Czechia: Six convicted of €1.8 million EU funding fraud involving the expansion of a technological centre

(Luxembourg, 2 February 2024) – Yesterday, following an investigation led by the European Public Prosecutor’s Office (EPPO) in Zlín (Czechia), the Olomouc branch of the Regional Court of Ostrava convicted three individuals and three companies of EU funding fraud.

The investigation revealed that the primary defendant submitted two requests for payment to the Czech Ministry of Industry and Trade (MIT), for a total amount of €1.8 million, for a project to expand a new technological centre, which was entirely financed by the EU’s Structural Fund. According to the evidence, the prices of the machinery requested by the defendant’s company were artificially increased, and he provided false and incorrect documents to receive more money.

Furthermore, the collected evidence gave grounds to suspect that two more individuals and two more companies had helped the primary defendant to receive the €1.8 million in EU funds for the expansion of the new technological centre.

As previously reported, all six pleaded guilty, and the primary defendant paid back the total amount of damage of €1.8 million, as part of the plea agreement.

The Olomouc branch of the Regional Court of Ostrava approved the agreement on guilt and punishment concluded between the European Delegated Prosecutor and the accused, and sentenced the individuals to between one and three years’ imprisonment with probation, and to the payment of fines ranging from €4000 to €40 000. All companies were sentenced to pay fines between €12 000 and €200 000. In addition, the primary defendant and his company have been banned from applying for subsidies for a period of 8 and 10 years.

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.