The OLAF report 2018 : nineteenth report of the European Anti-Fraud Office, 1 January to 31 December 2018.
Date: 2019-08-26
Institutions: European Anti-Fraud Office
Subjects: European Anti-fraud Office, activity report, fraud

ISSN 2315-2494

The OLAF  
report 2018

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ISSN 1977-4834  doi:10.2784/606883  OB-AD-19-001-EN-C

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The OLAF  
report 2018

Nineteenth report of the  
European Anti-Fraud Office,  
1 January to 31 December 2018

DISCLAIMER:

OLAF’s report features case studies for illustrative 
purposes only. The fact that OLAF presents such case 
studies does not prejudice the outcome of any judicial 
proceedings, nor does it imply that any particular 
individuals are guilty of any wrongdoing.

The European Anti-Fraud Office is 
commonly known as OLAF, which is the 
acronym of its title in French, Office 
européen de lutte antifraude.

Communicating with OLAF

http://olaf.europa.eu

Reporting fraud to OLAF 
http://ec.europa.eu/anti-fraud/olaf-and-you/
report-fraud_en

Complaining about an OLAF investigation 
http://ec.europa.eu/anti-fraud/olaf-and-you/
complaints-olaf-investigations_en

Requesting information on OLAF 
http://ec.europa.eu/anti-fraud/contacts/
general-enquiries_en

Visiting OLAF 
http://ec.europa.eu/anti-fraud/contacts/
request-visit_en

Media: http://ec.europa.eu/anti-fraud/
contacts/media-enquiries_en

Mailing address: 
European Commission/European Anti-Fraud 
Office (OLAF)/1049 Brussels, Belgium

Address for visitors: 
European Anti-Fraud Office (OLAF)/Rue 
Joseph II 30/1000 Brussels, Belgium

Executive summary

OLAF: DETECT, INVESTIGATE, PROTECT

  Fraud in the promotion of European agricultural 

products

In  2018,  the  European  Anti-Fraud  Office  (OLAF) 
concluded complex, large-scale investigations, stopping 
fraudsters  in  Europe  and  beyond  from  pocketing  EU 
money.

  Organised crime involvement in defrauding EU 

funds meant to fund refugee camps

  The evasion of customs duties by highly-organised 

criminal groups 

from 

investigations 

OLAF 
cross-border 
ranged 
cases  involving  collusion  between  beneficiaries  and 
contractors  to  major  undervaluation  fraud  cases 
where  fraudsters  made  a  profit  from  declaring  falsely 
low  values  for  goods  at  import  in  the  EU,  or  cases  of 
corruption in high-value EU tenders. 

OLAF’S INVESTIGATIVE PERFORMANCE IN 2018:

  OLAF concluded 167 investigations, issuing 256 

recommendations to the relevant national and EU 
authorities. 

  OLAF recommended the recovery of EUR 371 million 

to the EU budget. 

  OLAF opened 219 new investigations, following 1 259 
preliminary analyses carried out by OLAF experts.

TRENDS IN ANTI-FRAUD INVESTIGATIONS:

The  transnational  dimension  of  its  work  allows  OLAF 
to  form  a  unique  view  of  the  picture  of  the  changing 
nature  of  fraud  across  Europe.  OLAF  therefore  once 
again presented an analysis of some of the most striking 
trends revealed by OLAF investigations:

  Cross-border fraud schemes where shell companies 

are used to disguise fake business transactions

OLAF’S FIGHT AGAINST SMUGGLING:

In addition to its investigation and coordination cases, 
in 2018 OLAF co-organised or provided support to five 
Joint  Customs  Operations  and  has  made  significant 
progress in its efforts to fight the illicit trade in tobacco 
products  by  helping  national  authorities  seize  350 
million cigarette sticks.

CONTRIBUTION TO THE EU POLICIES TO FIGHT 
FRAUD:

OLAF  is  regularly  at  the  forefront  of  negotiating 
legislative texts concerning the protection of the EU’s 
financial  interests  against  fraud  and  corruption.  In 
2018,  OLAF  was  instrumental  in  the  development  of 
the  new  Commission  Anti-Fraud  Strategy  (CAFS).  The 
strategy  aims  to  reinforce  OLAF’s  analytical  capacity, 
further strengthen the cooperation between OLAF and 
Commission  services  and  enhance  the  Commission’s 
corporate  oversight  in  anti-fraud  matters.  OLAF  also 
worked  towards  supporting  the  entry  into  force  of 
a  new  global  anti-smuggling  treaty,  the  Protocol  to 
Eliminate  Illicit  Trade  in  Tobacco  Products,  as  well  as 
on  a  new  Commission  Action  Plan  to  fight  the  illicit 
tobacco trade. 

3

The OLAF report 2018Foreword

It is with great pleasure that, for the first time as appointed Director-General of the 
European Anti-Fraud Office (OLAF), I present OLAF’s annual report for 2018. While the 
second half of 2018 corresponds to my time in office, many of OLAF’s successes featured 
in this report were achieved under the leadership of Nicholas Ilett, the former Acting 
Director-General, whose dedication to OLAF was unparalleled. I would like to extend to 
him my utmost gratitude for the way he managed and contributed to the evolution of 
the Office. 

Although in a transitional period, I am proud to confirm that OLAF maintained a strong 
investigative performance in 2018. The Office focused its efforts on the areas where 
it could bring the most added value to  European  citizens.  Indeed,  the  cross-border 
dimension and level of complexity of cases investigated by OLAF makes them impossible 
to be tackled by national authorities alone. Whether in the area of Structural Funds, 
Customs or Research Funds, OLAF’s unique expertise and its team of highly-qualified 
investigators, digital forensic experts and analysts have helped the Office solve even 
the most difficult cases and stop organised criminals from defrauding the EU budget. In 
2018, OLAF issued 256 recommendations aimed at recovering EUR 371 million. 

By  turning  its  investigative  experience  into  anti-fraud  policy,  notably  into  fraud 
prevention  and  legislative  work,  OLAF  supports  the  EU  institutions  in  constantly 
improving  the  protection  of  EU  financial  interests.  In  2018,  OLAF  worked  with 
Commission  Directorates-General  on  the  revision  of  the  Commission’s  Anti-Fraud 
Strategy, and is now steering its implementation. The strategy aims to enhance data 
analysis  to  support  evidence-based  anti-fraud  policy  measures  and  promotes  more 
efficient anti-fraud controls based on the comprehensive examination of fraud risks. In 
practice, I envisage this leading to OLAF further developing its analytical capacities and 
becoming a European Knowledge Centre in fraud prevention and analysis, working at 
the disposal of the European institutions, as well as that of national authorities. 

The past year has also brought us closer to the establishment of the European Public 
Prosecutor’s Office (EPPO). The creation of the EPPO marks a fundamental development 
in  the  fight  against  fraud  affecting  the  EU  budget,  addressing  shortcomings  in  the 
current enforcement system and constituting a crucial step towards the creation of a 
common criminal justice area in the European Union. 

I am personally invested in ensuring a positive cooperation with the EPPO from day 
one. However, to become an even stronger partner for the EPPO, OLAF needs the right 
tools to act in a coherent manner across Member States. This is why, in revising OLAF’s 
legal basis, the Commission has proposed to equip the Office with the means it needs 
not only to be a reliable and efficient partner to the new European Prosecutor, but also 
to continue to efficiently protect the EU citizens and their money in an evolving context. 

The nature of fraud has been changing significantly over recent years and continues to 
shift in line with a more digital world, in which e-commerce develops exponentially and 
activities of criminal groups transcend national borders. In this new landscape, OLAF 
will work tirelessly to meet the expectations of EU citizens for a European Union which 
better protects not only their money, but also their health, safety and environment.

This year we mark the 20th anniversary of OLAF in tackling fraud involving EU funds. 
With an extremely capable and knowledgeable staff, a great reputation among national 
administrations and law enforcement bodies, OLAF is ready to grow and develop, in 
order to deliver on its important mandate. It is vital for us that EU citizens know that 
their money is well protected and that OLAF is there to look out for their best interests! 

Ville Itälä
Director-General of OLAF

5

The OLAF report 2018Content

1.  Mission and mandate  ............................................................................................................................................................................................................... 9

2.  OLAF investigative activity: trends in anti-fraud investigations .................................................................................................. 12

2.1.  Summary of OLAF’s investigative performance in 2018 ..................................................................................................................12

2.2. Follow the money: OLAF solves complex cases, traces EU money pocketed by fraudsters ........................... 14

2.3. OLAF’s investigative mandate within the EU institutions .............................................................................................................23

3.  Focus chapter: OLAF protects EU money from the claws of organised criminals ........................................................25

3.1.  Fraud in the promotion of agricultural products ...................................................................................................................................25

3.2. False farmers and ghost herds ............................................................................................................................................................................... 26

3.3.  Organised crime in IT projects ...............................................................................................................................................................................28

3.4. OLAF stops organised crime group trying to pocket money for refugee camps  .................................................... 29

3.5.  OLAF tackles VAT fraud with high-value electronics ........................................................................................................................30

3.6. Further successes in string of undervaluation cases ...........................................................................................................................31

4.  OLAF on the European and international scene ...........................................................................................................................................33

4.1.  OLAF relations with its partners ..........................................................................................................................................................................33

4.2. The Hercule III Programme: a key tool in supporting the fight against fraud across the EU ........................ 34

5.  Monitoring the actions taken by the recipients of OLAF recommendations  ................................................................. 36

5.1.  Financial monitoring ........................................................................................................................................................................................................36

5.2. Judicial monitoring ...........................................................................................................................................................................................................40

5.3.  Disciplinary monitoring ............................................................................................................................................................................................... 42

6.  Policies to fight fraud ............................................................................................................................................................................................................. 43

6.1.  Improving fraud prevention and detection at EU level:  

the new Commission Anti-Fraud Strategy of 2019...............................................................................................................................43

6.2. Revision of the OLAF Regulation (EU, Euratom No. 883/2013)  ...............................................................................................45

6.3. The European Public Prosecutor’s Office ......................................................................................................................................................45

6.4. Horizontal provisions on the Protection of the Financial Interests of the Union  

(PIF provisions) within all MFF Commission Proposals  ..................................................................................................................46

6.5. A new anti-fraud financial programme ..........................................................................................................................................................46

6.6. Strengthening the EU’s policy on fighting illicit tobacco trade ................................................................................................46

7.  Relations with the Supervisory Committee  ....................................................................................................................................................48

8.  Data protection, legality checks and complaints ........................................................................................................................................49

9.  Staff and Budget  .........................................................................................................................................................................................................................52

10.  Statistical annex: additional data on OLAF investigative activity ...............................................................................................55

7

The OLAF report 2018The seat of the European Anti-Fraud Office, in Brussels

8

The OLAF report 20181.  Mission and mandate 

MISSION

Detect,  investigate  and  work  towards  stopping  fraud 
involving European Union funds.

MANDATE

OLAF’s mandate is:

  to conduct independent administrative 

investigations into fraud and corruption involving EU 
funds so as to protect EU taxpayers’ money;

  to investigate serious misconduct by EU staff and 

members of the EU institutions, thus contributing to 
strengthening citizens’ trust in the EU institutions;

  to develop EU policies to counter fraud.

OLAF investigates matters relating to fraud, corruption 
and  other 
  both  EU 
illegal  activities  affecting 
expenditure and EU revenue. 

OLAF is part of the European Commission and, as such, 
under  the  responsibility  of  Commissioner  Günther 
Oettinger. 

However, in its investigative mandate, OLAF acts in full 
independence. 

In August 2018, following a selection procedure, Mr Ville 
Itälä took up the position of OLAF Director-General.

With  a  background  in  law  and  experience  working  as 
a police commissioner, Mr. Itälä kicked off his political 
career as a Member of the Finish Parliament, where he 
focused  on  fundamental  rights.  In  2000,  he  became 
Minister of the Interior, and in 2001, he was appointed 
Deputy Prime Minister of Finland.

In 2004, Mr. Itälä was elected Member of the European 
Parliament,  a  position  he  held  for  eight  years.  During 
this time, he served, among others, on the Committee 
on Transport and Tourism and was the Deputy-Chair of 
the Committee on Budgetary Control. 

Before  being  appointed  as  Head  of  OLAF,  Mr.  Itälä 
worked as a Member of the European Court of Auditors.

WHAT WE DO 

OLAF’s investigative work broadly involves:

  assessing  incoming information of potential 
investigative interest to determine whether 
there are sufficient grounds for OLAF to open an 
investigation;

  conducting administrative anti-fraud investigations, 
where appropriate in cooperation with national 
criminal or administrative investigative authorities 
and with EU and international bodies;

  supporting the anti-fraud investigations of national 

authorities;

9

The OLAF report 2018  recommending actions that should be taken by the 

  subsidy fraud in different forms, as fraudsters 

relevant EU or national authorities;

  monitoring the actions taken by these authorities, 
in order to assess the impact of OLAF’s work in the 
fight against fraud and to better tailor the support 
OLAF provides to national authorities.

Responsibilities  for  much  of  EU  spending  are  shared 
between  authorities  at  European,  national,  regional 
and  local  levels.  Even  where  EU  institutions  manage 
funds directly, the money is often spent across national 
borders and sometimes outside the EU. The detection, 
investigation  and  prosecution  of  fraud  against  the  EU 
budget can therefore only be conducted in cooperation 
with a wide range of partners, at national, European and 
international level. 

OLAF cases frequently concern: 

  cross-border procurement fraud or corruption 
in public procurement procedures involving EU 
financing;

  double funding, where, through deceit, a project is 
funded several times by different donors who are 
unaware of the contributions the others made;

take advantage of the difficulties of managing and 
controlling transnational expenditure programmes. 
Examples include the delivery of the same piece 
of research to several funding authorities within 
or beyond EU borders, plagiarism – the copying of 
research, which has already been undertaken by 
others, or the deliberate gross disrespect of the 
conditions of financial assistance;

  customs fraud where fraudsters attempt to avoid 
paying customs duties (EU own resources), for 
instance by smuggling goods into the EU.

EU bodies are, like other employers, at risk of fraud from 
their  members  and  staff  in  relation  to  remuneration, 
travel  and  relocation  allowances,  social  security 
and  health  entitlements.  They  may  also  be  at  risk  of 
corrupt activity by members and staff in procurement 
procedures,  and  of  other  forms  of  corruption  such  as 
attempts  to  illicitly  influence  decision-making  and 
recruitment procedures. To some degree, these risks are 
enhanced  by  the  transnational  nature  of  EU  business. 
OLAF  has  therefore  a  unique  mandate  to  carry  out 
so-called  “internal”  investigations  into  any  allegations 
of  misconduct  involving  staff  and  members  of  the  EU 
institutions.

OLAF investigators and Member State partners during carousel fraud operation

10

The OLAF report 2018Figure 1: EU expenditure in 2018

1.7

0 %

Special instruments

7.0 %

Administration

6.0 %

Global Europe

2.0 %

Security and citizenship

Total 
expenditure (1)
EUR 144.76
billion

46.0 %

Smart and inclusive growth

39.0 %

Sustainable growth:
natural resources

(1) Source: OJ L67, 7.3.2019, p. 13
Disclaimer: these are based on final amounts but are still subject to reliability checks by the European Court of Auditors

Figure 2: EU revenue in 2018

12.0 %

VAT-based own resource

1.0 %

Other revenue

0 %

Surplus from previous year

14.0 %

Traditional own resources 
(TOR) (75%)

Total revenue (1)
EUR 144.76
billion

73.0 %

GNI-based own resource

(1) Source: OJ L67, 7.3.2019,p. 14
Disclaimer: these are based on final amounts but are still subject to reliability checks by the European Court of Auditors

11

The OLAF report 20182. OLAF investigative activity:  

trends in anti-fraud investigations

Figure 3: OLAF’s investigative activity in 2018

219

Investigations
opened

256

Recommendations
issued

1 259

Selections completed

167

Investigations 
concluded

EUR 

371

million
Recommended
for ﬁnancial
recovery

2.1.  Summary of OLAF’s  

investigative performance  
in 2018

authorities at EU and Member State level, so it can go to 
projects that can improve the lives of all Europeans. For 
a detailed presentation of these and other performance 
indicators, please refer to the Annex to this Report. 

