European Public Prosecutor’s Office opened 14 investigations in Malta last year worth €123.5 million

The European Public Prosecutor’s Office (EPPO) opened 14 investigations into the suspected fraud of EU funds in Malta last year worth an estimated value of €123.5 million.

All 14 investigations were active at the end of last year. The EPPO does not make the details of the investigations it is conducting public but it does give general indications.

Three of the investigations concerning Malta are active VAT fraud cases that are alone worth €70.5 million, according to data in the EPPO’s annual report published Wednesday morning.

The EPPO has five ongoing expenditure investigations in Malta. Three of these deal with agricultural and rural development programmes, one with maritime and fisheries programmes, and another is related to mobility and transport, energy, and digitalisation programmes.

In addition, there were a total of 18 reports and complaints regarding Malta over 2022 – 14 from national authorities, two from EU institutions, one ex-officio and one from a private party.

The typologies of active EPPO cases regarding Malta include four distinctly related to corruption and to money laundering.

Other typologies include six related to VAT revenue fraud, three to non-VAT revenue fraud, three related to non-procurement revenue fraud, two for procurement fraud, as well as one inextricably linked offence.

Malta is also involved in four cross-border EPPO investigations.

Malta’s European Delegated Prosecutors made five outgoing requests for assistance from other member states and they received 17 incoming requests for assistance from other EU member states.

Across the EU, the EPPO had 1,117 active investigations with overall estimated damages of €14.1 billion, nearly half of which (47%) resulted from VAT fraud, across the EU.

In 2022, the EPPO received and processed 3,318 crime reports and opened 865 investigations. Moreover, judges granted the freezing of €359.1 million in EPPO investigations, compared to €147.3 million in 2021.

European Chief Prosecutor Laura Kövesi commented, “A year and a half after the start of our activities, the potential of the EPPO cannot be ignored. In 2022, we have demonstrated that the EPPO has an unprecedented capacity to identify and trace volatile financial flows and opaque legal arrangements. We have proven that the speed, efficiency and information gains in EPPO-led investigations make it hard for traditional cross-border coordination methods to compete.

“We are on the right track, but we need to do more. The EPPO is far from having reached its full potential.”

The European Delegated Prosecutors form the front line of the EPPO, working on the decentralised level in the 22 participating EU Member States. Malta’s European Delegated Prosecutors are Geoffrey Azzopardi and Martin Sammut.

They have the same priorities and implement the same prosecutorial policy. Their focus is on complex, cross-border investigations into sophisticated economic and financial criminality, in particular where serious organised criminality is involved.

The EPPO in 2022 saw the first positive evolution for the detection of fraud affecting the financial interests of the EU in some Member States.  There are now more investigations into EU fraud initiated in the 22 of them.

The EPPO comments, “This is particularly visible on the revenue side of the EU budget, with an increased focus by some national authorities starting to bear fruit, as well as the EPPO using its ‘helicopter view’ and capacity to identify links that had remained hidden, so far.”

However, significant discrepancies remain, particularly in the fight against cross-border VAT fraud.

While the EPPO has found the numbers in its annual report to be “very encouraging”, it says “they do not yet mirror the expected gradual improvement of the overall level of detection of EU fraud”.

With the first projects funded under the €672.5 billion Recovery and Resilience Facility only starting to be implemented, they do not yet mirror the growth of the volume of the EU’s financial interests that need to be protected.

Malta will be receiving €316.4 million from the Recovery and Resilience Facility.