Introduction
The EPPO’s Annual Report 2023 demonstrates that serious organised crime continues to feast on EU revenue. Organised crime groups consider VAT fraud and fraud relating to EU funds a ‘clean area’ – high in profit, low in risk, and with no obvious victims who would report such crimes. Of the total estimated financial damage corresponding to the EPPO’s active investigations during the reporting period, €11.5 billion (59%) was linked to cross-border VAT fraud. This type of crime is nearly impossible to uncover from a purely national perspective, and often involves sophisticated criminal organisations, who do not shy away from extreme violence when it comes to protecting their interests, and have almost unlimited means of corrupting our democratic institutions.
‘If we want to seriously affect criminals’ ability to operate, let alone grow and expand their activities, we must take white-collar criminals out of the equation. Our strategy should be to cripple the financial capacity of the serious organised crime groups. We are here to help.’
– European Chief Prosecutor Laura Kövesi
Operational activity
By 31 December 2023, we had 1 927 active investigations, for estimated damage of over €19.2 billion. 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. Ultimately, in line with the EPPO’s 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.
Types of crimes investigated
By the end of 2023, around 34% of the offences investigated by the EPPO concerned alleged non-procurement expenditure fraud. This type of fraud is committed via the use or presentation of false, incorrect or incomplete statements or documents, which has, as its effect, the misappropriation or wrongful retention of funds or assets from the EU budget or budgets managed by the EU, or on its behalf – such as financial aid and subsidies. Approximately 20% of the offences investigated by the EPPO concerned the most serious forms of VAT fraud, connected with the territory of two or more participating EU Member States, and causing total damage of at least €10 million.
Next Generation EU
By the end of 2023, the EPPO had 206 active investigations related to NextGenerationEU funding, with an estimated damage of over €1.8 billion. This represents approximately 15% of all the cases of expenditure fraud handled by the EPPO during the reporting period, but in terms of estimated damage, it corresponds to almost 25%. This shows that NextGenerationEU funding is a target for fraudsters.
Activity of the College, Permanent Chambers, Operations and College Support
Activity of the European Delegated Prosecutors
The European Delegated Prosecutors form the front line of the EPPO, working on the decentralised level in 22 different EU Member States. It is their key responsibility to investigate, prosecute and bring to judgment crimes affecting the financial interests of the EU – including taking timely and legally correct decisions, fulfilling the reporting obligation to the Permanent Chambers and cooperating with other European Delegated Prosecutors in cross-border cases. The offices of the European Delegated Prosecutors are located in 42 cities in the 22 Member States. On 31 December 2023, there were 140 European Delegated Prosecutors in active employment.
Administrative services
Human resources
After 2022, which saw the number of staff members at the EPPO Central Office almost double, 2023 constituted a year of organisational stabilisation and increased maturity. This context provided the opportunity to reinforce the foundations of the EPPO’s human capital management framework, shifting its focus from recruitment and organisational growth to a forward-looking strategic plan. An overall occupancy rate of 90.63%, and a turnover rate of 5.9% for temporary and contract agents, was registered.
IT, Security and Corporate Services
The EPPO’s IT, Security and Corporate Services unit continued, in 2023, the implementation of its two already ongoing major programmes: the IT Autonomy Programme, to offer a complete catalogue of administrative IT services fully managed internally, and the Case Management System (CMS) Programme, to further develop the digitalisation of the organisation in its core business area.
Finance
The EPPO’s budget is fully financed by the General Budget of the EU in the form of a subsidy. In 2023, €66 million was budgeted for the delivery of the EPPO’s mission, compared to €51.2 million in 2022 (+29%). The main drivers in this budget evolution were a strong dynamic in staff costs, due to progress towards full occupancy of Central Office statutory staff posts and Seconded National Expert posts. A larger number of European Delegated Prosecutors were deployed, compared to 2022, and the consolidation and further developments of the Case Management System (CMS) ecosystem were continued.
Relations of the EPPO with its partners
In 2023, the EPPO pursued the implementation of its external strategy to reinforce ties and foster cooperation with all concerned counterparts, including institutions, bodies, offices and agencies of the EU, relevant authorities of non-EU countries and EU Member States not participating in the EPPO, as well as international organisations, expert networks and fora. Raising awareness, around the globe, of the EPPO’s mandate, tools and jurisdiction where EU funds are involved, is key to increasing the reporting of crime, and to ensuring trust and effective cooperation from its partners.
