decriminalisation  process  consisting  in  increasing  the 
amounts of the administrative fines laid down. 

Finland – Anti-fraud plan for EMFF 

Finland adopted an anti-fraud plan for the European Maritime and Fisheries Fund (EMFF). 

The purpose of the anti-fraud plan is to help the authorities prevent and identify deliberate and 
unintended irregularities and fraud and adopt the follow-up measures needed to combat them. 
The plan was drawn up in 2017 and implementation will start in 2018. 

52 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionConfict of interest; antifraud or anticorruption strategyPackageAdministrativeAEligibility criteria; management of funds; monitoring/desk checks; on-the-spot checks; audit checklist; investigation; irregularities reporting; penalty; recoveryTo enhance existing measureSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionRecovery and sanctionIllegal fishingSingleLegislativeNFinancial penaltiesTo clarify or consolidate existing rulesS 
 
 
 
5.4 

Measures  covering  several  shared  management 
management 

funds  and  centralised 

Spain – Establishment of a confidential channel 

These measure covers all expenditure sectors. 

Spain established a confidential channel for complaints centralised  at AFCOS, through which 
any  person  aware  of  facts  that  may  constitute  fraud  or  irregularities  in  relation  to  projects  or 
operations fully or partially funded by EU funds can report these to the administration so that 
the competent authorities can take the necessary measures to investigate or verify these facts, 
and, if applicable, require responsibility to be taken as appropriate in each case. 

This channel allows whistleblowers to report facts of which the authorities would not otherwise 
be aware. In addition, this channel is centralised at AFCOS and applies to any European Fund 
and to the state, regional and local level. It therefore guarantees technical and uniform handling 
of  complaints  and  efficient  use  of  resources,  since  the  managing  authorities  can  use  this 
channel without needing to create one of their own. AFCOS Communication 1/2017 regulates 
the main elements of this channel. 

Bulgaria – Roundtables on investigation of crimes connected to abuse of EU funds 

These measure covered all expenditure sectors. 

In  2017, two three-day roundtables  on the subject of ‘Protecting  the financial  interests  of the 
EU:  investigation  of  crimes  connected  to  abuse  of  EU  funds’  were  organised  by  the  AFCOS 
Directorate  at  the  Ministry  of  the  Interior.    The  participants included  80    investigative  police 
officers and operational staff from the 28 district directorates of the Ministry of the Interior, the 
National  Police  General  Directorate,  and  the  Fight  against  Organised  Crime  General 
Directorate,  as  well  as  representatives  of  3  Managing  Authorities,  the  Supreme  Cassation 
Prosecutor's Office, the Sofia Court of Appeal and the AFCOS Directorate. 

53 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralPreventionDetectionControl of Eu fundsSingleAdministrativeNManagement of funds; monitoring/desk checksTo clarify or consolidate existing rulesSAnti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionAFCOS; whistleblowerSingleOperationalNWebreporting/hotlineEnhanced coordination, cooperation and information flow; targeting of investigationsS 
 
 
 
The measure is important because it concerns specialised training and exchange of experience 
among staff of the specialised bodies, through the presentation and discussion of the European 
and national mechanisms for combating irregularities and fraud in the use of European Union 
funds,  through  sharing  of  good  practices  in  the  detection  and  investigation  of  crimes  and 
through solving specific case studies taken from jurisprudence. 

Hungary – Use of Europol European Secure Network 

These measure covers Cohesion policy and Centralised direct management 

Hungary adopted the Joint Directive No 23/2016 of 15 September 2016 of the Minister for the 
Interior and the Minister for the National Economy, issued pursuant to Sections 21(3) and (26) 
and  90(14) of  Government  Decree No  152/2014  of  6  June  2014  on  the  duties  and powers  of 
members of the government, based on the authorisation conferred under Section 23(4)(c) of Act 
CXXX of 2010 on legislation, in order to ensure the uniform and mandatory use of the Europol 
European Secure Network applications and compliance with the data protection regulations for 
handling open and classified data when using the system. 

Joint Directive No 23/2016 and Directive No 25/2017 of 17 August 2017 of the National Police 
Headquarters implementing Joint Directive No 23/2016 of 15 September 2016 of the Minister 
for the Interior and the Minister for the National Economy laying down rules for cooperation 
and  information  exchange  entailing  the  use  of  the  Europol  European  Secure  Network 
applications  are  intended  to  ensure  that,  if  the  same  crime  is  committed  by  the  same 
perpetrators in two or more EU Member States, relevant data representing the law enforcement 
interests of the investigative authorities are forwarded securely via digital channels (SIENA). 