In 2018, OLAF opened 219 investigations after a process 
of analysing incoming information in 1 259 selections. It 
concluded 167 investigations, which led to OLAF issuing 
256 recommendations  to competent  authorities  at  EU 
and  national  level.  As  a  result  of  the  investigations 
concluded  during  2018,  OLAF  recommended  the 
recovery  of  EUR  371  million  to  the  EU  budget.  This 
money will progressively be recovered by the relevant 

In  Figure  4,  you  can  find  a  breakdown  of  the 
investigations concluded by OLAF in 2018, concerning 
the  use  of  EU  funds  managed  or  spent  in  whole  or  in 
part at national or regional level. This overview presents 
the geographical focus of OLAF’s investigative activity 
in 2018. Figure 5 shows that, as was the case in previous 
years, the “structural funds” sector remains at the core 
of OLAF’s investigative activity. 

12

The OLAF report 2018Figure 4:  Investigations into the use of EU funds managed or spent in whole or in part at national or 

regional level concluded in 2018

Country

Cases concluded

Total number per country

from which closed with 
recommendations

Hungary

Greece

Poland

Romania

Bulgaria

Italy

Czechia

France

Slovakia

Croatia

Jordan

Kenya

North Macedonia

Syria

Ukraine

Gabon

9

8

8

4

4

4

4

3

3

2

2

2

2

2

2

2

Belarus, Central African Republic, Ecuador, Egypt, Equatorial 
Guinea, Eritrea, Germany, Guatemala, Guinea-Bissau, 
Ireland, Ivory coast, Lithuania, Morocco, Mozambique, 
Myanmar, Portugal, Russian Federation, Sierra Leone, Spain, 
Turkey, Uganda, United Kingdom, Yemen

23  
(1 per country)

Total

86

Figure 5: Ongoing investigations at the end of 2018, by sector

7

6

3

2

2

2

2

3

2

2

2

2

1

1

0

0

11

48

Reporting sector

Structural Funds

Centralised Expenditure

EU Staff

New Financial Instruments

External Aid

Customs and Trade

Agricultural Funds

Social Fund

Tobacco and Counterfeit goods

Total

2015

104

58

37

8

66

50

36

21

18

2016

2017

2018

69

59

48

8

52

60

21

19

8

73

71

64

18

58

44

22

5

7

85

82

65

48

44

43

33

11

3

398

344

362

414

13

The OLAF report 20182.2. Follow the money:  

OLAF solves complex cases, 
traces EU money pocketed  
by fraudsters

For the past 20 years, OLAF has been at the forefront 
of  fighting  fraud  involving  European  Union  funds.  It 
has  solved  thousands  of  complex,  transnational  cases 
and recommended several billion euros to be returned 
to  the  EU  budget.  Years  of  experience  and  a  team  of 
highly-qualified  investigators,  forensic  experts  and 
analysts put the Office in a unique position to identify 
red flags, spot fraud patterns and efficiently investigate 
even the most intricate cases. Furthermore, as OLAF’s 
primary goal is to ensure no EU funds are lost to fraud, 
OLAF  experts  go  to  great  lengths  to  trace  defrauded 
funds, often hidden in third countries. 

In this chapter, you can find an analysis of some of the 
most  striking  trends  revealed  by  OLAF  investigations 
in  2018.  This  analysis  is  based  on  empirical  evidence, 
without amounting to a complete list of investigations 
concluded  by  OLAF.  However,  these  trends  give  an 
indication of the ways in which fraudsters try to pocket 
EU  money  and  of  the  areas  most  prone  to  fraudulent 
activities.

SHELL COMPANIES AND  
FAKE BUSINESS TRANSACTIONS 

Setting up fake companies in order to obtain EU funds 
seems to be a favourite method for fraudsters, who go to 
great lengths to disguise falsified business transactions. 
In  recent  years,  OLAF  has  investigated  an  increasing 
number  of  cross-border  cases  involving  allegations 
of  fraud  with  European  Regional  Development  Funds 
(ERDF),  including  collusion  between  beneficiaries  and 
contractors, inflated invoices and shell companies. 

For example, during one investigation OLAF 
concluded in 2018, the Office uncovered 
fake or incorrect documentation in nine 

ERDF-funded projects implemented under the 
Operational Programme “Innovative Economy” and 
worth more than EUR 4 million. The investigation, 
which took place in Poland and in Germany, revealed 
that one Polish person was managing the business 
activities of four economic operators who were the 
beneficiaries of the projects. During on-the-spot 
checks and inspections conducted in Germany, OLAF 
investigators uncovered that this individual colluded 
with two German contractors in order for the latter 
to issue incorrect or false documents that the Polish 

14

The OLAF report 2018beneficiaries would submit to the Managing Authority 
in Poland. One German contractor confessed that 
he had issued “courtesy” invoices with artificially 
increased values and that the service agreements 
concluded with the main Polish beneficiary were of 
a fictitious nature. OLAF also established that the 
invoices used to justify the financial transactions had 
been issued for goods and services that were not 
delivered or rendered.   

OLAF therefore concluded the investigation 
with a financial recommendation to the European 
Commission Directorate-General for Regional 
and Urban Policy to recover approximately EUR 
3.8 million. The Office also issued a judicial 
recommendation to the Polish District Prosecution 
Office to take into consideration the results of OLAF’s 
investigation in the context of the ongoing Polish 
criminal investigation against several individuals 
charged with subsidy fraud, participation in an 
organised crime group, money laundering and gaining 
financial benefits by misleading others. The judicial 
recommendation further advised extending the Polish 
criminal investigation to include the two German 
persons concerned by the OLAF investigation that 
colluded with the Polish beneficiaries and participated 
in the offences committed in Poland.

Similarly, in the course of another cross-border 
investigation concluded by OLAF in 2018, a 
Polish beneficiary received EUR 8 million from 

the ERDF to set up an innovative production line in 
Poland. The production line was delivered to the Polish 
beneficiary company by its German mother company, 
which was selected through a tender procedure. The 
main components of the line, produced by different 
European companies, were provided by a subcontractor 
located in Switzerland, belonging to the same group as 
the German mother company. 

Through activities carried out in Germany, Italy, 
Poland and at the Brussels headquarters, investigators 
uncovered that the tender procedure by which 
the beneficiary granted the contract to its mother 
company had been manipulated. The scope of the 
competitive procedure was unlawfully expanded 
and the mother company was granted the contract 
without a real tender procedure. The purchases of 
some components of the production line had already 
started before the official launch of the project and 
before the tender procedure for the selection of the 
supplier of the production line. The supply chain of the 
major components of the production line was complex 
and OLAF established that this facilitated the price 
of some components to be increased by about 70%. 

15

The OLAF report 2018OLAF also uncovered close personal and operational 
links between the companies involved which led to a 
conflict of interest.  

As a result, OLAF concluded its investigation 
with financial recommendations to the European 
Commission Directorate-General for Regional 
and Urban Policy for the recovery of the whole 
EUR 8 million of EU co-financing and a judicial 
recommendation to the Polish prosecution services 
to initiate judicial proceedings in relation to the 
fraudulent activities.   

In another case, OLAF received allegations 
concerning two closely related companies 
which had received European Regional 
Development Funds in order to implement two 
projects aimed at developing circular broadband 
networks in rural Hungary. The total value of 
the two projects, including the ERDF grant and 
the contributions of the two companies was 
approximately EUR 12 million.

OLAF investigators discovered that both 
beneficiaries subcontracted 100% of the works 
to the same general construction company. This 
contractor further subcontracted both jobs through a 
complex chain involving four layers. OLAF established 
that this complex chain was used to disguise the 
transfer of EUR 4.9 million back to one of the 
original beneficiaries in Hungary through a third 
party in another Member State. In this way, the two 
beneficiaries created artificial circumstances in order 
to increase the project value and to receive undue EU 
funding.

OLAF recommended that the European 
Commission Directorate-General for Regional 
and Urban Policy recover the misused amount of 
roughly EUR 3.6 million. OLAF issued a judicial 
recommendation to the competent national 
authorities to initiate criminal proceedings. 

DOUBLE-FUNDING  
IN THE RESEARCH FIELD

The academic and research fields are not exempt from 
fraud.  The  cases  OLAF  concluded  in  2018  involved 
fraudulent  double-funding,  where  researchers  either 
received  both  EU  and  national  grants  for  effectively 
doing  the  same  work  or  received  funds  from  two 
different European projects.

For example, one OLAF investigation 
concluded in 2018 concerned allegations 
of double-funding for research projects 

carried out by a big international company. The initial 
allegations suggested that the company claimed and 
received funding for the same costs, during the same 
period, from both EU research funds and from Spanish 
Torres Quevedo funds.

OLAF investigators went on-the-spot at the 

premises of the company and acquired digital forensic 
evidence. Key witnesses and persons concerned were 
interviewed. OLAF worked together with the Spanish 
Anti-Fraud Coordination Service, as well as the police, 
judiciary and Managing Authority, whose cooperation 
was crucial to the successful outcome of the case.

OLAF’s investigation confirmed that the company 

participated in eight research projects financed by 
the 7th Framework Programme for Research (FP7), 
while also obtaining 13 Torres Quevedo funding grants. 
In fact, the company claimed personnel costs for 
researchers both from the Torres Quevedo grants and 
from FP7 grants, without disclosing the existence of 
the other source of funding. Not only that, but the 
company specifically submitted declarations to the 
Spanish authority managing the Torres Quevedo grants 
indicating the absence of funding from other sources.  
OLAF calculated the total financial damage and 
issued a corresponding financial recommendation 
to the European Commission Directorate-General 
for Communications Networks, Content and 
Technology (DG CNECT). The company repaid 
to DG CNECT EUR 422 000 and to the Spanish 
authority managing the national programme the 
sum of about EUR 960 000. OLAF’s investigation 
also established strong indications that staff of the 
company committed potential crimes under the 
Spanish criminal law and therefore issued judicial 
recommendations to the Spanish judicial authorities. 
The national court proceedings are still ongoing.  

Another OLAF investigation concerned a 
university in the French Caribbean Islands, 
which benefitted from several ERDF 

and ESF-funded projects worth EUR 15 million. In 
particular, a laboratory located in Martinique, which 
was part of the university, initiated three projects in 
the framework of the INTERREG IV Caraïbes Initiative, 
mostly in partnership with Haiti.

OLAF investigators conducted numerous 
interviews with the persons concerned, which 
included high-ranking officials of the university and 
private contractors closely linked to the staff. OLAF 
also heard several witnesses, in close coordination 

16

The OLAF report 2018with the French police and Gendarmerie in 
Martinique, Guadeloupe, Bordeaux and Paris. Several 
criminal investigations were conducted in parallel with 
OLAF’s administrative investigation.

OLAF investigators discovered that certain 
individuals had attempted to circumvent EU and 
national legislation relevant for public procurement, 
as well as to declare fraudulent mission fees, fake 
diplomas and sham project activity reports. They also 
attempted to use false supporting documents to claim 
the eligibility and reimbursement of costs.

For example, some professors who did not 

contribute at all to the three projects were allegedly 
contributing to seminars and missions, the costs of 
which were charged to the budget of the projects.  
Several professors received payments from 
institutional partners, without approval or even 
knowledge of the university, while being paid full-time 
by their original employer. 

Moreover, one contract was attributed without 
any procurement procedure to a staff member of 
the laboratory in Martinique. The use of “creative 
accounting” practices allowed the laboratory to claim 
reimbursement for various costs without any link to 
the subsidised project - such as social events, sporting 

clothes, very expensive tools or medical items - or to 
re-cycle IT costs incurred in the framework of other 
projects. 

OLAF’s investigation was concluded with 
recommendations to the Directorate-General for 
Regional and Urban Policy and the Directorate-
General for Employment, Social Affairs and Inclusion 
to recover EUR 4.6 million as well as to the competent 
national judicial authorities. Investigators believe 
that weaknesses in the management systems of the 
beneficiary, which was split over three islands, of 
the Haitian partners and of the French Managing 
Authorities contributed to the magnitude of the fraud. 

INVALID FINANCIAL GUARANTEES AND 
CONFLICT OF INTEREST  
IN DEVELOPMENT PROJECTS

While  the  correct  distribution  of  development  aid 
can  make  the  difference  between  life  and  death  for 
thousands  of  people,  development  projects  can  also 
fall  prey  to  fraudsters.  Many  of  the  places  where 
development funds are paid out are not the easiest to 
work  in.  The  general  environment  can  be  fragile  and 

17

The OLAF report 2018volatile,  subject  to  frequent  and  rapid  change.  This 
makes the risk of fraud and corruption very high, but also 
means that investigating is going to be quite difficult.

OLAF  investigators  uncovered  companies  and  orga-
ni sations  which  sometimes  use 
financial 
guarantees to secure EU funds, which means that poor 
performance, irregularities and fraud committed during 
the  implementation  phase  cannot  be  sanctioned  by 
execution of these financial guarantees. 

invalid 

Conflict of interest also features prominently 
in external aid cases, sometimes involving 
large public procurement projects. For 
example, OLAF received allegations that a local 
agent employed as a project manager in a European 
Union Delegation in Latin America was playing a key 
part in the mismanagement of EU funded projects. 
OLAF investigators went on the ground to carry 
out interviews, perform on-the-spot checks and 
acquire relevant digital evidence. OLAF also collected 
documentary evidence such as invoices, payments, 
contracts and correspondence. 

Investigators established that some of the 
local agent’s family members were involved in the 

implementation of a rural development project he was 
super vising. In addition, the family received consistent 
payments from the Foundation that was implementing 
the project and that was the beneficiary of the EU 
funds. Moreover, OLAF discovered that the project 
in question was only partially implemented by the 
Foundation, that substantial financial irregularities 
were committed and that almost all of the declared 
expenses were ineligible. 

Additional cases of conflict of interests also 

surfaced, as the local agent’s wife provided 
consultancy services in the framework of EU-
funded projects he was in charge of as evaluator 
or programme manager. The local agent was also 
involved in an unauthorised external activity as owner 
of a commercial company.

Immediately after its mission, OLAF asked the EU 
Delegation to adopt precautionary measures in order 
to prevent the local agent from committing further 
irregularities. The EU Delegation dismissed the local 
agent, based on the documentary evidence collected 
by OLAF during the mission, the on-the-spot check at 
the premises of the Foundation and the interview of 
the person concerned.

OLAF also issued a disciplinary recommendation 

concerning the local agent and a financial 

18

The OLAF report 2018recommendation aimed at recovering EUR 400 000 
from the beneficiary Foundation.

CORRUPTION AND KICK-BACKS  
IN THIRD COUNTRIES

To  solve  complex  transnational  fraud  cases  and  trace 
the proceeds of fraud, OLAF often works together with 
national and international authorities. These authorities 
recognise OLAF as a trusted partner with unique expertise 
in managing cases of fraud and corruption with EU funds, 
and ensuring that the EU budget is well protected. 

In one such investigation concluded in 2018, 
OLAF reached out to the Dutch judiciary to 
acquire information on a Dutch company 
which had allegedly used corruption to manipulate 
several high-value EU tenders. The analysis of digital 
material provided by the Dutch partners, who had 
already conducted a criminal investigation concerning 
corruption in the context of World Bank tenders 
by the same company,  helped OLAF investigators 
spot similar corrupt practices in a EUR 1.5 million 
EU-funded project aimed at  supplying medical 
instruments and equipment in Latin America. 

Through document analysis and on-the-spot 

checks, OLAF investigators established that the Dutch 
company had access to confidential documentation 
and information prior to the publication of the tender 
and had paid bribes to a key person working in the 
organisational structures of the project in Latin 
America. The company had also relied on the services 
of their subcontractor and of a local businessman to 
communicate with the corrupt official and to hide the 
payment of the bribes.

