New EU Prosecutor’s Office to Target Financial Fraud

The European Union’s new prosecutor’s office opened its doors in Luxembourg Tuesday, tasked with cracking down on fraud—just before the 27 member states receive a $920 million injection of post-coronavirus recovery funds. But not all have signed onto the initiative—and one, Slovenia, may be putting up roadblocks.
The European Public Prosecutor’s Office or EPPO is two decades in the making. Now, it’s a reality—a body aimed to tackle economic and financial crime involving EU funds. It’s headed by Romanian anti-fraud prosecutor Laura Kovesi, who spoke at the opening.  
 
“Make no mistake, this is the most common threat of any democratic society. It is underreported, under-estimated, often even tolerated to the benefit of organized criminal organizations that aspire to subvert and replace legitimate authorities,” Kovesi said.
 
So far, 22 of the 27 EU member states are participating in the body. Each will have one prosecutor working at the central office in Luxemburg, and at least two others based in their home countries.  
 
The new entity is expected to deal with about 3,000 cases a year. Justice Commissioner Didier Reynders said reported EU budget fraud amounted to more than $600 million in 2019 alone. Ordinary EU citizens can also report possible financial crime. But Reynders said that efforts to uncover financial crimes must extend beyond EU borders.
 
“The protection of the EU’s financial interest does not and must not stop at the borders of the EU. The trail of fraud and money laundering often leads us to jurisdictions in our immediate vicinity and beyond. This is why the EPPO has to create and nurture close bonds with the competent authorities of the participating member states, as well as the non-participating member states and third countries,” Reynders said.  
 
Several EU member states, including Hungary and Poland, have not joined the prosecutor’s office. Reports say Sweden will join next year.  
 
Meanwhile two members, Slovenia and Finland, have not yet filled their posts of in-country prosecutors. European officials say they expect Finland to do so shortly. That’s not necessarily the case for Slovenia, which takes over the rotating EU presidency in July.  
 
Prosecutor Kovesi said that won’t stop the office from working — but it could pose problems.  
 
“In my view, this is a lack of sincere cooperation and this issue undermines the trust and effective functioning of the management and control system for [the] EU in Slovenia,” Kovesi said.
 
Reynders said if Slovenia doesn’t cooperate soon, Brussels will consider ways to force it to meet its obligations.  
 
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