The  directive  disciplines,  among  others,  the  forwarding  of  data  in  the  event  of  commercial, 
financial  or  corruption  offences  falling  within  the  investigative  authorities’  powers  and 
jurisdiction  in  criminal  proceedings  when  cooperating  with  other  national  (the  police,  the 
customs  and  finance  guard,  the  public  prosecutor's  office,  the  courts)  or  international 
investigative  authorities  or  joint  investigative  teams  (JITs)  or  providing  legal  assistance  in 
criminal matters (MLA). 

54 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionInvestigation and prosecutionPublic procurement; organised crime; AFCOS; shared management and control of EU fundsSingleOrganisationalNInter-agency cooperation; general trainings; fraud awareness trainingsNeutral on resourcesS 
 
 
6. 

ADDITIONAL MEASURES REPORTED BY MEMBER STATES 

6.1. 

Belgium 

6.1.1.  Federal Public Service - Finance (Anti-Fraud Cell) 2 additional measures: 

— Article 338, § 2, 11° and 16° to 20° of the Income Tax Code: Automatic exchange 
of  information:  the  transposition  into  national  legislation  of  Council  Directive  (EU) 
2015/2376 of 8 December 2015 amending Directive 2011/16/EU as regards mandatory 
automatic exchange of information in the field of taxation. The main aim of the Law 
of 20 July 2017 is to allow the automatic exchange of cross-border advance tax rulings 
and  cross-border  advance  pricing  arrangements  between  Belgium  and  the  other 
Member States of the European Union. 

— Article 333, 3rd paragraph of the Income Tax Code is being amended so that, if an 
investigation  is  carried  out  at  the  request  of  a  foreign  state,  the  investigation  period 
(only  in  respect  of  the  external  request)  is  automatically  extended  for  an  additional 
period of four years without prior notice. 

6.1.2.  ERDF Wallonia: 

—  Cross-cutting  measure.  Measures  to  prevent  the  risk  of  fraud  have  been 
recommended  to  all  functional  administrations  in  accordance  with  the  Commission 
note on fraud risk assessment and effective and proportionate anti-fraud measures. 

6.1.3.  Belgium's  Anti-fraud  Coordination  Service    (AFCOS/CAF)  and  Interdepartmental 

Committee for Coordinating the Fight against Economic Fraud (CICF): 

—  Law  conferring  upon  economic  inspection  staff  the  powers  necessary  to  provide 
assistance to OLAF during on-the-spot checks. The relevant provision is Article 24 of 
the  Law  of  18  April  2017  laying  down  various  provisions  relating  to  the  economy. 
This  provides  for  the  insertion  of  Article  XV.30/2  into  the  Belgian  Economic  Law 
Code,  conferring  upon  economic  inspection  staff  the  powers  laid  down  in  Title  1, 
Chapter 1 of Book XV of that Code when they provide assistance to OLAF inspectors. 

‘The  officials  appointed  by  the  Minister  are  empowered  to  provide  the  necessary 
assistance to inspectors of the European Commission in accordance with Article 9 of 
Regulation (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot 
checks and inspections carried out by the Commission in order to protect the European 
Communities’ financial interests against fraud and other irregularities. 

The staff referred to in paragraph 1 shall have the powers laid down in Title 1, Chapter 
1.’ 

55 

Anti-fraud cycle stepsArea coveredSingle / PackageType of MeasureNew / AmendmentScopeReasons for  measure / expected resultsHorizontal / sectoralDetectionInvestigation and prosecutionFinancial crime; organised crime; corruption; forwarding of data (other)SingleOperationalN/AIT tools; webreporting / hotline; structure cooperation with law enforcement and with judicial authoritiesEnhanced coordination, cooperation and informatoin flow; information exchangeS 
 
 
6.2. 

Bulgaria 

6.2.1.  Operational measure 

By  Order  R-181/18.09.2017,  a  second  version  of  the  Procedure  for  managing 
access  to  the  EU  fraud  and  irregularities  risk  scoring  system  ARACHNE  was 
approved,  which  allows  each  organisation  to  maintain  up  to  ten  Administrator 
and  Observer  profiles  in  the  system  as  well  as  an  unlimited  number  of  Expert 
profiles, depending on the job description.  

In 2017, the number of staff with access profiles to ARACHNE was more than 
double that in 2016. Under the measure, it is planned to expand the circle of staff 
from the bodies responsible for the implementation of the programmes financed 
by  ESIF  with  access  to  the  EU  fraud  risk  scoring  tool  ARACHNE;  training  in 
how to use the system is also planned. 