OLAF concluded the investigation with a financial 

reco mmen dation to the Directorate-General for 
Interna tional Coope ration and Development (DG 
DEVCO) to recover the entire amount of EU funds 
disbursed in the context of the project, a judicial 
recommendation to the Dutch Prosecutor, as well as 
an administrative recommendation to DG DEVCO to 
blacklist the Dutch company so it cannot access EU 
funds for a certain number of years. 

OLAF’s investigation uncovered a fraudulent scheme, 

involving governmental institutions and officials, set 
up in order to obtain financial benefits in exchange 
for the awarding of EU-funded contracts. An Italian 
company had set up a network of Balkan partners 
which unlawfully supported the company in winning 
EU-funded contracts totalling more than EUR 2 million. 
Through its partners, the Italian company gained access 
to confidential information related to the procurement 
procedures. Additionally, the Italian bidder bribed high-
level public administration officials in order to influence 
the outcome of the work of the evaluation committee 
which eventually awarded the contract to the bidder.

During the course of the investigation, OLAF 

worked together with the Special Prosecutor’s Office 
in the Balkan country, the Prosecutor Office in Milan 
and the Italian Guardia di Finanza. OLAF conducted 
several witness interviews and carried out an on-the-
spot check including a digital forensic operation at the 
premises of the Italian company. 

OLAF concluded its investigation with a financial 

recommendation to the Directorate-General for 
Neighbourhood and Enlargement Negotiation 
(DG NEAR) to recover the entire amount disbursed, 
and with judicial recommendations to the Italian 
judicial authorities to consider prosecuting the 
persons concerned.

CIGARETTE SMUGGLING  
AND ILLEGAL TOBACCO FACTORIES

Corruption also lay at the heart of an 
investigation OLAF conducted in a Balkan 
country regarding alleged irregularities, 

fraud and corruption committed in the framework of 
projects financed through the Instrument for Pre-
Accession Assistance (IPA).  

OLAF  has  a  unique  investigative  mandate  to  combat 
tobacco smuggling into the EU which causes huge revenue 
losses  to  the  budgets  of  the  EU  and  of  the  Member 
States. In complex cross-border cases in particular, OLAF 
brings  significant  added  value  by  helping  coordinate 
anti-smuggling  operations  carried  out  by  customs  and 

19

The OLAF report 2018OLAF and Member State Customs work together to keep our borders safe

justice.  International 

law-enforcement  agencies  across  Europe  and  beyond. 
OLAF  works  to  ensure  that  contraband  cigarettes  are 
seized, evaded duties are recovered, criminal smuggling 
networks  are  dismantled  and  perpetrators  brought 
to 
information  exchange  and 
collaboration facilitated by OLAF led to seizures of more 
than 307 million cigarettes in 2018. Also based on detailed 
information provided by OLAF, four illegal factories were 
raided in Greece and Spain, which led to large seizures of 
tobacco and to over 40 arrests.

For  the  past  years,  OLAF  has  been  paying  particular 
attention to smuggling by passengers travelling by air 
and  who  carried  significant  amounts  of  cigarettes  in 
their luggage. 

For example, OLAF received information 
from reliable sources regarding potential 
smugglers departing from third country 

airports and destined for the EU, allegedly smuggling 
significant quantities of cigarettes in their luggage.

OLAF investigators decided that concerted and 
strategic action should be taken. Therefore, OLAF 
opened a case targeted at increasing controls and 

enhancing information exchange between the 
relevant enforcement authorities. As a result, OLAF 
received information on 377 air passengers which led 
to 157 seizures totalling 3.5 million cigarettes. Some 
of the perpetrators were “frequent flyers” who were 
entitled to carry excess luggage and used this facility 
to assist in the smuggling of the cigarettes. The 
purchase, transport, dissemination and sale of the 
illicit cigarettes in the countries of destination were 
organised by criminal groups based in Eastern Europe 
with connections to Western European criminals who 
received and distributed the cigarettes.

In 2018, OLAF also focused on transit fraud 
involving the misdeclaration of cigarettes 
from Turkey. Two major anti-smuggling 

operations facilitated by OLAF resulted in the seizures 
of more than 130 million cigarettes by Belgian and 
Dutch authorities. The cigarettes, originating from a 
Turkish company, had arrived in the ports of Antwerp 
and Rotterdam either mis-described as other goods or 
declared to be in transit to a non-EU country. Smugglers 
tried to unlawfully discharge the cigarettes during their 
road transport between the port of arrival and the 
declared port of departure from the European Union.

20

The OLAF report 2018As a result of OLAF intelligence, the Dutch Fiscal 
Intelligence and Investigation Service seized 45 million 
cigarettes, two trucks and EUR 130 000 in cash. In 
addition, the operation also led to the dismantling of 
an illegal cigarette production site.

SMUGGLING WATER PIPE TOBACCO

In October 2018, OLAF started monitoring 
movements of water pipe tobacco declared 
under the EU transit system, as it was 

considered to be at a high risk of smuggling into 
the EU. As a result of this monitoring operation, in 
November OLAF identified a suspicious consignment 
originating in Turkey and declared as destined for the 
United Kingdom.

OLAF’s analysis revealed that the consignee did 
not actually exist, so OLAF investigators shared this 
information with France, Germany and Italy, the 
Member States that the shipment was transiting. OLAF 
also coordinated the exchange of information between 
the Member States involved, which confirmed that 
the goods were in France after the consignment had 
arrived from Turkey through Italy and Germany. 

It was discovered that the transit document had 
been closed in Germany using false documents, and 
that the water pipe tobacco had been declared as 
“machinery.”

As a result of the information provided by OLAF, 
in November the French National Customs Operation 
Unit seized approximately seven tons of water pipe 
tobacco and arrested three persons. 

OLAF AT THE HELM  
OF TRANS-EUROPEAN JOINT  
CUSTOMS OPERATIONS

In  addition  to  its  investigations  concerning  cases 
of  revenue 
large-scale 
fraud,  OLAF  coordinates 
Joint  Customs  Operations  (JCOs)  involving  EU  and 
international  operational  partners.  JCOs  are  targeted 
actions  of  limited  duration  that  aim  to  combat  fraud 
and the smuggling of sensitive goods in specific areas 
at risk and/or on identified trade routes. In 2018, OLAF 
co-organised or provided support in five Joint Customs 
Operations. The Virtual Operations Coordination Unit 
(VOCU) module of the Anti-Fraud Information System 
(AFIS) was used for the secure exchange of information 
in  four  of  these  JCOs.  The  Permanent  Operational 
Coordination Unit (POCU) in OLAF was used to support 
Poseidon. This JCO was financed by OLAF.

Operation  Silver  Axe  III  was  coordinated  by  Europol 
with support from OLAF, and led to the seizure of 360 
tons  of  illegal  or  counterfeit  pesticides.  Numerous 
police,  customs  and  plant  protection  authorities  from 
27 countries participated in the Operation. As part of 
the  Operation,  checks  took  place  at  major  seaports, 
airports and land borders, as well as at production and 
repacking facilities in the participating countries.

During  the  operational  phase,  OLAF  selected  181 
suspicious  shipments  of  pesticides  coming  from  third 
countries  (mainly  China),  that  were  either  declared  as 
being in transit in the EU or declared as being for export 
from the EU to another third country (Russia, Ukraine, 
Moldova,  Turkey).  These  suspicious  shipments  were 
notified to the participating national and third country 
customs authorities by OLAF directly or via Europol.

OLAF identified a further two suspicious shipments 

of water pipe tobacco transiting the EU and destined 
for North Africa, which were subsequently diverted 
to Lithuania. The cooperation with the Lithuanian 
Customs Criminal Service on these shipments resulted 
in approximately three more tons being seized.

For  example,  OLAF  asked  Hungarian  and  Slovak 
customs  to  intercept  a  suspicious  consignment  of 
20,400  kg  pesticides  (thiamethoxam  350  g/l)  on  its 
way from China to Hungary via Ukraine. The shipment 
containing  unmarked  packaging 
indication 
of  producer,  country  of  origin,  trade  name)  was 

(no 

Figure 6: Cigarettes seized with the support of OLAF (rounded to million sticks) 

Year

Coordination and investigation 
cases/Exchange of information

JCOs 

Total

2014

168

132

300

2015

602

17

619

2016

458

11

469

2017

470

75

545

2018

302

48

350

21

The OLAF report 2018successfully  seized  at  Szolnok  by  Hungarian  customs 
officers  (NTCA)  and  the  experts  from  the  National 
Food  Chain  Safety  Office  (NFCSO).  The  real  customs 
value  of  the  shipment  exceeded  USD  240  000.  The 
retail  value  of  the  genuine  pesticide  would  exceed 
USD  1  million.  In  addition,  OLAF  also  contributed  to 
stopping  another  suspicious  shipment  of  5.4  tons  of 
pesticide  (thiacloprid)  initially  transported  under  a 
customs  transit  regime  from  Turkey  to  Germany  and 
later on from Germany to Czechia.

Joint  Border  Control  Operation  (JBCO)  Janus  was 
co-organised by the European Union Border Assistance 
Mission to Moldova and Ukraine (EUBAM) and OLAF. 
The  operation  targeted  the  smuggling  of  tobacco 
products at the EU Eastern border and resulted in the 
seizure of more than seven million cigarettes.

Joint  Action  Hansa,  an  operation  driven  by  United 
Kingdom  customs 
in  co-operation  with  Europol, 
targeted  the  internal  movement  of  illegal  excisable 
goods,  mainly  cigarettes.  The  action  resulted  in  the 
seizure  of  41  million  cigarettes  and  11.5  tons  of  raw 
tobacco.

JCO  Marco  was  a  regional  maritime  surveillance 
operation  coordinated  by  French  customs,  which 
targeted the detection of illicit trafficking of sensitive 
goods by sea, in the area of the Atlantic.

Data analysis  
to facilitate the work  
of customs authorities
During 2018, OLAF started a Hercule III‑funded 
project, working with the European Commission’s 
Joint Research Centre, to support and facilitate 
the  analytical  work  of  customs  services  in 
Member  States  in  order  to  effectively  and 
efficiently use data and analytical approaches to 
address fraud in the customs area.
focused  on 
first  year 
in  this 
Activities 
establishing  a  community  of  practice  among 
Member  States’  customs  and 
included  a 
consultation  on  needs  and  priorities,  two 
workshops  to  discuss  current  practices  and 
agree  on  areas  of  interest  and  five  visits  to 
Member States to share information about their 
analytical projects and associated challenges.
The  positive  feedback  from  the  community 
clearly showed that this project has already had a 
positive impact in strengthening the know‑how 
and collaboration among experts. The findings 
affirm that customs fraud, notably in the context 
of  e‑commerce,  remains  a  priority  for  all  EU 
customs administrations, some of whom address 
this  priority  by  investing  substantial  resources 
in  data  analysis  and  obtain  important  results. 
On  the  other  hand,  organised  crime  groups 
are  involved  in  some  areas  of  customs  fraud 
and  often  their  illegal  activities  span  several 
risk  areas  (undervaluation,  mis‑declaration  of 
origin, mis‑description of goods, illicit tobacco, 
etc.),  they  act  in  multiple  Member  States  and 
exploit  the  structure  of  the  EU  single  market. 
This  project  will  be  continued  in  2019  with 
focus on specific research projects and support 
activities  discussed  and  agreed  with  Member 
States’ customs.

22

The OLAF report 20182.3. OLAF’s investigative mandate 
within the EU institutions

OLAF  has  a  unique  mandate  to  carry  out  internal 
investigations into the EU institutions, bodies, offices and 
agencies for the purpose of fighting fraud, corruption and 
any other illegal activity affecting the financial interests of 
the Union. The Office investigates serious matters relating 
to  the  discharge  of  professional  duties  constituting  a 
dereliction of the obligations of EU officials liable to result 
in disciplinary or, as the case may be, criminal proceedings, 
or  an  equivalent  failure  to  discharge  obligations  on  the 
part  of  Members  of  institutions  and  bodies.  Indeed,  any 
perceived lack of integrity within the institutions presents 
a reputational risk not only to the institutions themselves, 
but  also  to  the  European  project  as  a  whole.  OLAF  also 
works  with  the  EU  institutions  and  bodies  to  help  them 
detect, prevent and address any such possible cases.

For example, an OLAF investigation 
concluded in 2018, revealed that a Member 
of an EU Institution carried out many 
“missions” which were not related to the performance 
of his/her duties, and used the institution’s funds 
for representation expenses and for private events. 
The investigation also established that the Member 
was absent from the institution for 128 days without 
any justification and that the fuel cards, put at the 
Member’s disposal, were also used for activities that 
were not linked to the fulfilment of his/her mandate. 
The use of the institution’s resources for private 
purposes is not in compliance with the applicable 
financial rules and ethical guidelines. 

In this light, OLAF recommended disciplinary 

measures and the recovery of more than EUR 500 000.

In addition, OLAF issued a judicial recommendation 

taking into account that the Member deliberately 
misrepresented the private nature of at least five 
significant missions. These facts may constitute a 
criminal offence pursuant to the applicable criminal 
law and OLAF issued a corresponding judicial 
recommendation. 

The investigation revealed that the Member failed 

to declare his/her external activities related to the 
management board of a national political party and 
his/her position as managing director of a real estate 
company. The Member also transmitted confidential 
special reports to unauthorised persons. 

In  2018,  OLAF  also  dealt  with  a  significant  number  of 
cases related to EU Agencies as well as to Delegations 
to third countries.

One OLAF investigation stemmed from an 
anonymous source reporting the alleged 
misconduct by the Executive Director of an 
EU Agency. The allegations referred to irregularities 
in procurement procedures and to alleged 
mismanagement of financial and human resources. 

OLAF investigators looked into specific cases of 
procurement where exception procedures were used 
despite the fact that the conditions for their use 
were not met. OLAF established that the Executive 
Director failed to ensure that specific procurement 
procedures were conducted in line with the principles 
of sound financial management, open competition 
and transparency. This resulted in an unjustified 
expenditure for the Agency and exposed the Agency to 
a high risk of litigation.

Figure 7: Investigations into EU staff and members of the institutions concluded in 2018

Institution, body office, agency

Cases concluded

Total number

of which, concluded with 
recommendations

European Commission

European Parliament

Agencies

European Court of Justice

European External Action Service

Committee of the Regions

Total

9

8

5

2

2

1

27

7

2

3

2

2

1

17

23

The OLAF report 2018OLAF also examined specific cases of expenditure, 

including settlement agreements with Agency 
staff members. These were found to be excessive, 
inappropriate, against the interests of the Agency and 
against the sound financial management principle. 

In relation to the mismanagement of human 

resources, OLAF established that the Executive Director 
abused his position as line manager in relation to 
recruitment procedures, termination and non-extension 
of contracts, working conditions, task assignments and 
non-respect of the positions of his line managers.

In his behaviour towards members of staff, the 
Director undermined the personal and professional 

dignity of those who raised concerns in relation to the 
regularity and appropriateness of his decisions.

In light of the OLAF investigation and mounting 

pressure from the staff of the Agency, the 
Executive  Director resigned from his position, 
which was welcomed by the Management Board 
of the Agency. OLAF recommended the recovery 
of a substantial amount from the Executive 
Director and invited the Agency to determine 
other specific amounts resulting from unjustified 
expenditure. OLAF addressed recommendations 
for disciplinary action to the Agency’s Management 
Board concerning its former Executive Director. 
Recommendations were also issued against several 
members of staff.

24

The OLAF report 20183. Focus chapter: OLAF protects EU money 
from the claws of organised criminals

In  recent  years,  OLAF  investigations  have  become 
more  and  more  complex.  Instead  of  localised  fraud, 
set  in  one  region  or  country,  OLAF  investigators  are 
faced  with 
increasingly  transnational  cases,  with 
fraudsters operating across several Member States and 
sometimes beyond them. Organised criminals defraud 
EU  funds  and  abuse  EU  and  national  rules  by  hiding 
their tracks and activities around Europe. They skillfully 
exploit every possibility to try to appropriate EU funds 
by  manipulating  procurement  procedures,  receiving 
agricultural grants for plots of land they did not farm, 
or misdeclaring imports to avoid paying customs fees. 
In this chapter, we will delve deeper into the workings 
of  organised  criminals  attempting  to  steal  EU  money 
and  show  you  how  OLAF  goes  after  these  groups 
across  EU  borders.  OLAF  intervention  is  frequently 
the only chance that Europe has to protect its money 
and  ensure  EU  funds  go  to  legitimate  projects  which 
improve  the  lives  of  European  citizens.  Work  begins 
often  by  detecting  situations  that  look  suspicious 
only  if  seen  from  a  cross-border  perspective.  OLAF 
can put together information and data that would not 

necessarily  appear  illegal  if  looked  at  from  a  national 
perspective only.

