Annual Report 2023: EPPO warns that serious organised crime continues to feast on EU revenue

More than 330 investigations into serious cross-border VAT fraud, with €11.5 billion worth of damage

(Luxembourg, 1 March 2024) – The latest Annual Report of the European Public Prosecutor’s Office (EPPO) shows that at the end of 2023, it had a total of 1 927 active investigations, with an overall estimated damage to the EU budget of €19.2 billion – 59% of which (€11.5 billion, corresponding to 339 investigations) was linked to serious, cross-border VAT fraud. This type of fraud often involves sophisticated criminal organisations, and is nearly impossible to uncover from a purely national perspective. 

New sources of EU funding are also being targeted by fraudsters. By the end of 2023, the EPPO had 206 active investigations relating to the first NextGenerationEU funding projects, with an estimated damage of over €1.8 billion. This represents approximately 15% of all cases of expenditure fraud involving EU funds handled by the EPPO during the reporting period, but in terms of estimated damage, it corresponds to almost 25%. This number can only increase, in the context of the accelerated implementation of NextGenerationEU funding. In 2023, the EPPO also began to identify organised crime groups involved in this type of fraudulent activity.

Organised crime is fuelled by defrauding the EU budget

‘The scale of fraud affecting the financial interests of the EU, in particular on the revenue side of the budget, can only be explained by the heavy involvement of serious organised crime groups’, warns European Chief Prosecutor Laura Kövesi. 

‘In our investigations, we see serious organised crime groups financing VAT fraud operations with money obtained from their other criminal activities. We see the same specialised operators laundering money from VAT fraud and the other criminal activities of these groups. Our strategy should be to cripple the financial capacity of the serious organised crime groups’. 

In ongoing EPPO investigations, participation in a criminal organisation is most often found in connection with VAT carousel fraud schemes, or with customs fraud. However, criminal organisations also operate in the field of fraud involving EU funds, both in non-procurement fraud (for example, organised defrauding of agricultural funds), or procurement fraud (such as unlawful participation in multiple large-scale procurement procedures).

Improved detection and performance 

In 2023, the EPPO received and processed 4 187 crime reports, which is 26% more than in 2022. This increase has been driven mainly by reports from private parties (2 494 – 29% more than in 2022), as well as from national authorities (1 562 – 24% more than in 2022). This evolution proves that the level of detection of fraud affecting the financial interests of the EU in the participating Member States has further improved. 

Last year, we opened 1 371 investigations, which is 58% more than in 2022 – corresponding to damage estimated at €12.28 billion. This is mostly the result of the combination of improved cooperation between the EPPO and the relevant national authorities, and the EPPO’s determination to target criminal organisations particularly active in subsidy fraud (non-procurement expenditure fraud) and revenue fraud (VAT and customs). 

In 2023, with 139 indictments filed (over 50% more than in 2022), the EPPO started to bring more perpetrators of EU fraud to judgment in front of national courts. 

In line with its objective to focus on damage recovery, judges granted European Delegated Prosecutors freezing orders worth €1.5 billion, which is over four times more than in 2022.

However, this is still only a fraction of the vast illicit profits of criminal networks, which could exceed hundreds of billions annually, according to recent estimates. In light of this, the European Chief Prosecutor urges that the performance of the EPPO ‘is not only a matter of elementary economic interest, it is also a matter of internal security’.

2023 in numbers

Here are some of the key figures featured in the Annual Report, valid on 31 December 2023:

• 4 187 crime reports were processed (26% more than in 2022);
• 1 371 investigations were opened (58% more than in 2022);
• 1 927 active investigations (with estimated damage of €19.2 billion);
• 17.5% of active investigations (339) were linked to VAT fraud, but account for 59% (€11.5 billion) of the overall estimated damage;
• Over 200 investigations related to funding under NextGenerationEU, with an estimated damage of over €1.8 billion;
• €1.5 billion in freezing orders granted (over four times more than in 2022);
• 139 indictments filed (over 50% more than in 2022), with 458 persons indicted;
• 140 European Delegated Prosecutors in active employment;
• 232 statutory staff members at the Central Office in Luxembourg.

Visit our dedicated page '2023 in numbers'

The full Annual Report 2023 can be consulted here (also available in this link): 

The EPPO is the independent public prosecution office of the European Union. It is responsible for investigating, prosecuting and bringing to judgment crimes against the financial interests of the EU.