6.2.2.  Organisational measure 

A wide-ranging  cycle consisting of twenty-seven two-day  training courses  was 
organised,  with  the  participation  of  seventy-five  prosecutors  from  all  appellate 
districts.  Subjects  covered:  Review  of  the  types  of  criminal  offences  that  are 
often the object of the fight against crimes affecting the financial interests of the 
EU:  budgetary  misappropriations;  documentary  fraud,  crimes  of  office, 
embezzlement, bribes and trading in influence. The cycle was a key part of the 
2017 training calendar of the Bulgarian Prosecutor’s Office and was based on a 
multidisciplinary  approach,  with  the  participation  of  academics,  prosecutors, 
representatives of the Public Financial Inspectorate Agency and the Audit of EU 
Funds Executive Agency. 

6.3. 

Croatia 

On the TAIB sectoral committee in the Republic of Croatia held in 2017, one of the 
recommendations was to educate Managment and Control System bodies in the filed 
of integrity and ethics. Following that, Service for combating irregularities and fraud 
organized  5  workshops  entitled  „Strengthening  the  integrity  of  civil  servants“  in 
cooperation  with  Ministry  of  administration  and  Public  school  for  public 
administration.  This  will  be  one  of  the  topics  that  will  be  repeated  in  the  upcoming 
period. 

With  the  aim  of  enhancing  administrative  capacities  and  improving  the  work 
efficiency of the competent institutions in the area of protection of the EU finanacial 
interests  Service  for  combating  irregualarities  and  fraud  drafted  a  project  proposal 
under  the  HERCULE  III  programme  for  the  exchange  of  experience  and  good 
practices  in  the  area  of  prevention,  detection,  treatment,  reporting  and  follow-up  on 
established  irregularities  and  suspicion  on  fraud  with  the  aim  of  protecting  the 
financial  interests  of  the  European  Union.  In  the  December  2017  we  have  been 
informed that our project entitled „Further strengthening of the competent institutions 
in the area of managing on irregularities with the aim of protection of the EU financial 
interests“  was  approved  by  the  European  Commission  and  therefore  eligible  for 
funding. 

56 

 
 
Partners  in  this  project  are  Spain,  Bulgaria,  Malta,  Romaina,  Estonia,  Netherlands, 
Serbia, Bosnia and Hercegovina and Montenegro and implementation of the project is 
forseen in the period 07.- 11.May 2018. 

6.4. 

Slovenia 

As an addition to Measure 3: 

1. Additional measures carried out at MF-Management Department/CA: Establishment 
of a debtors’ ledger in the computerised accounting system of the certifying authority 
(e-CA). In order to coordinate the combating of fraud and the control of EU funds (as 
indicated in the three measures set out above). MF-CA is responsible for keeping the 
records of amounts recoverable and amounts withdrawn following cancellation of all 
or  part  of  the  contribution  for  an  operation  (Article  61  of  Regulation  (EU)  No 
1303/2013). MF-CA keeps  a debtors’  ledger  for an individual operation  in  the e-CA 
computerised accounting system. When the beneficiary is responsible for recovery, the 
intermediate body’s claim against the beneficiary is entered in the debtors’ ledger. The 
debtors’ ledger also includes claims related to systemic corrections. 

Implementation in 2017, horizontal measure. 

2. MF-CA-Department for Management of EU Funds/CA: Updating of instructions for 
recovery of designated EU funds for the 2014-2020 programming period; (version of 
2/2017). Single and operational measure. The instructions set out the steps to be taken 
and  define  the  procedures  for  recovering  designated  EU  funds  where  undue  use  of 
such  funds  is  detected.  They  apply  to  all  participants  involved  in  implementing  the 
operational programme for European cohesion policy for 2014-2020 for Objective 1, 
and mutatis mutandis also to the operational programme for material assistance to the 
most  deprived  persons  for  the  period  2014-2020.  Expected  results:  Enhanced 
coordination and cooperation and more effective ex-post controls; 

3.  Updating  of  the  guidelines  of  the  certifying  authority  for  the  implementation  of 
European cohesion policy (version of 2/2017). 

6.5. 

United Kingdom 

In the Welsh Managing Authority we have taken several steps to strengthen anti-fraud 
measures  in  the  Welsh  European  Funding  Office.  Apart  from  formally  adopting 
ARACHNE a couple of years ago we have developed fairly detailed desk instructions 
for its use and implemented them into our policy and guidance. 

In  addition  to  this,  we  require  our  two  intermediary  bodies  to  do  likewise  and  have 
arranged  for  ARACHNE  to  be  made  available  to  them  and  will  be  testing  claims 
submitted to ensure they too are using it. 