3.1.  Fraud in the promotion  
of agricultural products

In the past years, OLAF investigators have been dealing 
with an increase in a subset of cases - those of alleged 
fraud  in  the  promotion  of  EU  agricultural  products. 
Fraudsters try to circumvent EU rules by setting up fake 
companies to act as bidders in tender procedures or to 
pretend  to  supply  services  or  to  help  inflate  invoices. 
Defrauded  funds  are  then  laundered  through  bank 
accounts, usually in third countries. 

For example, OLAF concluded a string 
of investigations relating to the same 
perpetrators who were applying similar 

methods to defraud EU funds in a large number of 

25

The OLAF report 2018Figure 8: Four-Step EU Funds Fraud

Fraud 
partner hunt
Fraudsters approach 
trade associations in EU 
Member states oﬀering to 
help them secure EU 
funding.

1

Applicants 
get EU Funds
Agri producers 
receive money to 
implement promo-
tion activities of agri 

products in Europe and 
third countries.

3

Time
to cash in
Fraudsters create shell 
companies to act as 
tenderers, suppliers and 
implementing body for the 
beneﬁciaries.

4

Helping hand
They even lend 
"applicants" the 20% 
beneﬁciary co-funding 
contribution and 15% 
performance guarantee.

2

projects aimed at promoting EU dairy products in 
Europe and in third countries. The perpetrators, 
operating through a Brussels-based company and via 
a network of shell companies, would approach trade 
associations in the Member State offering to help 
them secure EU funding – a “turn-key” solution for 
the successful approval of their proposals, as well as 
practical support for their future implementation. 
The fraudsters would even go as far as to lend the 
“applicants” the 20% co-funding contribution of 
the beneficiary and the related 15% performance 
guarantee required by the relevant legislation. In this 
manner, some agricultural producers’ associations 
obtained EU funding to organise and implement 
promotion activities of agricultural products in 
Europe and in third countries such as the United Arab 
Emirates, Russia, Australia, Kazakhstan, and Ukraine. 
The fraudsters would then create a circle of shell 
companies under their control, to fulfil the roles of 
tenderers, suppliers and implementing body for the 
beneficiaries.

Through more than 30 on-the-spot checks in 
different Member States, as well as interviews with 
witnesses and persons concerned and forensic data 
acquisition, OLAF investigators got to the bottom of 
the case. They discovered that the fraudsters were 
colluding with the beneficiaries and other commercial 
partners and manipulating tender procedures by 
using misleading documents and resorting to kick-
back payments. These fraudsters would then use shell 
companies, which had neither operating premises 
nor employees, in order to inflate prices for services 

that were only partly, or sometimes never delivered. 
Money was then laundered through bank accounts 
in Europe and in third countries such as Ukraine 
and the British Virgin Islands. In particular, with the 
support of the Belgian national authorities, OLAF was 
able to uncover that one of the persons concerned 
received high amounts in his bank accounts, which he 
transferred almost immediately, without any kind of 
economic justification or business purposes. 

OLAF’s investigations were concluded with 

financial recommendations to the European 
Commission Directorate-General for Agriculture 
and Rural Development to recover EUR 7.7 million 
and prevent the disbursement of an additional EUR 
7.3 million, and judicial recommendations to the 
Prosecutor’s Offices of Brussels and Sofia.  

3.2. False farmers and ghost herds

When  it  comes  to  fighting  complex  fraud  cases 
perpetrated  by  highly-organised  criminals,  experience 
comes  in  handy.  OLAF  investigators  are  not  only 
dedicated, they also have years of practice behind them. 
This helps them quickly identify patterns and apply the 
knowledge they have gathered to not only solve cases 
quicker, but to identify new potential areas of fraud.

As  outlined  in  last  year’s  report,  for  example,  OLAF 
has  looked  into  suspected  fraud  involving  ineligible 
applications  for  EU  agricultural  subsidies  in  Italy.  This 
became known as the “False farmers” case, as fraudsters 

26

The OLAF report 2018had  submitted  aid  applications  under  the  names  of 
deceased persons, with false lease contracts and using 
land  that  was  ineligible  for  agricultural  subsidies.  In 
this  instance,  OLAF  and  the  Italian  law  enforcement 
authorities  uncovered  not  only  a  very  elaborate  and 
wide-ranging  fraud  scheme,  but  also  possible  links  to 
Mafia organisations.

Fearing that the same fraud pattern could have been used 
by criminals in other European countries, investigators 
looked everywhere in Europe. Their instincts were right, 
as it became clear that this “False farmers” scheme has 
been exported beyond the borders of Italy.

For example, OLAF has been looking 
into systematic abuses regarding direct 
payments to individual farmers in France. 

OLAF investigators discovered claims for EU support 
for large and remote plots of land that were not 
actually farmed, claims for plots of land belonging to 
other individuals who had not granted appropriate 
permission, the so-called “agro-pirate” cases, or for 
“ghost-herds”, which are animals that were never 
properly identified and unlikely to exist. OLAF also 
uncovered claims for EU support for plots of land 
where no entitlements for farming could be provided 

by the beneficiary or simply claims for plots that were 
not even farmed. 

In the course of one investigation, OLAF discovered 
that claims were submitted for several years in Corsica 
for parcels of land in mountainous areas without any 
suitable infrastructure that would allow for farming, 
such as access track, water supply, corrals or feeding 
facilities. Fraudsters also submitted applications 
for parcels of land despite the fierce opposition of 
the legitimate owners, or for herds which were not 
properly tagged or even non-existent.

In another investigation, OLAF could identify an 

application for payment submitted by a full-time 
hairdresser for very steep cliffs where no animal had 
ever set foot. Still another application was submitted 
by a farmer for a tiny parcel of land belonging to the 
managing authority itself.

OLAF investigators conducted interviews with 

the persons concerned, carried out on the spot 
checks and held numerous operational meetings with 
the Directorate-General for Agriculture and Rural 
Development (DG AGRI) and the national managing 
authorities, external services of the Ministry of 
Agriculture, judicial authorities and the police. 
As a result, investigators not only uncovered 
several fraud cases, but also put together evidence 
that the complexity of the successive layers of 

27

The OLAF report 2018legislation applicable to agricultural payments, 
updated annually, was an important factor in creating 
legal uncertainty and led to difficulties in properly 
implementing, monitoring and controlling where the 
money goes exactly.

OLAF concluded its investigation with a financial 

recommendation to the Directorate-General for 
Agriculture (DG AGRI) for the recovery of roughly 
EUR 536 000, as well as with an administrative 
recommendation to improve the management system 
of direct subsidies in Corsica, in order to prevent 
further abuses. OLAF’s investigation also triggered 
an audit by DG AGRI, additional targeted inspections 
by national authorities and various expert missions by 
the French General Inspectorates. 

Claiming EU funds for plots of land is not the 
only way organised criminals try to pocket 
EU cash. OLAF investigators have also noted 

an increase in cases where several entities act in a 
concerted manner in order to fraudulently access EU 
funds. OLAF discovered that established agricultural 
operators in Bulgaria, who were past beneficiaries 
of EU agricultural funds, attempted to expand their 
operations and holdings by creating and using new, 
and seemingly independent, operators.

The fraud scheme operated in the following 

manner: an established known operator reaches the 
limit for the total eligible cost for EU financial support 
for his holding or group of holdings. As a result, this 
operator cannot legitimately obtain further funding 
to expand his business. Instead, other “independent” 

Figure 9: Fraud in the IT field

entities, which are actually under the control of the 
initial operator, apply and obtain EU funds. 

The new “independent” operators are either set 
up especially for this purpose, or they already exist 
through a creative legal restructuring that makes them 
appear like they are not under any formal control. 
In reality, they are managed by the operator: they 
usually share an equity provider, guarantor, creditor or 
landlord, and they have an identical or complementing 
core business. Also, many times, the physical location 
of their holding, the address for correspondence and 
their choice of suppliers and outlets are the same as 
that of the established operator.

This type of fraud is not only damaging for EU 
financial interests, but it also distorts free and fair 
competition, prevents the growth of agricultural 
operators and stems private initiatives. The combined 
financial impact of the cases OLAF has analysed so far 
is roughly EUR 10 million.

3.3. Organised crime in IT projects

Some criminals go to great lengths to pocket 
EU cash. OLAF discovered that an economic 
operator in Poland had devised a whole 

system aimed overwhelmingly and increasingly at 
defrauding public funds and systematically abusing 
tendering procedures.

OLAF investigators found out that the economic 
operator had implemented 10 projects with an overall 

A Polish company devised a 
system to defraud public funds 
and abuse tendering procedures.

1

4

OLAF recommended 
the recovery of €10 
million.
Criminal proceedings into 
the company’s activities 
were launched in Poland.

The operator implemented projects 
worth €10 million.
They also provided consulting 
services on obtaining EU funding 
worth another several million.

2

3

OLAF digital forensics found 
a complex web of companies which:

- set up tenders,
- provided false statements,
- misrepresented activities in EU projects.
The company had covered its tracks using shell 
companies in the United Arab Emirates.

28

The OLAF report 2018value of about EUR 10 million, and which were likely 
to have been affected by fraud or irregularities. Most 
of the funds went towards IT-centred work, including 
projects concerning the creation or the acquisition 
of software. In addition, OLAF realised that the 
economic operator provided consulting services on 
obtaining EU funding, which meant that dozens of 
additional EU co-funded projects, worth millions of 
euros in public funding, could be affected by fraud as 
well.

Given the vast scope of the company’s activities, 

OLAF decided that only a complex digital forensic 
analysis would give investigators the possibility to 
determine whether the activities were fraudulent and 
to reconstruct the whole picture of the fraud.

Following the analysis of the data, OLAF uncovered 

an intricate fraud scheme, conducted with the 
involvement of many employees. Investigators 
discovered an orchestrated system of companies 
which systematically rigged tenders, provided false 
statements of facts towards managing authorities, 
misrepresented the activities conducted within EU 
co-funded projects and led external stakeholders 
into committing irregularities or fraud. The group 
consisted of companies which were formally 
independent but in reality formed one economic 
body. Additional companies owned by employees 
of the economic operator and collaborating third 
party economic operators completed the picture. The 
existing connections between the companies were 
concealed from the Polish authorities through the use 
of shell companies from the United Arab Emirates. The 
apparent suppliers employed the same staff as the 
person concerned or provided paper services to the 
person concerned in order to circulate the money.

OLAF concluded its investigation with a financial 

recommendation to the Directorate-General 
for Regional and Urban Policy and a judicial 
recommendation to the Polish General Prosecutor. 
Criminal proceedings into the company’s activities 
were launched in Poland.

3.4. OLAF stops organised crime 

group trying to pocket money for 
refugee camps 

With conflicts in Syria and in many other parts of the 
world forcing millions of people to flee their homes and 
to seek refuge elsewhere, the European Union stepped 
up its efforts as a leading donor, providing emergency 
assistance,  such  as  medical  and  food  aid,  water  and 
shelter. However, reports started coming in that several 
refugee  centres  were  badly  maintained  and  that  the 
conditions did not live up to the standards of funding 
provided.  OLAF  started  looking  into  the  matter,  to 
ensure  that  there  is  no  foul  play.  An  investigation 
OLAF  concluded  into  a  project  financed  by  the 
European  Refugee  Fund  (ERF)  for  the  management 
of  accommodation  centres  for  asylum  seekers  and 
refugees in Italy revealed that the situation was dire.

Not only did OLAF’s investigation uncover 
irregularities in the execution of the public 
procurement and little control over the 

implementation of the project, but it also exposed 
outright fraud in declaring the quantity of meals 
supplied to the asylum-seekers, refugees and people 
in need accommodated at the centres, who were often 
left starving or nourished with food products bordering 
the limits of edibility. OLAF’s investigation also 
unveiled connections among companies, interaction 
with criminal organised groups and serious crimes 
aimed at manipulating public procurement and illegally 
obtaining public funding. In particular, OLAF uncovered 
that the awarding body delegated the execution of the 
entire project to its local partner, in breach of public 
procurement rules, withholding a lump-sum of 5%. The 
two bodies had entered into a private agreement that 
was never notified to the contracting authority, which 
therefore could not perform the necessary checks. 
Several breaches of the Italian Public Procurement Code 
were detected, which ultimately led to the violation of 
traceability of financial flows, including the required 
anti-mafia checks. The competent Anti-Mafia Public 
Prosecutor’s Office of Cantazaro in Italy has launched 
an investigation against 84 persons concerned, as it is 
believed they could be linked to mafia groups. 

OLAF investigators conducted on-the-spot 

checks, held coordination meetings and cooperated 
with the local Unit of the Guardia di Finanza, the 
competent Italian judicial authorities, and received 

29

The OLAF report 2018significant technical support from the Italian National 
Anticorruption Authority.

the  accumulated  VAT.  The  fraudulent  financial  profits 
from these schemes are then often laundered. 

As a result, OLAF recommended that the 

Directorate-General for Migration and Home Affairs 
(DG HOME) of the European Commission exclude from 
funding nearly EUR 1.4 million, the full amount of the 
EU contribution, and issued a judicial recommendation 
to the competent District Anti-Mafia Directorate 
to take into consideration OLAF’s findings in the 
framework of the ongoing criminal proceedings.

3.5. OLAF tackles VAT fraud  

with high-value electronics

VAT fraud is a major problem throughout the EU. While 
trade facilitation regimes allow for VAT to be paid in the 
Member State the goods are destined for, this can be 
abused by fraudsters to avoid paying duties altogether. 
Criminals  come  up  with  complex  carousel  schemes, 
whereby the same goods are bought and resold several 
times  via  middlemen.  Each  time,  the  amount  of  tax 
owed  increases  but  the  company  either  disappears  or 
becomes insolvent before the tax authority can collect 

OLAF  is  mandated  at  European  level  to  protect  the 
financial interests of the EU from fraud. In this context, 
in  2018,  OLAF  supported  the  efforts  of  Italian  and 
Romanian law enforcement officials in putting an end 
to a fraudulent pattern involving high-value electronics.

Working together, the Romanian National 
Anti-corruption Directorate (DNA), the 
Italian Guardia di Finanza and OLAF 
discovered that a complex carousel fraud scheme was 
set up to evade VAT duties on the sale of electronic 
devices. Fraudsters would avoid paying VAT to Italian 
authorities using shell companies throughout Europe 
and foreign bank accounts to hide their identity. The 
amount of evaded VAT is estimated at around EUR 30 
million. 

OLAF supported the Italian Prosecutor by liaising 
with the Romanian authorities and alerting them to 
the fact that the fraudsters were using Romanian 
frontmen and companies. In October 2018, the three 
bodies organised a joint operation in which they 
searched the homes and offices of several individuals 

30

The OLAF report 2018Figure 10: Carousel fraud to evade paying VAT

Criminal group runs carousel fraud 
scheme worth €30 million
OLAF and the Italian Guardia di Finanza (GdF) 
discover a complex, transnational fraud scheme.
Fraudsters evade VAT duties on the sale of 
high-value electronic devices in Italy.
They use shell companies 
throughout Europe and 
foreign bank accounts to 
hide their identity.

What is 
Carousel Fraud
Trade facilitation regimes 
allow for VAT to be paid in the Member 
State the goods are destined for.
This can be abused by fraudsters who avoid 
paying duties altogether.
Criminals come up with complex carousel 
schemes, whereby the same goods are bought and 
resold several times via middlemem.
Each time, the amount of tax owed increases  but 
the company either disapperars or becomes 
insolvent before the tax authority can collect the 
accumulated VAT.

