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(Luxembourg, 6 October 2023) – The European Public Prosecutor’s Office (EPPO) in Iași (Romania) has submitted three plea agreements to the Bucharest Tribunal, in a case involving fraudulent use of EU funds by a company specialised in the painting of religious icons.
Three individuals admitted their guilt, and requested the conclusion of a plea bargaining agreement. Two companies were also referred to the court, for offences of subsidy fraud and money laundering.
At issue is an investigation into fraudulent use of EU funds. One of the companies charged, which paints religious icons for churches and the hospitality sector, obtained EU funding for a project to purchase equipment to support artistic creation, including industrial printers and sculpting and engraving machines.
However, according to the evidence, the company bought the machinery from China for a fraction of the price stated to the funding body. This purchase was made via an intermediary company, which was created specifically for this purpose, and controlled by managers of the beneficiary of the EU funds. It is believed that this intermediary company sold the equipment to the beneficiary of the funds for ten times its original price. To hide the fraudulent transactions, the company is believed to have presented false invoices and forged documents stating the inflated costs to the managing authority, Romania’s Agency for Financing Rural Investments (AFIR).
The three individuals, who controlled the two companies, have admitted to having committed the offences for which they were charged, and agreed to the sentences imposed. These include two years and eight months’ imprisonment for the main defendant – the execution of which shall be suspended under supervision for a period of three years. The second individual has agreed to a sentence of two years and two months’ imprisonment, and the third, to two years’ imprisonment – suspended, in both cases, for two years and six months.
If the two companies are convicted, the court may order confiscation of assets and a fine of up to approximatively €400 000 (RON 2 000 000), to which additional penalties may be added.
Earlier in this investigation, the police seized four properties (two apartments and two land lots), worth approximately €200 000, in order to recover the damage to the EU budget and any judicial expenses.
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.