The  Welsh  Government  has  also  signed  up  to  Cifas,  one  of  the  UK's  largest  cross-
sector  fraud  sharing  database,  and  this  is  being  rolled  out  across  the  whole 
organisation including the Welsh European Funding Office. 

Finally, having identified some potential issues in one of our priority areas, operations 
in  the  marine  energy  areas  we  are  currently  developing  strengthened  due  diligence 
measures. 

57 

 
 
7. 

TRAINING  ON  THE  IRREGULARITY  MANAGEMENT  SYSTEM  ORGANISED  BY  THE 
MEMBER STATES 

The Irregularity Management System (IMS) has more than 3,000 users across the 28 
Member  States  and  (potential)  candidate  countries.  In  order  to  organise  an  adequate 
support to users, the Commission (OLAF) has put in place a system which is based on 
the "train the trainers" approach. 

Based  on  this  "decentralised"  model,  47  training  sessions  were  organised  in  twelve 
Member States, attended by 607 trainees, as showed in Figure 8. 

Figure 8: Training sessions organised by Member States in 2017 

Member State 

Sessions 

Trainees 

BG 

DE 

DK 

EE 

ES 

HR 

HU 

IT 

LV 

NL 

PL 

SI 

TOTAL 

4 

12 

1 

1 

2 

3 

11 

4 

3 

2 

3 

1 

47 

42 

171 

4 

4 

60 

60 

42 

83 

3 

8 

120 

10 

607 

8. 

CASE STUDIES REPORTED BY MEMBER STATES 

8.1. 

Bulgaria 

European Social Fund--abuse of funds intended for upskilling staff 

The  Bulgarian  Prosecutor’s  Office  carried  out  an  investigation  of  an  offence  under 
Article  248a(3)(1)  in  conjunction  with  (2)(1)  of  the  Criminal  Code  concerning  false 
information  submitted  in  a  final  financial  and  technical  report  and  a  final  payment 
request for a project financed by the European Social Fund. The grant contract was in 
the amount of close to BGN 300 000. As per the contract terms, the beneficiary was 
supposed  to  implement  the  project  together  with  a  partner  from  Spain;  it  was 
specifically claimed  in the Final technical and financial report for the project that joint 
events had been held with a Spanish company both in Bulgaria and in Spain. 

In  order  to  verify  the  information  submitted  to  the  Contracting  Authority,  the  Sofia 
Prosecutor’s Office, via AFCOS, sent a request to OLAF for assistance in performing 
checks  in  Spain.  Following  the  checks  in  Spain,  the  final  OLAF  report  under  the 
investigation submitted to the Sofia Prosecutor’s Office contained documents, samples 
of  signatures  and  information  from  checks  and  questionings  relating  to  the  subject-
matter of the case. The materials submitted proved beyond doubt that the information 

58 

 
 
sent to the Contracting Authority was indeed false and that the Bulgarian beneficiary 
had not held joint events in Bulgaria and Spain with the Spanish company. 

The proceedings ended on 10 February 2017 with a settlement concluded between the 
manager  of  the  Bulgarian  legal  entity  and  a  representative  of  the  Bulgarian 
Prosecutor’s Office and approved by the Bulgarian court. The accused pleaded guilty 
of the offence. The manager of the Bulgarian legal entity was sentenced to a two-year 
prison term, suspended for 4 years on the basis of Article 66 of the Criminal Code, and 
fined BGN 5 000. 

8.2. 

Belgium 

The fraud was perpetrated in  the European market for carbon dioxide emissions,  the 
Emissions Trading Scheme (ETS). In operation since 2005, the scheme involves some 
11 000 undertakings in the 27 Member States. 

Each  undertaking  is  allocated  a  quota  of  emissions  allowances.  If  an  undertaking 
exhausts its emissions quota, it must buy ‘emissions credits’ from another undertaking 
which  has  not  used  up  its  emissions  quota  and  so  has  a  surplus  to  sell  on  the  ETS 
market,  which  takes  various  forms:  spot  market,  futures  or  OTC  transactions.  The 
majority of undertakings use intermediaries. 

The main trading hub is the Bluenext carbon exchange which handles almost 90 % of 
transactions (approximately EUR 10 billion in 2008), and most of the fraud took place 
on the Bluenext spot market. 

The fraudsters took advantage of the fact that VAT was levied on CO2 transactions in 
all EU countries except the UK. They bought their tonnes of CO2 in the UK and then 
sold them on in countries levying VAT. However, instead of paying the VAT back to 
the state concerned, they kept it for themselves. 

By carrying out a series of these operations in different places and between the on-the-
spot  and  OTC  markets,  the  fraudsters  were  able  to  build  up  a  substantial  amount  of 
non-reimbursed  VAT.  This  technique  was  particularly  easy  to  transfer  to  the  carbon 
market  since  the  tonnes  of  CO2  at  stake  are  ‘invisible  assets  which  are  difficult  to 
trace’. 

