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28 November, 2022
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EU investigators follow the money to Cyprus

European Anti-Fraud office uncovers misuse of EU funds linked to Cyprus casino project


Cyprus came on the European Anti-Fraud Office’s radar this week, after it emerged that money allegedly stolen from an environmental project was diverted to a casino project on the island.

(Click here for an update to the story)

According to the European Anti-Fraud Office (OLAF), the Research Executive Agency (ERA) became suspicious of one of its projects aimed at improving forest fire detection. The project was expected to be run by a consortium of five small and medium-sized enterprises based in France, Ireland, Romania and Spain.

REA reportedly became concerned that some claims for personnel costs submitted by the consortium might be false and reported these suspicions to OLAF.

OLAF investigators established that the consortium never had the capacity to carry out the project, adding that stolen money was being pumped into a casino project in Cyprus

OLAF investigators established that the consortium never had the operational capacity to carry out the project, adding that stolen money was being pumped into a casino hotel project in Cyprus.

Investigators cited an in-depth investigation saying the consortium members had “simply siphoned off the vast majority of the EU funding” and diverted the stolen money “about as far from its intended purpose as can be imagined.”

The amount of money allegedly linked to the casino project was not specified, while OLAF recommended that REA recover €410,000 from the consortium.

“The initial funding application and the subsequent progress reports were based on lies and justified by false documents,” OLAF added.

The role of REA, a funding body of the European Commission that works in the field of research and innovation, is to support researchers in accessing European funds and to help them through the implementation of their projects.

OLAF Director-General Ville Itala, who is serving a non-renewable seven-year term, said the European Commission’s ambitious Green Deal and the coronavirus pandemic meant that his office had to ensure EU money was properly spent.

“Now more than ever, every euro counts, and OLAF will continue to ensure it is properly accounted for,” Itala said.

Following the completion of the probe in November 2019, the European auditors asked national judicial authorities to initiate proceedings against individuals involved.

While OLAF can make legal recommendations to states if they find misuse of EU funds, it is up to national judicial authorities to decide whether to investigate and prosecute the cases.

Cyprus  |  OLAF  |  EU  |  casino  |  anti-fraud  |  Commission  |  probe

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