The government has instructed the country’s Financial Crimes Squad (SDOE) to scrutinize companies suspected of fraudulent use of European Union investment subsidies.
In a document forwarded to Parliament, Finance Minister Yannis Stournaras says SDOE will conduct targeted, on-site verifications of (subsidized) investment schemes – in some cases jointly with the European Anti-Fraud Office (OLAF).
“Where cases of fraud or irregularities are identified, SDOE will adopt the necessary measures so that the responsible public agencies retrieve the inappropriately and illegally disbursed sums,” the document says.
The paper was forwarded to Parliament in response to a question posed by five Democratic Left party MPs. The deputies cited a State Audit Council report relating to European investment subsidies paid to bogus companies in the last 10 years which provided the basis for a case file prepared by two financial prosecutors. According to the prosecutors’ instructions, SDOE’s 13 regional directorates will scrutinize subsidies disbursed to companies since 2004 in order to ascertain whether whether the sums were devoted to development purposes or were used to cover salary expenses or were even spent by the owners themselves. The probes will touch upon how long the subsidized companies remained operational, the reasons they may have been dissolved, the channeling of the funds to offshore companies and whether the companies had been set up for the sole purpose of collecting subsidies.
The issue has also attracted the attention of the European Commission, which asked the government to conduct the probes following the discovery of four cases in which prospecting investors were blackmailed by Development Ministry officials in order to approve subsidies.
“Regarding the four recent cases, where officials of the General Directorate of Private Investment of the Development Ministry are said to have been involved in instances of bribery and blackmailing investors, the Commission has asked the responsible Greek authorities to undertake coordinated action in order to ascertain whether the disbursements have been burdened by bribery, blackmail or any other form of corruption or fraud,” the document said.
Stournaras further noted that a cut of 5 percent had been instituted in the budget of responsible directorate.