OLAF supports communications 
between Italy and Romanian partners
The fraudsters were using Romanian 
frontmen and companies.
OLAF alerts Romanian authorities from the 
National Anti-corruption Directorate (DNA).

OLAF, GdF and DNA plan 

joint operation.

OLAF and partners 
stop criminal operation
Investigators search homes and oﬃces 
of several individuals in Romania.
OLAF investigators participated in the 
operation on the ground.
Eight persons suspected of being part 
of the transnational organised group 
are detained and made available for 
judicial interrogation.

in Romania. Eight persons suspected of being part of 
a transnational organised criminal group have been 
interviewed by law enforcement officials.

A European Investigative Order was addressed 
by the Italian Prosecutor to the Romanian judicial 
authorities. Romanian magistrates consequently 
allowed Italian Guardia di Finanza officers to carry out 
joint searches in Romania, together with the DNA. 
OLAF investigators participated in the operation on 
the ground.

3.6. Further successes in string  
of undervaluation cases

For  the  past  several  years,  OLAF  has  been  fighting  a 
very  particular  type  of  fraud  -  the  undervaluation  of 
textiles and footwear entering the European Union and 
going  through  customs  clearance  in  several  Member 
States, such as the United Kingdom, Slovakia, Czechia 
and Greece. While several EU customs procedures allow 

importers to clear their goods at the customs point of 
their choice, rather than at the point of entry into the 
customs territory, organised criminal networks are apt 
at  identifying  those  entry  points  where  they  perceive 
the controls to be more lax. 

This was clearly evident throughout 2017 and 2018 with 
a substantial increase in the volume of such goods being 
brought into countries like Greece and Hungary, and a 
corresponding decrease in the volumes that were being 
declared  for  import  into  the  Member  States  that  had 
been  previously  targeted,  but  where  authorities  had 
taken  action.  OLAF’s  investigation  uncovered  a  direct 
correlation between implementing risk profiles, which 
prompt customs officers to deal with the risk indicated, 
such  as  to  physically  examine  a  container  or  to  check 
the customs declaration and accompanying documents, 
and diminishing traffic.

The latest in these undervaluation cases was concluded 
concerning the fraudulent import of textiles and shoes 
into  Greece  between  1  January  2015  and  31  May  2018. 

31

The OLAF report 2018OLAF  carried  out  an  extensive  analysis  of  all  customs 
declarations  presented  in  Greece  for  all  imports  of 
textiles and shoes from China between 2015 and 2018. 
As a result, OLAF found that there was organised and 
systematic fraudulent undervaluation of these products 
at import in the period concerned in Greece.

its  findings,  OLAF 

Based  on 
issued  a  financial 
recommendation to Greek customs to recover the sum 
of EUR 202.3 million in lost customs duties. In concluding 
the case, OLAF also sent a judicial recommendation to 
the  Office  of  the  Public  Prosecutor  against  Financial 
Crimes in Greece asking it to take OLAF’s findings into 
account  in  its  ongoing  separate  judicial  investigations 
into  particular  cases  of  such  fraudulent  imports  into 
Greece.

The  closure  of  this  case  brings  the  total  number  of 
undervaluation cases  that OLAF has concluded  in  the 
past  two  years  to  six.  In  these  six  cases  combined, 
OLAF  has  made  financial  recommendations  totalling 
over  EUR  2.5  billion  amounting  to  the  customs  duties 

denied  to  the  EU  budget.  The  associated  estimated 
financial losses in VAT payments, which would be due 
to national budgets and part of which would also be due 
to the EU budget, are of an even greater amount.

This  string  of  cases  uncovered  by  OLAF  shows  that 
organised  networks  of  fraudsters  are  targeting  the 
EU  as  a  whole  by  selecting  those  entry  points  where 
they  perceive  the  entry  to  be  easier  at  one  particular 
time. Both the Member States and the EU as a whole 
are victims of this organised crime. There is a clear need 
for  more  cooperation  between  customs  offices  in  the 
Member  States  in  order  to  deal  in  a  coordinated  way 
with these criminal networks.

OLAF continues to work closely with the various services 
of all Member States affected by this irregular trade. Such 
work  comprises  ongoing  investigations,  early  warnings 
and  alerts  to  Member  States  in  relation  to  surges  in 
suspicious  trade  flows,  precautionary  measures  to  be 
taken  by  Member  States  and  other  actions  designed  to 
combat this large-scale organised fraud.

32

The OLAF report 20184. OLAF on the European  
and international scene

4.1. OLAF relations  
with its partners

from  an 

Both 
investigative  and  policy-making 
perspective, the work carried out by OLAF can only lead 
to tangible results on the ground if the Office succeeds 
in joining forces with other European and international 
institutions to engage in the global fight against fraud 
and  corruption.  In  2018,  OLAF  continued  to  develop 
existing  partnerships  and  to  enter  into  arrangements 
with new partners worldwide.

A. ADMINISTRATIVE COOPERATION 
ARRANGEMENTS AND INTERNATIONAL 
EVENTS WITH KEY PARTNERS

Administrative  Cooperation  Arrangements  (ACAs)  are 
instrumental in helping OLAF to foster close relations 
with  investigative  bodies  and  other  non-investigative 
partners  engaged  in  the  fight  against  fraud.  In  2018, 
OLAF concluded two ACAs with international partners, 
namely the African Development Bank and the Office 
of  the  Inspector  General  of  the  U.S.  Agency  for 
International Development (USAID). 

OLAF  stepped  up  its  international  engagement  by 
organising  several  events  with  partner  authorities, 
such  as  the  Anti-Fraud  Coordination  Service  (AFCOS) 
seminar  in  the  Western  Balkans,  and  the  anti-fraud 
workshop with competent Ukrainian authorities. 

In addition, OLAF participated in numerous international 
events, such as the annual conference of the European 
Partners against Corruption/European Anti-Corruption 
Contact-point  Network  (EPAC/EACN),  the  Forum 
of  General  Inspections  of  African  States  (FIGE),  the 
Conference  of  International  Investigators  (CII)  and  in 
the meeting of the Syria Investigations Working Group, 
which comprises national and international authorities 
providing humanitarian assistance to Syria.

B. ADVISORY COMMITTEE FOR 
COORDINATION OF FRAUD PREVENTION 
(COCOLAF)

OLAF  steers  and  chairs  the  Advisory  Committee  for 
the  Coordination  of  Fraud  Prevention  (COCOLAF), 
composed  of  representatives  of  Member  States’ 
authorities.  The  2018  annual  COCOLAF  meeting 
provided  an  opportunity  to  exchange  views  on  the 
main  developments  in  the  fight  against  fraud  and  the 
preparation  of  the  Article  325  TFEU  Report  on  the 
“Protection of the European Union’s financial interests 
— Fight against fraud 2017”.

In 2018, the specific COCOLAF subgroups worked on:

  discussing OLAF cooperation with AFCOS, both 

from an investigative and from a policy perspective;
  exchanging best practice and developing a common 

framework for fraud prevention and detection;
  sharing the results of analyses about main fraud 

and irregularity trends and patterns and working on 
developing a “Methodology for country profiles in 
the anti-fraud area”;

  sharing media strategies and organising 

communication activities on fraud prevention and 
deterrence.

C. MUTUAL ASSISTANCE  
AND ANTI-FRAUD CLAUSES  
IN INTERNATIONAL AGREEMENTS

Cooperation  with  third  countries  with  a  view  to 
preventing,  detecting  and  combating  breaches  of 
customs legislation is based on agreements on mutual 
administrative  assistance  in  customs  matters.  Such 
agreements  provide  the  required  legal  basis  in  the 
context  of  Article  19  of  Regulation  515/97  for  the 
exchange of information with third countries on fraud 
or  irregularities.  Agreements  with  more  than  80  third 
countries  are  currently  in  place,  including  with  major 
EU trade partners, like the US, China or Japan. In 2018, 
the  agreement  with  New  Zealand  entered  into  force. 
In  addition,  negotiations  have  been  finalised  with 
Mercosur  (Argentina,  Brazil,  Paraguay  and  Uruguay) 

33

The OLAF report 2018OLAF Director-General Ville Itälä chairing AFCOS 2018 meeting

and  Chile,  and  are  ongoing  with  Australia,  Indonesia, 
Uzbekistan and Kyrgyzstan.

These  free  trade  agreements  usually  contain  an  anti-
fraud  clause  which  allows  for  a  temporary  withdrawal 
of  tariff  preference  for  a  product  in  cases  of  serious 
customs  fraud  and  a  persistent  lack  of  adequate 
cooperation  to  combat  it.  OLAF  represents  the  EU  in 
negotiations of the clause. In 2018, negotiations on the 
clause were completed with Mexico and Mercosur, and 
good progress was made in ongoing negotiations with 
Australia,  Chile  and  Tunisia.  Discussions  with  Andorra 
on  strengthening  its  tobacco  control  framework  also 
moved forward.

Since February 2017, Article 12 of WTO Trade facilitation 
Agreement  (Bali  Agreement)  has  provided  for  an 
additional  possibility  to  exchange  information  with 
third countries with the purpose of verifying an import 
or  export  declaration  where  there  are  reasonable 
grounds  to  doubt  the  truth  or  accuracy  of  the 
declaration.  At  the  end  of  2018,  the  WTO  Agreement 
counted 139 members. OLAF is monitoring progress in 
implementing this article. 

4.2. The Hercule III Programme:  
a key tool in supporting  
the fight against fraud  
across the EU

OLAF  is  responsible  for  the  management  of  the 
Hercule  III  Programme  which  supports  actions  and 
projects  that  aim  to  protect  the  financial  interests  of 
the EU. The Programme has a budget of over EUR 100 
million for the period 2014-2020. It is implemented on 
the  basis  of  annual  work  programmes  setting  out  the 
budget and the funding priorities for a given calendar 
year.  The  annual  work  programme  for  2018  made  a 
budget of EUR 15.35 million available for the purchase 
of,  for  example,  specialised  technical  equipment  by 
law  enforcement  agencies  in  the  Member  States, 
such  as  customs  or  police  forces.  The  financial 
support was used for the purchase of a wide range of 
technical  equipment,  like  scanners  used  in  harbours 
or  airports,  digital  forensic  software  and  hardware, 
or  for  the  purchase  and  training  of  sniffer  dogs.  The 
law  enforcement  authorities  were  also  assisted  in 
their  operations  and  investigations  through  procured 

34

The OLAF report 2018access  to  commercial  databases.  The  Programme  also 
supported  conferences,  seminars  and  training  events 
attended  by  staff  of  national  administrations,  law 
enforcement agencies and NGOs in order to strengthen 
mutual  cooperation  or  the  exchange  of  best  practice. 
The  Programme  also  funded  two  sessions  of  digital 
forensics and analysis training aimed at improving the 
skills of anti-fraud professionals in collecting, securing 
and analysing evidence from digital devices.

Vehicle scanner purchased by Finnish customs through the 
Hercule Programme managed by OLAF

35

The OLAF report 20185. Monitoring the actions taken by the 

recipients of OLAF recommendations 

5.1.  Financial monitoring

OLAF INVESTIGATIONS LEAD TO 
SIGNIFICANT FINANCIAL RECOVERIES

Financial recommendations are addressed by OLAF to 
the  EU  institutions  or  national  authorities  providing 
or  managing  EU  funds.  The  aim  of  such  financial 
recommendations is to seek the recovery of defrauded 
EU funds to the EU budget. The sum recommended by 
OLAF for recovery each year depends on the scope and 
scale of the investigations concluded in that given year. 
The  amount  of  recommended  recoveries  is  therefore 
not  an  indication  of  the  overall  fraud  level  in  Europe, 
but relates to specific investigations OLAF has finalised 
in a particular year.

As  a  result  of  the  investigations  it  concluded  in  2018, 
OLAF  has  recommended  the  recovery  of  EUR  371 
million to the EU budget. 

It  is  worth  highlighting  that  OLAF  is  not  itself 
responsible  for  the  recovery  of  these  funds.  Relevant 
authorities at EU and Member State level can retrieve 
this money from the beneficiaries of the funds, national 
managing authorities or paying agencies in a number of 
ways,  including  direct  recovery,  offsetting,  deduction, 
de-commitment,  programme  closure  or  clearance  of 
accounts.

FINANCIAL IMPACT OF OLAF’S 
INVESTIGATIONS IN THE OVERALL 
DETECTION OF IRREGULARITIES ACROSS 
EU

Member States are responsible for most of EU spending 
and they also manage the collection of the EU’s customs 
revenue.  Their  activities  represent  the  first  line  of 
defence against any attempt to defraud the EU budget. 
OLAF  counts  on  national  authorities  to  perform  their 
work  efficiently  and  diligently,  and  supports  them 
through  an  active  exchange  of  information  and  via 
targeted trainings. 

Under  sectoral  regulations,  Member  States  have  to 
report any irregularity or suspicion of fraud1 they detect 
exceeding EUR 10 000 to the European Commission. An 
analysis of these data is compiled in the Commission’s 
Annual  Report  on  the  protection  of  the  EU  financial 
interests (the so-called “PIF Report”).

In  parallel  with  data  concerning  Member  States’ 
detections, OLAF also gathers data on the number of 
investigations  it  has  concluded  and  which  have  led  to 
financial recommendations.

In recent annual Reports, OLAF presented a comparative 
analysis in the areas of Traditional Own Resources (TOR) 
and shared management, providing an overview of the 
number of fraudulent and non-fraudulent irregularities 
detected  by  national  authorities,  compared  to  the 
financial  recommendations  issued  by  OLAF  in  the 
same  areas.  In  this  year’s  Report,  the  analysis  covers 

Figure 11: Amounts recommended by OLAF for financial recovery in 2018 (in million euros)

Amounts recommended

2012

284

2013

403

2014

901

2015

888

2016

631

2017

3 095

2018

371

(1)   A case can be defined as fraud only after a definitive sentence 
is issued by a competent judicial authority. This can take a few 
years following the detection and reporting of the case to the 
Commission.

36

The OLAF report 2018a  period  of  five  years,  from  2014  to  2018.  The  impact 
of  investigations  is  shown  as  a  percentage  of  the 
total  Traditional  Own  Resources  that  authorities  have 
collected for the years 2014-2018 and as a percentage 
of the total payments made under the two main areas 
of  shared  management  by  each  Member  State.  The 
results  obtained  by  OLAF  during  the  same  period  are 
presented next to those of national authorities2.

For  the  purpose  of  our  analysis,  it  is  assumed  that 
financial  recommendations  issued  by  OLAF  following 
investigations are comparable to the financial impact of 
irregularities detected and reported by Member States.

Figure  12  shows  the  number  of  irregularities/fraud 
cases detected in the area of Traditional Own Resources 
between 2014 and 2018 and the percentage that their 
financial impact represents in terms of the gross TOR 
collected by Member States and made available to the 
EU budget. OLAF results are shown alongside those of 
national authorities. 

Figure  13  shows  the  number  of  fraudulent  and  non-
fraudulent  irregularities  detected  in  the  two  main 
areas of shared management, European Structural and 
Investment Funds and Agriculture, from 2014-2018 and 
their  financial  impact  expressed  as  a  percentage  of 
the total payments for the years 2013-2017, divided by 
Member State. OLAF results are shown alongside those 
of national authorities.

Our  analysis  highlights  once  again  the  important 
contribution  that  OLAF  investigations  are  making  in 
helping  the  relevant  authorities  recover  EU  revenue 
and  funds  that  have  been  defrauded  or  irregularly 
spent.  In  terms  of  Traditional  Own  Resources,  OLAF 
financial  recommendations  would  represent  2.67% 
of  the  gross  TOR  collected,  compared  to  2.05%  for 
all  Member  States  together.  This  means  that,  for  this 
period,  OLAF  financial  recommendations  exceed  the 
entire financial impact of the investigative and control 
activities of the Member States. The OLAF results are 
significantly influenced by the conclusion of a string of 
investigations linked to the undervaluation of imported 
goods. These results also highlight OLAF’s commitment 
to utilising resources effectively and concentrating on 
cases where its input would bring most added value. 

in  the  shared 
OLAF  results  are  also  significant 
management  areas,  where  the  financial  impact  of  the 
activities  of  all  Member  States  together  accounts  for 
2.01%  of  payments,  while  OLAF  alone  recommended 
the  recovery  of  0.45%  of  payments.  In  this  area, 
OLAF  financial  recommendations  would  represent 
18%-22%3  of  the  entire  impact  of  investigative  and 
control activities. There are particular countries where 
the  financial  impact  of  OLAF  cases  is  particularly 
significant  and,  at  times,  even  higher  than  that  of 
national investigations. 

