EU authorities arrest 22, seize €600m over Covid-19 funding fraud
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The news: Authorities in Italy, Austria, Romania and Slovakia have arrested 22 people across the bloc following an investigation into a criminal network defrauding the union of millions in Covid-19 recovery funds.
The numbers: The 22 people are suspected of defrauding €600 million ($985.9 million) from Italy’s National Recovery and Resilience Facility (NRRF).
The context: The probe was led by the European Public Prosecutor’s Office in Italy, which has been investigating a criminal association that it believes orchestrated a fraud scheme to obtain the funds from the NRRF, the main pillar of the NextGenerationEU recovery plan.
In 2021 the suspected criminals applied to receive grants that were to support digitalisation, innovation and competitiveness for small businesses, by creating and depositing false corporate balance sheets to show that the companies were active and profitable, when they were in fact entirely fictitious.
A network of accountants, service providers and public notaries allegedly supported the suspects to successfully obtain the funds, which were promptly transferred to bank accounts in Austria, Romania and Slovakia. The suspects used VPNs, international cloud servers, crypto-assets and AI software in efforts to conceal and protect their activities.