The transactions are visible only on paper. 

The  fraud  was  detected  in  2009  on  Bluenext.  The  FR  administration  was  quick  to 
adopt a provision to scrap VAT on emissions allowances while NL opted to have the 
buyer reimburse the VAT to the state. However these decisions designed to clean up 
the market are in breach of the EU VAT Directive in force since 2007. The EU is due 
to  announce  proposals  for  amending  the  Directive  to  tackle  the  fraud  problem  in 
September, while restoring the unity of tax rules across the Union. 

The  fraud  revelations  have  undermined  the  image  of  an  emissions  market  already 
misunderstood by the public. 

‘Law-abiding  operators  deplore  the  negative  impact  of  all  of  this,’  says  Emmanuel 
Fages, analyst at Orbeo, a subsidiary of Société Générale. ‘We are constantly trying to 
demystify the market. It is actually a normal commodity market. What happened can 
be put down to teething problems.’ 

59 

 
 
The  bad  publicity  generated  by  the  fraud  uncovered  in  Europe  could  also  have  a 
negative impact on the discussions to establish a similar market in the US. 

8.3. 

Greece 

Check  on  the  reasonableness  of  costs/identification  of  artificial,  non-competitive 
tender  prices  via  databases/reference  prices,  cross-checking  tenders  by  any  available 
means: 

Study  on  the  creation  of  a  database  of  reasonable  costs  of  equipment  and  building 
infrastructure for the investment measures of the 2014-2020 Greek Rural Development 
Programme.  The  first  deliverable  (D1),  entitled  ‘Methodology  for  the  analysis  and 
processing of cost data’ was submitted on 15 September 2017 and is a study on the use 
of cost data and methods for assessing the reasonableness of costs of machinery and 
building infrastructure. 

The intermediate database (D2) was delivered in December 2017 and may be used on 
a  pilot  basis  to  verify  the  reasonableness  of  costs  for  the  Programme’s  investment 
operations for the period up to submission of the final database in April 2018. 

The  database  of  reasonable  costs  of  equipment  and  building  infrastructure  for  the 
investment  measures  of  the  2014-2020  Greek  Rural  Development  Programme  will 
help to strengthen the procedures to verify the reasonableness of costs of investment 
operations at the assessment and control stages, and consequently mitigate the risk of 
cost overruns for the projects under the investment measures. 

8.4. 

Finland 

On  23  February  2017  Finnish  Customs  seized  a  consignment  of  690  kilos  of  water-
pipe  tobacco  that  had  arrived  from  the  United  Arab  Emirates.  The  consignment  had 
been  placed  under  the  customs  transit  procedure  and  the  contents  declared  as  hand-
washing powder destined for Latvia. However, the consignment of goods placed under 
the customs procedure did not go to Latvia. Instead, an attempt was made to send it to 
Germany,  as  a  duty-free  shipment  by  a  carrier  operating  in  Vantaa.  A  decision  was 
taken to check the consignment, at which point the boxes were found to contain one-
kilo plastic bags full of water-pipe tobacco. 

Customs suspect that water-pipe tobacco had been smuggled in the same way on five 
other occasions since December 2016. All of the consignments had been sent from the 
United  Arab  Emirates  and  all  were  declared  as  containing  hand-washing  powder 
destined for Latvia. All of the consignments were collected by the same Latvian man, 
who loaded the packages containing the water-pipe tobacco into his van and took them 
to a carrier operating in Vantaa for onward transport to France, where the consignees 
were private individuals. The man then drove the empty van back to Latvia, where he 
loaded the vehicle with the cheapest possible washing powder which he then cleared 
through  Latvian  customs.  It  became  clear  in  the  preliminary  investigation  that  there 
was  a  Russian  man  behind  the  operation  who  had  also  employed  the  Latvian  to 
smuggle  the  consignments  of  water-pipe  tobacco.  A  European  arrest  warrant  was 
issued for the Russian, which led to his arrest in Croatia and his transfer to Finland. 

The  investigation  found  that  a  total  of  3  080  kilos  of  water-pipe  tobacco  had  been 
smuggled  on  six  separate  occasions  and  the  tax  and  import  duties  evaded  on  these 
consignments amounted to over EUR 1 143 000. Customs’ share of the payments was 

60 

 
 
EUR 221 464 and VAT accounted for EUR 278 554. Excise duty accounted for EUR 
643 500 of the taxes evaded. This was regarded as a serious case of tax fraud. Vantaa 
District  Court  handed  down  a  judgment  in  the  case  on  8  December  2017.  Both  men 
were  sentenced  for  all  six  consignments.  The  Russian,  as  the  main  perpetrator, 
received  a  3-year  sentence  and  the  Latvian  courier  was  sentenced  to  2  years.  They 
were  also  ordered  to  pay  damages  of  over  EUR  885  000  for  the  consignments  of 
water-pipe tobacco that were not seized. 