(2)   Results by the Member States and OLAF may partially 

overlap. OLAF results are extracted from the OLAF Case 
Management System, and represent the total sum of financial 
recommendations issued at the end of the investigations. Data 
concerning Member States is extracted from the Irregularity 
Management System (IMS) for the two expenditure areas and 
from the OWNRES system for TOR. Data used in this report 
needs to be considered as provisional. Final data is published in 
the “Report from the Commission to the European Parliament 
and the Council on the Protection of the European Union’s 
financial interests — Fight against fraud” which will be 
published in September 2019.

(3)   The range has been calculated assuming, for the lower limit, 
that OLAF results are not included in those reported by the 
Member States, while for the highest limit, the assumption 
is the opposite - that OLAF results are fully included in those 
reported by the Member States.

37

The OLAF report 2018Figure 12:  Member State/OLAF detection of irregularities and their financial impact in the area of 

Traditional Own Resources for the period 2014-2018

Member State

Member States

OLAF

Traditional Own Resources (TOR) 2014-2018

Detected fraudulent 
and non-fraudulent 
irregularities

Financial impact as 
% of TOR collected

Investigations 
closed with 
recommendations

Financial 
recommendations as 
% TOR collected

Austria

Belgium

Bulgaria

Croatia

Cyprus

Czechia

Denmark

Estonia

Finland

France

Germany

Greece

Hungary

Ireland

Italy

Latvia

Lithuania

Luxembourg

Malta

Netherlands

Poland

Portugal

Romania

Slovakia

Slovenia

Spain

Sweden

United Kingdom

Total

N

320

1 092

94

72

32

420

353

40

176

1 733

9 279

224

167

166

668

118

224

0

13

2 331

756

172

282

85

57

1 614

587

4 624

25 699

%

2.69%

0.95%

0.78%

1.63%

0.63%

2.25%

1.60%

1.59%

1.24%

2.45%

2.17%

6.84%

1.56%

1.25%

1.05%

4.40%

2.54%

0.00%

3.68%

3.34%

0.91%

3.23%

2.78%

0.78%

0.76%

2.22%

0.93%

2.18%

2.05%

N

8

28

15

5

10

17

15

5

7

23

36

18

12

5

33

9

13

0

3

45

21

18

26

9

11

34

14

40

480

%

0.23%

0.58%

1.08%

0.12%

0.45%

1.34%

0.49%

0.12%

0.11%

0.34%

0.23%

22.13%

0.14%

0.06%

0.20%

1.40%

0.94%

0.00%

1.24%

1.80%

0.45%

0.87%

1.09%

50.11%

0.33%

0.79%

0.29%

10.96%

2.67%

38

The OLAF report 2018Figure 13:  Member State/OLAF detection of irregularities and their financial impact in the areas of 

European Structural and Investment Funds and Agriculture for the period 2014-2018

Shared Management: Cohesion and Natural Resources 2014-2018

Member State

Member States

OLAF

Detected fraudulent 
and non-fraudulent 
irregularities

Financial impact as 
% of payments

Investigations 
closed with 
recommendations

Financial 
recommendations as 
% of payments

Austria

Belgium

Bulgaria

Croatia

Cyprus

Czechia

Denmark

Estonia

Finland

France

Germany

Greece

Hungary

Ireland

Italy

Latvia

Lithuania

Luxembourg

Malta

Netherlands

Poland

Portugal

Romania

Slovakia

Slovenia

Spain

Sweden

United Kingdom

Total

N

370

315

1 072

189

82

2 665

144

412

155

1 291

1 567

2 206

2 886

1 120

4 117

517

1 110

2

91

777

5 103

2 723

5 563

1 649

261

10 995

175

2 596

50 153

%

0.37%

0.46%

1.92%

0.95%

0.74%

2.86%

0.27%

1.58%

0.12%

0.30%

0.31%

2.50%

1.31%

1.88%

1.33%

2.36%

2.05%

0.02%

2.53%

0.79%

1.89%

2.04%

3.23%

19.29%

1.59%

3.31%

0.20%

0.57%

2.01%

N

2

1

27

2

0 

7

 0

0 

 0

10

4

17

52

 0

21

1

3

 0

 0

4

22

10

66

14

1

7

 0

6

277

%

0.02%

0.02%

0.42%

0.34%

0.00%

0.06%

0.00%

0.00%

0.00%

0.01%

0.37%

0.31%

3.84%

0.00%

0.35%

0.01%

0.11%

0.00%

0.00%

0.04%

0.12%

0.42%

0.40%

2.29%

0.14%

0.43%

0.00%

0.05%

0.45%

39

The OLAF report 20185.2. Judicial monitoring

Judicial  monitoring  allows  OLAF  to  see  the  final 
outcome  of  its  cases,  be  it  indictments,  dismissals  or 
other judicial measures, if any. 

authorities  to  use  OLAF  reports  as  evidence  in  trial. 
Therefore, in numerous Member States, after receiving 
the  OLAF  final  report,  prosecutors  carry  out  all  the 
investigation  activities  once  again  in  order  to  acquire 
admissible evidence. 

According to Article 11 of Regulation No. 883/20134, at 
the request of the Office, the national judicial authorities 
concerned must send OLAF information on the action 
taken on the basis of its judicial recommendations.   

Sometimes,  despite  considerable  investigative  efforts 
deployed by the Office, its limited investigation powers 
and  practical  possibilities  do  not  allow  to  collect 
conclusive evidence of a criminal offence.

As  regards  internal  investigations,  whereas  for  OLAF 
any infringement committed by EU staff is regarded as 
a  very  serious  matter,  irrespective  of  the  prejudice  to 
the EU budget, the priorities of the national judiciaries 
may be different.

are 

there 

sometimes  differences  of 
Finally, 
interpretation  of  EU  and  national  law  between  OLAF 
and  national  authorities.  In  2016,  OLAF  started  to 
address  these  differences,  through  bilateral  meetings 
judicial  authorities.  This  work 
with  the  relevant 
continues  to  date.  OLAF  liaises  with  Member  States 
on  an  ongoing  basis  in  order  to  improve  follow-up  at 
national level.

Based  on  the  monitoring  carried  out  in  2018,  OLAF 
noted  that  around  36%  of  the  cases  it  submitted  to 
national judicial authorities have led to indictments. 

While  judicial  authorities  are  independent  and  while 
the legal architecture may vary at Member State level, 
OLAF  has  worked  on  understanding  the  reasons  why 
national judiciaries dismissed some of the cases OLAF 
had submitted. 

While  it  is  not  for  OLAF  to  question  the  validity  of 
national  prosecutors’  decisions  to  dismiss  individual 
cases  on  particular  grounds,  it  appears  that  article  11 
paragraph 2 of Regulation 883/2013 is not a sufficient 
judicial 
legal  basis  to  allow  all  Member  States’ 

(4)  Regulation (EU, Euratom) No. 883/2013 of the European 

Parliament and of the Council of 11 September 2013 concerning 
investigations conducted by the European Anti-Fraud Office 
(OLAF) and repealing Regulation (EC) No. 1073/1999 of 
the European Parliament and of the Council and Council 
Regulation 

40

The OLAF report 2018Figure 14:  Actions taken by national judicial authorities (JA) following OLAF’s recommendations issued 

between 1 January 2012 and 31 December 2018

Member state

No decision 
taken by JA* 
so far

Decision taken by JA

Indictment rate

Total

Dismissed

Indictment

Austria

Belgium

Bulgaria

Croatia

Cyprus

Czechia

Denmark

Estonia

Finland

France

Germany

Greece

Hungary

Ireland

Italy

Latvia

Lithuania

Luxembourg

Malta

Netherlands

Poland

Portugal

Romania

Slovakia

Slovenia

Spain

Sweden

United Kingdom

Grand Total

2

11

9

4

3

4

1

0

1

11

14

16

20

1

21

1

2

5

1

5

14

6

20

5

3

10

0

19

4

20

13

1

2

7

3

2

3

4

19

10

20

2

23

4

6

7

5

13

9

8

84

12

1

17

3

16

209

318

3

11

12

1

2

6

2

1

3

3

15

2

11

2

12

3

2

4

0

8

2

5

59

9

0

11

2

12

203

1

9

1

0

0

1

1

1

0

1

4

8

9

0

11

1

4

3

5

5

7

3

25

3

1

6

1

4

115

25%

45%

8%

0%

0%

14%

33%

50%

0%

25%

21%

80%

45%

0%

48%

25%

67%

43%

100%

38%

78%

38%

30%

25%

100%

35%

33%

25%

36%

* 

In the category of no decision taken, we include also those cases that are still in the so-called “reporting period”. When OLAF 
sends a judicial recommendation to a Member State, the competent authority has to report on the actions taken following the 
recommendation within 12 months.

41

The OLAF report 20185.3. Disciplinary monitoring

EU INSTITUTIONS TAKE ACTION  
TO FOLLOW UP ON OLAF’S INTERNAL 
INVESTIGATIONS

The  disciplinary  recommendations  issued  by  OLAF 
concern  serious  misconduct  of  EU  staff  or  members 
of the EU institutions and are directed to the authority 

having disciplinary powers in the institution concerned. 
When  making  such  recommendations,  OLAF  does 
not  specify  the  type  of  action  that  should  be  taken. 
The  appointing  authorities  sometimes  take  several 
actions following a single recommendation from OLAF. 
At  the  same  time,  the  appointing  authority  may  join 
several  recommendations  resulting  from  different 
investigations  and,  subsequently,  impose  one  single 
sanction. 

Figure 15:  Actions taken by the appointing authorities following OLAF’s disciplinary recommendations 

issued between 1 January 2016 and 31 December 2018

Recipient of recommendation

Total

No decision 
taken so far

Decision taken

No case is made Action taken

Agencies

Committee of the Regions

Council of the European Union

EEAS - European External Action Service

EULEX Kosovo

European Commission

European Court of Auditors

European Court of Justice

European Economic and Social 
Committee

European External Action Service

European Investment Bank 

European Parliament

Total

9

1

1

1

1

18

2

2

1

2

1

7

46

0

1

0

1

0

6

0

1

0

0

0

4

4

0

0

0

1

5

0

1

1

0

0

0

5

0

1

0

0

7

2

0

0

2

1

3

13

12

21

42

The OLAF report 20186. Policies to fight fraud

In  addition  to  its  investigative  work,  OLAF  plays  an 
active role in the development of the anti-fraud policies 
of  the  European  Union.  The  Office  is  regularly  at  the 
forefront  of  drafting  and  negotiating  legislative  texts 
concerning the protection of the EU’s financial interests 
against  fraud  and  corruption.  It  is  thanks  to  its  solid 
investigative  expertise  that  OLAF  can  support  the  EU 
institutions  in  furthering  a  sound  legal  framework  to 
protect the EU budget and taxpayers’ money. 

6.1.  Improving fraud prevention and 

detection at EU level:  
the new Commission  
Anti-Fraud Strategy of 2019

The  Commission’s  Corporate  Governance  Package5  of 
21 November 2018 highlighted the need to improve the 
EU institutions’ knowledge of the main causes of fraud, 
as well as of the newest trends in this domain. It called 
for  strengthening  the  corporate  oversight  of  the  fight 
against fraud in the Commission services. 

From a longer-term perspective, the fight against fraud 
needs  to  meet  emerging  challenges  under  the  coming 
multiannual financial framework (MFF) 2021–2027. This 
will  require  a  new,  enhanced  approach  to  preventing, 
detecting and investigating fraud at EU level.

This  is  why,  throughout  2018,  OLAF  worked  with 
Commission  Directorates-General 
executive 
agencies  on  a  revision  of  the  Commission’s  Anti-Fraud 
Strategy. The new Strategy was adopted in April 2019.

and 

The  new  Commission  Anti-Fraud  Strategy  (CAFS)  is 
based  on  an  evaluation  of  the  prior  Strategy  in  place 
since  2011,  as  well  as  on  a  fraud  risk  assessment  that 
was carried out by OLAF with the active involvement of 
Commission departments and Executive agencies. Such 
departments and agencies are responsible for their own 
internal  control  systems  and  are  thus  in  the  frontline 

of  the  fight  against  fraud.  The  evaluation  highlighted 
in particular the need to adapt to an evolving situation 
(new funding schemes, new fraud trends, development 
of IT tools, etc.). The 2019 CAFS also takes into account 
recommendations  made  by  the  European  Court  of 
Auditors in its Special Report 01/2019 “Fighting fraud in 
EU  spending:  action  needed”  (published  on  10  January 
2019)6.

The  two  priority  axes  of  the  2019  CAFS  aim  at 
strengthening  the  Commission’s  capabilities  in  the 
strategic  analysis  of  fraud  data  and  OLAF’s  role  in 
coordinating  fraud  risk  management  by  Commission 
services and executive agencies.

Coherence  between 
the  anti-fraud  strategies  of 
Commission Directorates-General will be ensured in the 
future through mandatory quality control by OLAF. As a 
new task, OLAF will also monitor the implementation of 
anti-fraud strategies at service level.

Reliable, complete and accurate data and their analysis 
form  the  basis  of  well-grounded  policy-making.  OLAF 
already  collects  and  analyses  data  on  fraud  and  other 
irregularities,  notably  in  the  customs  area  and  in  the 
domain  of  shared  management,  where  Member  States 
spend  EU  funds  according  to  EU  rules.  However,  the 
quality  of  these  data  needs  to  improve  further  and 
the  analysis  of  fraud  risks  based  on  these  data  should 
become more comprehensive, in order to contribute to a 
more efficient deployment of anti-fraud controls. 

Ultimately,  this  strengthened  analysis  aims  to  improve 
prevention,  detection  and  investigation,  for  example 
through  better  data  on  fraud  patterns  and  systemic 
vulnerabilities,  which  can  be  acted  upon  through 
developing  risk  indicators  tailored  to  specific  sectors 
or  regions  and  widening  knowledge  about  fraudulent 
activities in general.

All  Commission  services  and  Executive  agencies  will 
contribute  to  the  implementation  of  the  new  CAFS 
2019, which will be coordinated by OLAF.

(5)  Communication to the Commission on Streamlining and 
strengthening corporate governance within the European 
Commission (C(2018) 7704 final) and Communication to the 
Commission on Governance in the European Commission 
(C(2018) 7703 final).

(6)  https://www.eca.europa.eu/en/Pages/DocItem.aspx?did=48858

43

The OLAF report 2018Figure 16:  Enhancing data collection and analysis

Commission 
audits and 
databases

OLAF  
investigations

Improved 
Irregularity 
Management 
System

Other info 
provided by 
EU bodies 
and MS

Public and 
commercial 
databases

Scientific 
studies

Data collection

Intelligence 
scanning

Quality check

ANALYSIS

Better understanding of fraud risks

Fraud 
patterns

Risk 
indicators

Systemic 
vulnerabilities

Country 
profiles

44

The OLAF report 20186.2. Revision of the  

OLAF Regulation  
(EU, Euratom No. 883/2013) 7

The  Regulation  concerning  investigations  conducted 
by  the  European  Anti-Fraud  Office  (“the  OLAF 
Regulation”)8  is  the  main  legal  instrument  governing 
OLAF’s  investigative  activities.  In  May  2018,  the 
Commission  adopted  a  proposal  to  amend  it.  Against 
the  backdrop  of  the  creation  of  the  European  Public 
Prosecutor’s  Office  (EPPO),  the  proposal  seeks  to 
ensure that OLAF is equipped to work closely with the 
EPPO to detect and investigate fraud across the EU and 
to  ensure  strong  complementarity  between  criminal 
and administrative action at Union level. The proposed 
changes are also intended to clarify OLAF’s tools for the 
conduct of administrative investigations with a view to 
ensuring their effectiveness, responding to the findings 
of  the  evaluation  of  the  OLAF  Regulation,  which  was 
concluded in October 20179.

