Two Suspects Detained in €2 Million Corporate Fraud Case in Romania
Overview
(1 February 2024, Luxembourg) — The European Public Prosecutor’s Office (EPPO) in Iași, Romania, initiated a probe into a significant corporate financial crime case involving an IT project in early 2024. Two individuals, including the main suspect, were detained, and four others were placed under judicial control. This article provides a detailed account of the case.
Investigations Unfold
The European Public Prosecutor’s Office launched an investigation following a request and led operations in several locations in Romania, including Bucharest, Iași, Vaslui, and Ilfov. International collaborations were also established with Belgium, Bulgaria, Italy, Lithuania, and the Republic of Moldova.
Alleged Fraudulent Activities
A Romanian firm under scrutiny reportedly sought up to €2 million (RON 10 953 924) in non-repayable EU funds for an IT project, PIST - Innovative Platform for Rapid and Secure Financial Transactions. The ensuing investigation revealed several fraudulent activities between 2020 and 2022:
- False or inaccurate documents were submitted for services and goods never delivered or purchased.
- Employment contracts with non-existent employees were identified, leading to an illegally obtained sum of €1 million from the EU budget.
Money Laundering Allegations
According to preliminary findings, these European Union funds were allegedly subjected to money laundering through various domestic and international financial circuits, using shell companies in Spain and Bulgaria and bank accounts in Belgium and Lithuania. Concerning transactions involved the transfer of Romanian-registered companies’ shares to Moldovan and Italian citizens to evade potential investigations.
Current Status
The suspects have been informed of their status as suspects at the EPPO office in Iași, and others will follow in the coming days. Offenses of aggravated subsidy fraud and money laundering may potentially be implicated.
Seizure of Assets and Gratitude
The European Public Prosecutor’s Office aims to recover losses from the EU budget and judicial expenses through the seizure of two apartments worth approximately €250,000, plots of land, and the freezing of bank accounts belonging to the suspects and their companies.
The European Public Prosecutor’s Office expressed gratitude to various Romanian entities for their assistance in the case including:
- EPPO Support Structure in Romania
- Romania’s Anti-Corruption General Directorate and subordinate territorial structures in Bucharest, Ilfov, and Vaslui
- The Economic Crime Investigation Service of the Iași County Police Inspectorate
- The Special Intervention Brigade of the Romanian Gendarmerie.
Background
The European Public Prosecutor’s Office is the European Union’s independent public prosecution agency responsible for investigating, prosecuting, and adjudicating crimes against the financial interests of the EU.