8.5. 

Croatia 

Fund- Criminal act committed 

European Agricultural Guarantee Fund (EAGF, 2014-2020) 

Falsified/incorrect accounts 

Modus operandi 

Paying  Agency  on  11  January  2017  received  a  letter  from  the  Managing  Authority 
through which it was informed of the irregularity identified in the beekeeping sector in 
the case of the applicant requests. 

The applicant applied for subsidies in 2014 and received the requested amount paid by 
the  Paying  Agency  on  the  basis  of  measure  “Suppression  of  Vaginal  Abduction” 
(Annex  XII)  in  accordance  with  the  Ordinance  on  the  Conditions  and  Methods  for 
Implementation of Special Aid Measures for the Beekeeping Sector in 2014 under the 
National Beekeeping Program for the period 2014-2014. 

Managing  Authority  performed  inspection  by  the  implementation  of  subsequent 
controls of large beneficiaries of the aid in the beekeeping sector in order to determine 
whether the transactions constituting part of the system of financing by the European 
Agricultural Guarantee Fund were actually carried out and whether they were carried 
out correctly. 

In addition to the applicant some other legal entities were also under the control and 
with  the  control  of  the  trade  records  and  the  tax  administration's  findings,  an 
irregularity was found in relation to the total amount of aid requested by the applicant 
because  the  claimant  after  the  payment  made  the  account  overlap  and  in  this  way 
gained support on the amount with VAT included. 

However provision of Article 8 paragraph 2 of the Ordinance stipulates that the unitary 
amount of aid implies the monetary value of the veterinary medicinal product without 
VAT required for one single-bee vascular treatment. 

Actions initiated 

Due to the established suspicions of the illegal use of funds, the Managing Authority 
informs the competent institutions  - the Ministry of Finance and the State Attorney's 
Office of the Republic of Croatia, pursuant to Article 258, paragraph 1 of the Criminal 
Code. 

Furthermore,  as  regards  irregularities  related  to  the  issuance  of  trade  documents 
(invoices and approvals for transferred rebates and VAT) by controlled legal entities, 
pursuant to Article 169 of the Agriculture Act, it is given the instructions that it should 
be notified to the competent Ministry of Finance, Independent Tax Fraud Disclosure 

61 

 
 
(Tax  USKOK),  ie Tax Administration, and the Inspection Service of the Ministry of 
the Interior. 

8.6. 

Hungary 

EAFRD - Attempt to use falsified supporting document 

Under  Government  Decree  No 272/2014  of  5 November  2014,  when  submitting  an 
advance payment request for support from EAFRD funds the beneficiary must provide 
collateral equal to the amount of the advance payment. Prior to the advance payment 
request,  the  beneficiary  attempted  to  prove  by  means  of  a  bank  guarantee  that  the 
amount  serving  as  collateral  for  the  advance  payment  requested  was  available.  The 
Rural Development Programme paying agency contacted the credit institution that had 
issued  the  bank  guarantee  to  check  the  bank  guarantee’s  authenticity.  The  credit 
institution replied that it had not issued a bank guarantee with the reference number in 
question. After receiving this reply, the paying agency took the necessary measures by 
informing the competent investigative authorities and reporting the suspected fraud to 
the RD MA. As a result of this report, the RD MA cancelled the grant document and 
no advance payment was made. 

8.7. 

Italy 

Traditional  Own  Resources  –  Activities  to  combat  the  smuggling  of  foreign 
manufactured tobacco products 

The Economic and Financial Police Units of the Napoli Guardia di Finanza (Finance 
Police), as part of efforts made to prevent and combat cigarette smuggling, conducted 
a  complex  investigation  that  led  to  the  seizure  of  nine  tonnes  of  ‘cheap  white’ 
cigarettes destined for the port of Misurata, Libya. 

The significance of this result, as well as the large quantity of manufactured tobacco 
seized,  is  connected  with  the  particular  criminal  method  the  fraudsters  used  in  an 
attempt to circumvent the anti-smuggling network implemented at national and intra-
EU level. 

Specifically, taking advantage of the possibility of transporting foreign manufactured 
tobacco  intended  for  export  to  EU  countries  within  the  EU  under  deferred  tax 
arrangements, the criminal organisation planned a fictitious shipment of goods arriving 
from  Romania  on  a  container  which  was  to  be  loaded  at  the  port  of  Salerno  before 
sailing on to the port of Misurata. 