For  the  future  OLAF-EPPO  relationship,  the  proposal 
sets  the  framework  for  a  close  and  complementary 
cooperation,  so  that  all  available  means  are  used  to 
protect the Union budget. While the EPPO will conduct 
criminal investigations, OLAF will continue conducting 
administrative  investigations  which  –  in  the  Member 
States participating in the EPPO – will have a particular 
emphasis  on  facilitating  recovery  and  preventing 
further  harm  to  EU  finances  through  administrative 
measures. 

The  proposal  also  contains  a  number  of  targeted 
changes  to  enhance  the  effectiveness  of  OLAF 
investigations.  These  are  essential  changes  necessary 
to strengthen the framework for OLAF investigations, 
in order to maintain a strong and fully functioning OLAF 
that  complements  the  EPPO’s  criminal  law  approach 
with administrative investigations. The focus is on areas 
where,  today,  the  lack  of  clarity  of  certain  provisions 
in  the  current  OLAF  Regulation  results  in  obstacles 
which hinder OLAF’s effective operations. This regards, 

(7)  COM (2018) 338 final - 2018/0170/COD

(8)  Regulation (EU, Euratom) No. 883/2013 of the European 

Parliament and of the Council of 11 September 2013 concerning 
investigations conducted by the European Anti-Fraud Office 
(OLAF) and repealing Regulation (EC) No. 1073/1999 of the 
European Parliament and of the Council and Council Regulation 
(Euratom) No. 1074/1999, OJ L 248, 18.9.2013, p. 1–22.

(9)  Commission Report on the Evaluation of the application of 

notably  on-the-spot-checks  and  inspections,  access 
to  bank  account  information,  as  well  as  VAT  fraud 
and the admissibility of OLAF-collected evidence. The 
amendments  aim  to  clarify  OLAF’s  legal  framework 
and would allow it to operate in an effective and more 
coherent manner in all its investigations.

To  ensure  both  a  seamless  transition  to  the  new 
institutional  framework  and  an  effective  cooperation 
between OLAF and the EPPO, the amended regulation 
should  be  in  force  by  the  time  the  EPPO  becomes 
operational10.  The 
legislative  negotiations  on  the 
proposal  with  the  co-legislators  started  in  2018  with 
a  detailed  analysis  of  the  European  Commission’s 
proposal  in  the  Council  working  party  for  combatting 
fraud.

6.3. The European Public Prosecutor’s 

Office

Over  a  year  has  passed  since  the  publication  of  the 
Regulation  on  the  creation  of  the  European  Public 
Prosecutor’s  Office  (EPPO)11.  The  establishment  of  a 
strong,  efficient  and  independent  EPPO  represents  a 
priority for the Commission and particularly for OLAF, 
as co-responsible Commission service. The creation of 
the EPPO marks a fundamental development in the fight 
against  fraud  affecting  the  European  Union’s  budget, 
and it constitutes a crucial step towards the creation of 
a common criminal justice area in the European Union.

With the establishment of the EPPO by the end of 2020 
drawing closer, many crucial developments have taken 
place in 2018: the interim Administrative Director was 
appointed, the vacancy notice for the selection of the 
European Chief Prosecutor was published in November 
2018 and the recruitment procedure is ongoing, as well 
as the selection process for the European prosecutors in 
the Member States. Additionally, the Netherlands and 
Malta have officially joined the EPPO under enhanced 
cooperation,  which  makes  a  total  of  22  participating 
Member States.

(10)  This is currently envisaged for the end of 2020.

Regulation No. 883/2013, COM(2017)589 final.

(11)  Regulation (EU) 2017/1939

45

The OLAF report 2018will create flexibility from a budgetary and management 
point  of  view  and  improve  operational  synergies 
between  the  combined  activities.  It  should  allow  the 
Programme  to  better  adapt  to  new  and  unforeseen 
needs during the seven years of the next Multiannual 
Financial Framework.

6.6. Strengthening the EU’s policy  
on fighting illicit tobacco trade

OLAF not only works to fight illicit tobacco trade from 
an  operational  point  of  view,  but  contributes  to  the 
development of EU policies in this area. 

6.4. Horizontal provisions on the 
Protection of the Financial 
Interests of the Union 
(PIF provisions) within all  
MFF Commission Proposals 

In 2018, in close cooperation with spending and central 
Commission  services,  OLAF 
introduced  standard 
provisions on the protection of the financial interests of 
the European Union in all the Commission’s legislative 
proposals  for  the  post-2020  spending  programmes 
under  direct,  indirect  and  shared  management.  These 
provisions  reflect  requirements 
laid  down  in  the 
Financial  Regulation  and  recall,  inter  alia,  that  the 
financial  interests  of  the  Union  are  to  be  protected 
the 
through  proportionate  measures, 
prevention,  detection,  correction  and  investigation 
of fraud and other irregularities. Any person or entity 
receiving  Union  funds  is  obliged  to  fully  cooperate  in 
the  protection  of  the  Union’s  financial  interests,  to 
grant  the  necessary  access  rights  to  the  Commission, 
OLAF,  the  EPPO  and  the  European  Court  of  Auditors 
and  to  ensure  that  any  third  parties  involved  in  the 
implementation of Union funds grant equivalent rights.

including 

6.5. A new anti-fraud financial 

programme

In  May  2018,  the  Commission  adopted  a  proposal 
for  a  Regulation  establishing  a  new  EU  Anti-Fraud 
Programme,  destined  to  be  the  successor  of  the 
Hercule III Programme for the period 2021-2027. 

The  proposal  for  the  EU  Anti-Fraud  Programme  is  an 
ambitious project, combining the long-standing Hercule 
programme that has supported the fight against fraud 
since  2004  with  two  other  long-established  activities 
in  the  anti-fraud  area:  the  Anti-Fraud  Information 
System  (AFIS),  that  supports  Member  States  customs 
authorities in their mutual administrative assistance to 
prevent and detect customs fraud, and the Irregularity 
Management System (IMS) that provides an IT platform 
for the Member States to report detected irregularities 
to the detriment of the EU budget.

In other words, the new EU Anti-Fraud Programme will 
include funding for an improved Hercule III programme, 
as well as for AFIS and IMS. The proposed combination 

46

The OLAF report 2018On  23  March  2018,  OLAF  and  the  European  Economic 
and  Social  Committee  jointly  organised  a  conference 
in  Brussels  on  fighting  illicit  tobacco.  The  conference 
gathered  130  stakeholders  from  policy-makers  to  law 
enforcement  and  customs  services,  health  NGOs, 
consumer  organisations,  academics  and  industry.  It 
showed that the illicit tobacco trade is a major challenge 
to  society  in  general,  affecting  the  EU’s  tax,  health 
and  security  policies.  A  holistic  approach  is  needed  to 
effectively combat the illicit tobacco trade and this will 
arguably require measures targeting both the supply (e.g. 
by  strengthening  international  customs  cooperation) 
and demand side (e.g. by raising consumer awareness) of 
the illicit market. In this respect, the importance of the 
Protocol  to  Eliminate  Illicit  Trade  in  Tobacco  Products 
(FCTC  Protocol)  as  a  new  key  tool  to  fight  the  illicit 
tobacco trade at the global level was highlighted.

The first Meeting of  the  Parties  to  the  FCTC  Protocol 
to  Eliminate  Illicit  Trade  in  Tobacco  Products  was 
held  in  Geneva  in  October  2018.  This  was  an  historic 
event  marking  the  entry  into  force  of  the  Protocol  as 
a  dedicated  global  anti-smuggling  treaty.  The  event  is 
the culmination of years of EU engagement, with OLAF 
as  lead  service,  beginning  with  the  inception  of  the 
Protocol through its negotiation phase and ending with 
its entry into force on 25 September 2018.

The  EU  remains  committed  to  the  success  of  the 
FCTC  Protocol  and  will  actively  contribute  to  the 

work leading up to the second Meeting of the Parties 
in  2020,  focusing  on  securing  the  supply  chain  of 
tobacco  products  and  international  cooperation.  The 
EU will continue to promote ratification of the Protocol, 
especially  in  relevant  source  and  transit  countries  on 
major smuggling routes.

On 7 December 2018, the Commission also presented 
the  Second  Action  Plan  to  fight  the  illicit  tobacco 
trade.  The  Action  Plan  builds  further  on  the  Strategy 
presented in 201312 but also updates it in a number of 
aspects.  Covering  the  period  2018-2022,  the  Second 
Action plan proposes:

  To fully exploit the potential of the new FCTC 

Protocol as a global instrument and forum to curb 
the illicit tobacco trade, by taking a leading role in its 
implementation, following the entry into force of the 
Protocol on 25 September 2018;

  To engage key source and transit countries via the 

various frameworks for cooperation available to the 
EU, so as to limit the supply actually arriving at our 
borders;

  To focus on some of the key input materials going 
into the illicit manufacture of tobacco products, 
ranging from raw tobacco and cigarette filters to 
manufacturing and packing equipment; and 

  To raise awareness among consumers of the dangers 
of buying illicit tobacco products and the direct links 
to organised crime, as a means to reduce demand.

(12) COM/2013/0324 final

47

The OLAF report 20187.  Relations with the Supervisory Committee 

The Supervisory Committee of OLAF is a body of five 
independent  outside  experts,  established  to  reinforce 
and  guarantee  OLAF’s  independence  by  regularly 
monitoring the implementation of OLAF’s investigative 
function.  Its  members  are  appointed  by  common 
agreement of the European Parliament, the Council and 
the Commission.

The  current  Members  are:  Mr  Jan  Mulder  (Chairman), 
Mr Petr Klement, Ms Grażyna Stronikowska, Ms Helena 
Fazenda and Mr Rafael Muñoz. In line with Regulation 
No.  883/2013,  the  Members  are  supported  by  a 
Secretariat provided by the European Commission.  

The  Director-General  of  OLAF  keeps  the  Supervisory 
Committee  regularly  informed  about  the  activities  of 
the Office, the implementation of OLAF’s investigative 
function and the follow-up to investigations. 

In 2018, in accordance with Regulation 883/2013, OLAF 
made available to the Committee 486 documents with 
information  on  investigations  lasting  more  than  12 
months. OLAF also informed the Committee of judicial 
recommendations  transmitted  to  the  national  judicial 
authorities,  and  of  OLAF  cases  in  which  information 
was sent to national judicial authorities at the dismissal 

of the case. The Committee and its Secretariat had full 
access  to  64  case  files  in  OLAF’s  case  management 
system in 2018. 

On the basis of the information provided by OLAF, the 
Committee  delivers  Opinions  to  the  Director-General 
of  OLAF  and  reports  to  the  EU  institutions.  In  2018, 
the  Supervisory  Committee  delivered  its  Opinion 
1/2018, concerning the OLAF Preliminary Draft Budget 
for  2019,  and  provided  comments  to  the  European 
Parliament  and  the  Council  on  the  amendment  of 
Regulation 883/2013. 

In  its  Opinions,  the  Supervisory  Committee  issues 
recommendations  to  the  Director-General.  OLAF 
reports  annually  to  the  Committee  on  the  state  of 
implementation of these recommendations. In its 2018 
reporting,  OLAF  assessed  five  recommendations  out 
of ten as implemented, four as ongoing and one as not 
applicable.

Details  of  the  Committee’s  work  can  be  found  in 
its  annual  activity  report.  This  report  and  OLAF’s 
responses,  as  well  as  other  information,  are  publicly 
available on the OLAF website. 

48

The OLAF report 20188. Data protection, legality checks  

and complaints

The  protection  of  personal  data  has  always  been  a 
high  priority  for  OLAF.  Since  OLAF  was  set  up  as 
an  independent  investigative  body,  it  has  taken  all 
necessary measures to ensure effective implementation 
of the requirements of the applicable legal framework, 
including  recommendations  of  the  European  Data 
Protection  Supervisor  (EDPS).  The  decisions  and 
recommendations of the EDPS have a significant impact 
on  how  OLAF  carries  out  its  investigative  activities, 
such as on-the-spot checks or the forensic examination 
of digital media. OLAF appoints its own data protection 
officer (DPO) who provides advice and assists OLAF in 
applying high data protection standards. 

laying  down 

conducted  awareness-raising  activities  internally  and 
took  measures  to  efficiently  implement  the  new  data 
protection  rules.  In  this  context,  the  Commission 
adopted  a  Decision 
internal  rules 
concerning the processing of personal data by OLAF14. 
This initiative ensures compliance with the fundamental 
right to protect personal data as set out in Article 8 of 
the  Charter,  while  enabling  the  Office  to  secure  the 
confidentiality of its investigations as well as to ensure 
the  protection  of  the  rights  and  freedoms  of  persons 
concerned,  witnesses  and  informants.  The  Decision 
lays  out  the  conditions  under  which  OLAF  informs 
data  subjects  of  any  activity  involving  processing 

In December 2018, the new Data Protection Regulation 
for  EU  institutions  2018/172513  entered  into  force. 
OLAF  has  committed  to  lead  by  example.  OLAF 

(13)  OJ L 295, 21.11.2018, p. 39–98

(14)  Commission Decision (EU) 2018/1962 of 11 December 2018 
laying down internal rules concerning the processing of 
personal data by the European Anti-Fraud Office (OLAF) in 
relation to the provision of information to data subjects and 
the restriction of certain of their rights in accordance with 
Article 25 of Regulation (EU) 2018/1725 of the European 
Parliament and of the Council, OJ L 315, 12.12.2018, p. 41

49

The OLAF report 2018of  their  personal  data  and  handles  their  rights  of 
access,  rectification,  erasure,  restriction  of  processing 
and  communication  of  a  personal  data  breach.  The 
involvement of OLAF’s DPO (or, where applicable, the 
Commission DPO or the agency DPO) throughout the 
whole  procedure  ensures  an  independent  review  of 
the  applied  restrictions.  In  addition,  the  codification 
of OLAF’s established practices and procedures in the 
mentioned  Decision  ensures  a  high  degree  of  legal 
certainty to all data subjects, thus also complying with 
the  “quality  of  law”  requirements  developed  by  case 
law.

In  2018,  OLAF  maintained  its  commitment  to  ensure 
the  timely  provision  of  relevant  information  to  data 
subjects.  OLAF  received  and  handled  11  requests  for 
access  to  personal  data  as  well  as  two  requests  for 
erasure. They were all handled in a timely manner. There 
were no new complaints received from the EDPS during 
2018. An allegation reported of an alleged breach was 
not substantiated.

OLAF RECEIVES VERY LOW NUMBER  
OF COMPLAINTS ON ITS INVESTIGATIVE 
ACTIVITY

COMPLAINTS TO OLAF

Persons affected by an OLAF investigation may address 
a  complaint  directly  to  the  Director-General  of  OLAF. 
This is without prejudice to the citizens’ right to lodge 
a complaint with the European Ombudsman or to raise 
issues related to OLAF investigations before the EU or 
national courts. 

In 2018, the Director-General received five complaints 
from persons involved in different OLAF investigations 
about issues relating to the handling of their procedural 
guarantees.  They  have  been  followed  up  by  the 
competent services in the Office.

Officials and other EU staff may also complain to OLAF 
under Article 90a of the Staff Regulations against any 
act adversely affecting them in connection with OLAF 
investigations. In 2018, OLAF provided a substantiated 
reply  to  Article  90a  complaint  received  at  the  end  of 
2017.

EUROPEAN OMBUDSMAN

In  2018,  the  European  Ombudsman  opened  16 
new  inquiries  concerning  OLAF.  Two  of  the  new 
inquiries  concerned  procedural  guarantees  in  OLAF 
investigations.  One of them was closed in the course 
of  the  year  without  a  finding  of  maladministration.  In 
that same case, the Ombudsman also found that OLAF 
could  have  better  explained  why  it  had  taken  certain 
investigative  steps  rather  than  others  and  therefore 
made  two  suggestions  for  improvement  to  OLAF  in 
that regard.

