Financial Crime World

EU Prosecutors and Czech Authorities Conduct Raid on Suspected Hospital Supplies Corruption Scam

Coordinated Action Against Suspected Criminal Organization

  • February 19, 2024, Prague, Czech Republic: The European Public Prosecutor’s Office (EPPO) and Czech authorities executed 36 searches, resulting in the arrest of ten suspects.
  • These included hospital managers and directors of medical equipment suppliers.

Probe Overview

  • Led by the Prague-based European Delegated Prosecutor’s Office.
  • Allegations of a corrupt scheme to manipulate public contracts for hospital medical supplies.

Search Warrants

  • Conducted at the homes and offices of the suspects.
  • Two hospitals in Prague and Brno also searched.
  • Czech police’s National Centre against Organized Crime (NCOZ) executed the warrants.

Corrupt Practices Alleged

  • Formation of a criminal organization.
  • Systematic influence on public procurement processes.
  • Pre-determined suppliers granted unfair advantage.

Confidential Information Access

  • Preferred suppliers received confidential information.
  • Tailored offers to meet contract requirements.
  • Constituted corrupt activity, believed.

Contracts and Bribes

  • Contracts involved supplies of medical equipment.
  • Operating tables, laparoscopic and arthroscopic surgery equipment.
  • Endoscopes, defibrillators, surgical drills, ventilators.
  • Suppliers paid bribes (10% of contract value).

Alleged Intermediary

  • Bribes transferred through an intermediary.
  • Individual believed to be head of the criminal organization.

EU Funds Affected

  • Some contracts co-funded by the European Regional Development Fund (ERDF).
  • Fraudulent activities could reach close to €1 million in EU budget damage.

Suspected Offenses

  • Damage to EU financial interests.
  • Procurement fraud.
  • Active and passive corruption.
  • Organized criminal group participation.
  • Money laundering.

Background

  • European Public Prosecutor’s Office is the EU’s independent public prosecution office.
  • Responsible for investigating, prosecuting, and judging crimes against the financial interests of the EU.

Update (20 February 2024)

  • Ten suspects officially accused.
  • Two formally charged.
  • Eight subject to filing of arrest warrant.
  • Related to their involvement in the alleged corruption scheme.