This method of transportation would have meant that, if any checks had been carried 
out  in  Italy,  the  shipment  of  foreign-manufactured  tobacco  would  not  have  been 
considered  smuggled  and  thus  subject  to  seizure,  since  it  was  officially  intended  for 
the non-EU market and not the national market. 

In fact, by using an aircraft to follow the road route taken by the suspect container, the 
police  team  found  that  the  fraudsters  had  used  a  second,  ‘dummy’  container,  of  the 
same shape and colour and affixed with fake labels displaying the same serial number 
as the container coming from Romania. 

The  ‘dummy’  container,  loaded  with  fake  ‘goods’  such  as  empty  boxes  and  bricks, 
would  therefore  have  been  the  one  which  would  have  actually  reached  Misurata, 
allowing  the fraudsters to release for consumption in  Italy the  manufactured tobacco 

62 

 
 
coming  from  Romania  on  board  the  original  container.  The  investigation  thus  led  to 
the arrest of the two fraudsters and the seizure of nine tonnes of cigarettes, intended to 
be sorted and transferred to secret warehouses. 

8.8. 

Lithuania 

On  17  November  2017,  Financial  Crime  Investigation  Service  opened  a  pre-trial 
investigation  concerning  fraud,  forgery  of  documents  and  fraudulent  management  of 
accounting. 

The investigation proceedings were initiated having conducted the analysis of project 
No. 3VK-KP-10-2- 

003762 “Development of Peat Extraction by UAB Agrodurpės” implemented by UAB 
Agrodurpės  and  having  identified  that  the  application  was  submitted  to  the  National 
Paying  Agency  under  the  Ministry  of  Agriculture  (further  –  Agency)  within  the 
framework  of  the  Measure  “Support  to  Business  Creation  and  Development”  of  the 
Rural Development Programme for Lithuania 2014–2020 even though the project did 
not  represent  agricultural  activity,  provision  of  agricultural  services,  crafts  or 
establishment  of  crafts  centres.  Total  project  value  is  EUR  622.581,09  out  of  which 
EUR 404.678 represents the EU support. 

In the course of the project implementation, UAB Agrodurpės declared to the Agency 
the purchase of different machinery for peat exploitation from UAB Specagra. It was 
established, however, that UAB Agrodupės was set up by use of the third parties and 
its financial activities were coordinated by the director of UAB Specagra because the 
latter company failed to comply with the requirements set up for beneficiaries in the 
afore-mentioned programme, which prevented it from applying for the EU support. In 
order to obtain the EU support by fraud, in the run of the project implementation fake 
public procurements were organised with the award of contracts to UAB Specagra as 
well  as  Specagra  OU  and  UAB  Agroteka  managed  by  the  same  shareholder  who 
artificially increased the prices of the machinery. The investigation also identified that 
in  the  mentioned  transactions  the  managers  of  UAB  Agrodurpės  and  UAB  Specagra 
engaged in secret agreements regarding the acquisition of extra machinery that was not 
foreseen in the project documentation. 

To  mislead  the  Agency  and  disguise  the  extra  machinery  illegally  included  in  the 
project  documentation,  the  managers  of  the  above-mentioned  companies  forged  the 
purchase  documents  and  submitted  them  to  the  Agency  for  the  compensation  of  the 
expences.  Then  in  order  to  conceal  the  committed  offences,  the  managers  of  UAB 
Agrodurpės  at  the  time  of  on-site  inspections  concealed  from  the  Agency  staff  the 
illegally purchased machinery by not registering and including it in its  accounting in 
accordance with the procedure established by the Agency. 

The  investigation  revealed  that  the  managers  of  UAB  Agrodurpės  in  collaboration 
with  the  director  of  UAB  Specagra,  seeking  to  acquire  high  value  property  by  fraud 
(EUR 404.678 of the EU support and national budget funds), set up the company for 
committing  criminal  acts  and  together  with  the  director  of  Specagra  OU  (Estonia) 
submitted to the Agency forged documents. 

63 

 
 
8.9. 

Latvia 

EU  structural  funds,  ERDF-  increasing  the  price  of  the  machinery  in  fraudulent 
manner. 

State  Police  of  Latvia  in  year  2013  started  criminal  procedure  against  company’s  X 
officials for possible fraudulent activities with purpose to defraud EU fund money in 
big amount. 

In  public  procurement  procedure  won  company  A,  which  was  supposed  to  deliver 
machinery. In 29 August 2006, Company A informed the beneficiary that they could 
not deliver one position of the machinery. 