Seven of the new inquiries concerned the lack of reply 
by  OLAF  to  citizens’  requests.    As  OLAF  eventually 
replied  to  these  requests,  the  Ombudsman  closed  six 
of  these  inquiries  in  the  course  of  the  year,  with  the 
conclusion that OLAF has settled the matter.

Five  other  new  inquiries  opened  in  2018  concerned 
requests  for  public  access  to  documents  based  on 
Regulation  No.  1049/200115.  The  Ombudsman  closed 
four of these inquiries in the course of the year, with the 
conclusion that OLAF did not act with maladministration 
when it refused to grant public access to the requested 
documents. In one of these cases, the Ombudsman also 
made two suggestions for improvement to OLAF about 
how to deal with such requests. 

Two  other  inquiries  opened  in  2018  concerned  the 
access to an investigation file by the person concerned, 
and  OLAF’s  decision  not  to  open  an  investigation 
respectively.  The  Ombudsman  completed 
these 
inquiries  with  the  conclusion  that  OLAF’s  refusal  to 
give  individual  access  to  its  investigation  file  to  a 
person concerned and OLAF’s decision not to open the 
investigation in question were justified.

In  2018,  the  Ombudsman  also  closed  four  inquiries 
opened in previous years. 

SIGNIFICANT CASE LAW  
BY THE EUROPEAN COURTS

Issues  related  to  OLAF 
investigations  were  also 
raised  before  the  European  Courts  in  a  very  limited 
number of cases. Usually, this occurs in the context of 
litigation  against  measures  taken  by  the  Commission 
or  other  institutions,  bodies  or  agencies  based  on 

(15)  OJ L 145, 31.5.2001, p. 43–48

50

The OLAF report 2018OLAF recommendations, such as financial recovery or 
disciplinary procedures. 

In the case of Sigma Orionis v Commission16, the Court 
clarified  which  law  applies  during  on-the-spot  checks 
and inspections by OLAF. 

The Court ruled that, in the absence of opposition by the 
economic operator, on-the-spot checks and inspections 
are conducted by OLAF on the basis of Regulation No. 
883/2013  and  Regulation  No.  2185/199617,  as  well  as 
based on written authorisation of the Director-General 
of OLAF. 

Union  law  supersedes  national  law  when  a  matter  is 
regulated by Regulations No. 883/2013 or No. 2185/1996. 

Moreover,  the  Court  found  that  the  provisions  in 
Regulation  No.  2185/1996  concerning  the  possible 
opposition  of  the  economic  operator  concerned  to  a 
check do not include the existence of a “right to oppose” 
but  simply  provide  that  the  check  may  be  imposed 
on  the  economic  operator  through  the  assistance  of 
national authorities and on the basis of national law.

With  regard  to  procedural  guarantees,  the  Court 
recalled that OLAF must respect fundamental rights as 
laid down in Union law, in particular in the Charter.

The  important  clarification  by  the  Court  of  law  that 
applies  during  on-the-spot  checks  helps  increase  the 
efficiency of OLAF investigations.

(16)  Judgment of the General Court of 3 May 2018 in case T-48/16, 

Sigma Orionis SA v European Commission.

(17) Council 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

European Court of Justice in Luxembourg

51

The OLAF report 20189. Staff and Budget 

INVESTING IN STAFF

In  the  context  of  the  general  reductions  in  staff  and 
budget  in  the  EU  public  service,  the  number  of  OLAF 
staff  members  continued  to  decrease  in  2018.  At  the 
end  of  2018,  the  total  number  of  staff  members  and 
available vacancies at OLAF stood at 389, a 4% decrease 
compared  to  2017.  Despite  this,  OLAF  did  its  utmost 
to  maintain  the  staff  resources  allocated  to  the  fight 
against  fraud  and  to  its  anti-fraud  policy  work,  with 
staff cuts mainly impacting overhead functions such as 
HR, finance and ICT infrastructure management.

OLAF staff members have had to adapt to a structural 
increase  in  workload,  while  maintaining  the  quality 
and efficiency of investigations. In a context of limited 
resources, OLAF counts on the wide range of skills and 
diverse  professional  background  of  its  staff.  Dealing 

efficiently  with  a  high  number  of  investigations  in 
various  fields  and  countries  requires  a  high  level  of 
expertise, knowledge of a broad range of languages, as 
well as commitment to defending taxpayers’ interests. 
Two  specialist  competitions  in  the  investigation  field 
were  finalised  in  2017,  providing  OLAF  with  a  list  of 
45 
laureates  possessing  the  relevant  professional 
experience  and  qualifications.  In  2018,  OLAF  almost 
doubled the number of people it recruited, going from 
23 the previous year to 42.

OLAF  continuously  invests  in  career  development. 
OLAF  staff    have  the  opportunity  to  participate  in 
European  Commission  or  external  training,  coaching 
sessions  or  lunchtime  debates  and  workshops,  which 
further  their  professional  and  personal  development. 
OLAF is also committed to investing in the training of 
its managers, to ensure excellent leadership.

OLAF Directors and Director-General

Figure 17: Number and breakdown of OLAF staff from 2011 to 2018

Establishment posts occupied

Establishment posts vacant

External staff

Total

2011

351

33

53

437

2012

347

35

53

435

2013

350

34

56

440

2014

362

18

59

439

2015

356

11

55

422

2016

336

24

55

415

2017

318

32

55

405

2018

318

27

44

389

52

The OLAF report 2018Figure 18: Organisational chart (31.12.2018)

Unit 0.1
Investigation 
Selection & Review
Corinna Ullrich 

Unit 0.2
Budget & HR Business 
Correspondent, 
Strategic Planning  
and Security
Jacky Marteau

Assistant: 
Marco D’Ambrosio

Assistant: 
Oana Marin

Assistant: 
Nadine Kolloczek

Director-
General
Ville Itälä

Internal Auditor:
Pedro Andreo Andreo

Data 
Protection Officer:
Veselina Tzankova

Spokesperson: 
Alina Burea

Supervisory 
Committee

Chair: Jan Mulder

Members:  
Petr Klement,  
Maria Helena Fazenda,  
Grazyna Maria 
Stronikowska,  
Rafael Munoz  
Lopez Carmona

Directorate A
Investigations I
Dominik Schnichels

Directorate B
Investigations II
Ernesto Bianchi

Directorate C 
Investigation Support
Beatriz Sanz Redrado

Directorate D
Policy
Margarete Hofmann

Adviser
Konstantinos Chatzipazarlis 
(acting) 

Adviser
Jean-Philippe Liénard

Adviser
Maria Ntziouni-Doumas

Unit A.1
EU Staff
Lara Dobinson

Unit B.1
Customs & Trade Fraud
James Sweeney

Unit C.1
Investigation Workflow
Claire Scharf-Kröner

Unit A.2
Neighbouring countries and 
international organisations
Antonio Miceli

Unit B.2
Tobacco & 
Counterfeit Goods
Salvatore Catania
(acting)

Unit C.2
Information Systems 
Infrastructure and 
Development
Konstantinos Bovalis

Unit D.1
Policy Development  
& Hercule
Irene Sacristan Sanchez 

Unit D.2
Fraud Prevention, 
Reporting & Analysis
Frank Michlik

Unit A.3
Centralised Expenditure
Vasil Kirov

Unit B.3
Agricultural & Structural 
Funds I
Cvetelina Cholakova

Unit C.3
Operational Analysis & 
Digital Forensics
Eduardo Cano Romera

Unit D.3
Interinstitutional & 
External Relations
Charlotte Arwidi

Unit A.4
External Aid
Marco Pecoraro

Unit B.4
Agricultural & Structural 
Funds II
Amira Szonyi

Unit B.5
Agriculture & Structural 
Funds III
Francesco Albore 

Unit C.4
Legal Advice
Dorothe Dalheimer

Unit D.4
Customs & Tobacco  
Anti-Fraud Policy, AFIS
Georg Roebling 

53

The OLAF report 2018Figure 19: OLAF’s administrative budget in 2018 (million euros)

EU staff 

Infrastructure

ICT

External agents (contract staff, seconded national experts and interims)

Missions

Anti-fraud Measures

Training, meetings and Committees

Total

40.9

7.0

4.9

2.5

1.4

1.9

0.5

59.1

54

The OLAF report 201810.  Statistical annex: additional data on OLAF 

investigative activity

This annex presents additional detailed data relating to OLAF’s investigative activity in 2018, as a complement to the 
key indicators already mentioned in chapters 2 and 5.

Figure 20: OLAF’s investigative performance

Incoming information

Investigations opened

Investigations concluded

Recommendations issued

2010

975

152

136

172

2011

1041

146

154

175

2012

1264

431

266

199

2013

1294

253

293

353

2014

1417

234

250

397

2015

1372

219

304

364

2016

1136

219

272

346

2017

1295

215

197

309

2018

1211

219

167

256

Figure 21: Selections completed and their duration*

Selections completed

Average duration (in months) 
of selection phase

2010

2011

886

6.3

926

6.8

2012

1770

1.4

2013

1247

1.8

2014

1353

2.0

2015

1442

1.7

2016

1157

1.7

2017

1111

2.4

2018

1259

2.6

*  Since a new case management system was introduced at the end of 2016, the processing of new incoming information required more 

time. This explains why the average duration of selections has increased to 2.6 months in 2018. It is expected that the average duration 
of selections will decrease.

Figure 22: Average duration of closed and ongoing investigations (in months)

Average duration of investigation

Average duration of selection 
corresponding to these cases

2010

20.8

6.4

2011

22.4

6.9

2012

2013

2014

17.3

6.3

17.5

4.3

18.1

2.9

2015

18.7

2.3

2016

17.2

1.7

2017

15.8

1.8

2018

16.4

2.2

Total average duration of cases

27.2

29.3

23.6

21.8

21.0

21.0

18.9

17.6

18.6

Figure 23: Average duration of closed investigations only (in months)

Average duration of investigation

Average duration of selection 
corresponding to these cases

2010

2011

22.9

5.6

27.0

6.1

2012

22.5

7.5

2013

22.3

5.9

2014

23.3

3.6

2015

25.1

2.8

2016

23.2

1.8

2017

21.9

1.7

2018

23.1

1.9

Total average duration of cases

28.5

33.1

30.0

28.2

26.9

27.9

25.0

23.6

25.0

55

The OLAF report 2018Figure 24: Percentage of ongoing investigations lasting more than 20 months

2010

41%

2011

38%

2012

22%

2013

30%

2014

30%

2015

22%

2016

20%

2017

22%

2018

22%

Percentage of ongoing investigations 
lasting more than 20 months

Figure 25: Recommendations issued

Type of recommendation

2010

2011

2012

2013

2014

2015

2016

2017

2018

Financial

Judicial

Disciplinary

Administrative

Total

62

67

10

33

63

73

16

23

116

233

54

25

4

85

24

11

253

101

15

28

220

209

195

168

98

16

30

87

18

32

80

10

24

48

18

22

172

175

199

353

397

364

346

309

256

Figure 26: Incoming information by source

Source

PRIVATE

PUBLIC

Total

2010

594

381

975

2011

767

274

2012

889

375

2013

889

405

2014

959

458

2015

933

439

2016

756

380

1041

1264

1294

1417

1372

1136

2017

889

404

1293

2018

807

404

1211

56

The OLAF report 2018Figure 27:  Incoming information from Member States in 2018

Member State

Public source

Private source

Total

Austria

Belgium

Bulgaria

Croatia

Cyprus

Czechia

Denmark

Estonia

Finland

France

Germany

Greece

Hungary

Ireland

Italy

Latvia

Lithuania

Luxembourg

Malta

Netherlands

Poland

Portugal

Romania

Slovakia

Slovenia

Spain

Sweden

United Kingdom

Total

1

6

3

0

0

0

0

0

1

2

1

3

1

0

0

2

3

0

0

2

0

1

2

3

1

5

0

0

3

12

45

26

1

21

4

0

2

14

28

26

32

6

23

1

3

2

3

3

35

12

56

24

3

27

3

6

4

18

48

26

1

21

4

0

3

16

29

29

33

6

23

3

6

2

3

5

35

13

58

27

4

32

3

6

37

421

458

57

The OLAF report 2018Overview of tables and charts

Figure 1: EU expenditure in 2018 ..................................................................................................................................................................................................11

Figure 2: EU revenue in 2018 ...........................................................................................................................................................................................................11

Figure 3: OLAF’s investigative activity in 2018 .................................................................................................................................................................12

Figure 4:  Investigations into the use of EU funds managed or spent in whole or in part  

at national or regional level concluded in 2018 .........................................................................................................................................13

Figure 5: Ongoing investigations at the end of 2018, by sector ..........................................................................................................................13

Figure 6: Cigarettes seized with the support of OLAF (rounded to million sticks)  .............................................................................21

Figure 7: Investigations into EU staff and members of the institutions concluded in 2018 ..........................................................23

Figure 8: Four-Step EU Funds Fraud .........................................................................................................................................................................................26

Figure 9: Fraud in the IT field ........................................................................................................................................................................................................28

Figure 10: Carousel fraud to evade paying VAT ...............................................................................................................................................................31

Figure 11: Amounts recommended by OLAF for financial recovery in 2018 (in million euros) ...................................................36

Figure 12:  Member State/OLAF detection of irregularities and their financial impact  

in the area of Traditional Own Resources for the period 2014-2018 ......................................................................................38

Figure 13:  Member State/OLAF detection of irregularities and their financial impact in the areas  

of European Structural and Investment Funds and Agriculture for the period 2014-2018 ...................................39

Figure 14:  Actions taken by national judicial authorities (JA) following OLAF’s recommendations  

issued between 1 January 2012 and 31 December 2018 ....................................................................................................................41

Figure 15:  Actions taken by the appointing authorities following OLAF’s disciplinary recommendations  

issued between 1 January 2016 and 31 December 2018 ....................................................................................................................42

Figure 16: Enhancing data collection and analysis ....................................................................................................................................................... 44

Figure 17: Number and breakdown of OLAF staff from 2011 to 2018 ............................................................................................................. 52

Figure 18: Organisational chart (31.12.2018) ....................................................................................................................................................................... 53

Figure 19: OLAF’s administrative budget in 2018 (million euros) ......................................................................................................................54

Figure 20: OLAF’s investigative performance ................................................................................................................................................................. 55

Figure 21: Selections completed and their duration .................................................................................................................................................... 55

Figure 22: Average duration of closed and ongoing investigations (in months) ................................................................................... 55

Figure 23: Average duration of closed investigations only (in months) ....................................................................................................... 55

Figure 24: Percentage of ongoing investigations lasting more than 20 months ..................................................................................56

Figure 25: Recommendations issued .......................................................................................................................................................................................56

Figure 26: Incoming information by source .......................................................................................................................................................................56

Figure 27: Incoming information from Member States in 2018 .......................................................................................................................... 57

58

The OLAF report 2018GETTING IN TOUCH WITH THE EU

In person

All over the European Union there are hundreds of Europe 
Direct information centres. You can find the address of the 
centre nearest you at: https://europa.eu/european-union/
contact_en

On the phone or by e-mail

Europe Direct is a service that answers your questions about 
the European Union. You can contact this service:

– by freephone: 00 800 6 7 8 9 10 11 

(certain operators may charge for these calls),

– at the following standard number: +32 22999696 or 
– by email via: https://europa.eu/european-union/contact_en

FINDING INFORMATION ABOUT THE EU

Online

Information about the European Union in all the official languages  
of the EU is available on the Europa website at:  
https://europa.eu/european-union/index_en

EU Publications

You can download or order free and priced EU publications at:  
https://publications.europa.eu/en/publications. Multiple copies of free 
publications may be obtained by contacting Europe Direct or your local 
information centre (see https://europa.eu/european-union/contact_en).

EU law and related documents

For access to legal information from the EU,  
including all EU law since 1952 in all the official language versions,  
go to EUR-Lex at: http://eur-lex.europa.eu

Open data from the EU

The EU Open Data Portal (http://data.europa.eu/euodp/en)  
provides access to datasets from the EU. Data can be downloaded and 
reused for free, for both commercial and non-commercial purposes.

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