Decision  was  made  that  the  second  participant  in  public  procurement  procedure 
company Y will deliver that position of the machinery. 

From  the  materials  of  the  case  can  see  that  company’s  Y  chairman  A.B.  personally 
knew  the  company’s  X  official  K.M.  In  addition,  company  Y  didn’t  deal  with  trade 
and delivery of that kind of machinery.  

During  the  investigation  investigators  found  out  that  company  X  transferred  the 
purchase  price  to  Company  Y  approximately  607  313,00  EUR.  In  2006  and  2007 
company  Y  transferred  approximately  617  400,00  EUR  to  company  Z  which  was 
closed up in 2013 and the chairman of the company V.D. from the 2013 doesn’t have a 
declared place of residence and has several convictions. 

Investigators has suspicions that officials of companies X, Y and Z had an agreement 
to  increase  the  price  of  machinery  and  in  the  end  price  which  was  paid  for  the 
machinery came back to company Y using the carousel transfers involving companies 
Y and Z. 

Request  for  legal  aid  was  sent  to  Bosnia  and  Herzegovina  and  investigators  got  the 
information  that  the  machinery  was  bought  there  for  200  000,00  EUR  and  that  the 
condition  of  the  machinery-  used.  From  the  documentation,  which  investigators  got, 
they  saw  that  company  X  official  K.M.  agreed  with  seller  about  buying  concrete 
machinery, which proves that company X official was aware about the real price and 
condition of the machinery. 

Thus,  the  K.M.  as  a  representative  of  beneficiary  mislead  the  Latvian  intermediate 
body-  LIAA  about  the  real  price  and  condition  of  the  machinery  and  received  EU 
funded  money  for  that  concrete  machinery  in  fraudulent  manner.  And  companies  Y 
and Z was involved in this scheme with purpose to increase the price of machinery. In 
this scheme K.M caused damage to LIAA in amount of 325 969, 15 EUR. 

In 2017, K.M. was declared as a suspect in criminal procedure. 

In July of 2017 this case was sent to Prosecutors Office. 

8.10.  Netherlands 

Preventing  the  double  declaration  of  costs  for  a  participant  involved  in  different 
projects. The check is carried out by comparing BSN numbers.  No fraudulent activity 
in 2017 was revealed by the check. 

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8.11.  Romania 

Cohesion  policy,  EAFRD  -  Violation  of  the  public  procurement  rules  for  private 
beneficiaries  established  by  AFIR  in  connection  with  the  construction  of  boarding 
houses;  

LP,  the  owner  of  X  SRL  (construction  company)  persuaded  his  wife  and  two 
daughters to set  up the companies X1, X2, X3 SRL in  order to obtain grants  for the 
construction of tourist boarding houses in a rural area. The AFIR rules stipulated that 
contracts for works and the supply of goods had to be concluded by beneficiaries who 
were  to  have  no  interest  in  the  supplying  companies  at  the  time  of  concluding  the 
contracts  (they  should  not  be  in  a  situation  giving  rise  to  a  conflict  of  interest).  The 
beneficiaries accordingly submitted a declaration of honour, rendering them liable to 
sanctions in the event of false declaration. 

The  beneficiaries  X1,  X2  and  X3  concluded  works  and  supply  contracts  with  the 
companies GA, GD and LA SRL, the links between these companies and LP’s family 
being as follows: 

GA was a beneficiary of European funds for the construction of a boarding house, and 
X was the builder; 

GD was owned by the husband of one of LP’s daughters; 

LA  was  owned  by  a  close  associate  of  LP,  a  beneficiary  of  European  funds  for  the 
construction of a boarding house, and X was the builder; 

None  of  the  companies  GA,  GD  or  LA  had  any  experience  in  construction  or  the 
supply of goods. 

What is more, GA and GD (builders) took on staff from X SRL in order to build the 
boarding houses. 

X1, X2 and X3 and the suppliers GA, GD and LA on the one side and X on the other 
used a fraud scheme to certify that payments were made under the projects, in order to 
justify the grants. 

Thus,  X1-X3  borrowed  money  from  X  to  pay  GA,  GD  and  LA  (builders  and 
suppliers),  and  they  immediately  transferred  the  money  received  to  X,  on  the  same 
day, by means of successive transactions. There was thus an understanding between all 
of these companies that the real contractor for the works and the real supplier of the 
goods was X. The declarations made by the beneficiaries to the effect that they did not 
find  themselves  in  situations  constituting  a  conflict  of  interests  were  therefore 
fraudulent  documents  submitted  to  AFIR  for  the  purpose  of  obtaining  grants  for  the 
three projects concerned. 

65