International investigations

Irregularities in the implementation of ERASMUS + projects

ERASMUS+ is a multi-billion EU fund supporting education, training, youth and sport across Europe. One of the key functions of Erasmus+ is to create programmes enabling mobility opportunities for learners and supporting cooperation projects between academic partners.

OLAF investigated allegations of fraud involving misallocation of funds for schools in North Macedonia due to a conflict of interest and manipulation of the award procedure over a period of 6 years.

The OLAF investigation identified 50 persons and entities concerned in North Macedonia and five EU Member States. OLAF also conducted on the spot checks in the premises of the consultants with digital forensic operations.

The OLAF investigation established that sensitive and confidential information concerning Erasmus + applicants and evaluators was leaked to consultants by unidentified staff members of the National Agency for European Educational Programmes and Mobility (NAEEPM) of North Macedonia.

This information was used by the consultants to interfere with the evaluation and award procedure of ERASMUS + grants. In addition, over 15 schools subcontracted - without authorisation - the full implementation of the ERASMUS + project to the consultants. This deprived other Erasmus + applicants from receiving grants and undermined the capacity building objectives of the Erasmus + programme.

OLAF recommended that the European Commission consider as ineligible more than 2 million euro in EU funding relating to the 2016-2018 period. OLAF also issued administrative recommendations to strengthen procedures and processes, so as to better prevent such cases from happening in the future.

Given the potential criminal liability of a number of players, OLAF also sent a report of its findings to the judicial authorities of North Macedonia.

Serious misuse of EU pre-accession agricultural funds

OLAF investigated serious allegations involving the misuse of EU funds from the Instrument for Pre-Accession Assistance for Rural Development (IPARD II) in Albania.

IPARD II was designed to help modernise the Albanian agricultural sector to comply with EU standards and achieve progress toward EU membership.

One allegation was that applicants for IPARD II were obliged to pay a large percentage of their grant to ‘pre-selected’ consultancy companies, which would then facilitate contracts with the Albanian Agency for Rural Development and Agriculture (ARDA), which distributed the funds.

After a series of complex investigative steps, including digital forensic searches of documents linked to IPARD II recipients, ARDA and other economic operators, OLAF uncovered several serious irregularities during the grant-awarding phase and the implementation of several projects.

These irregularities included:

• Applicants being requested to pay a sizeable part of their grant to a local consultancy company;
• Contracts being awarded without competition, or through a rigged competition (with fake offers being submitted);
• Inflated prices and breaches of contractual rules.

Following its investigation OLAF recommended that the European Commission consider part of the financing of IPARD II First and Second Call for Applications, €33 million, as ineligible.

OLAF further recommended that the EU prevent €112 million of future funding (IPARD III) to Albania from undue spending, until remedial measures were put in place to protect the EU’s financial interests from any illegal activity.

Given the possible criminal activities discovered during the investigation OLAF also sent a report of its findings to the judicial authorities of Albania.

Investigating in a country at war

OLAF is no stranger to carrying out investigations in challenging environments all over the world. However, these particular investigations proved to be more challenging than others, because they took place in Ukraine.

In June 2023, a team of OLAF investigators and forensic experts travelled to rural Ukraine to investigate cases of alleged irregularities and potential fraud affecting EU funds linked to a cross-border cooperation project.

The first challenge was to gain safe entry into Ukraine without alerting the fraudsters.

Once in the country OLAF carried out on-the-spot checks, spoke with company representatives, carried out full forensic acquisitions of IT data, including those contained on private mobile phones used for work purposes by the persons concerned.

OLAF received crucial support from Ukrainian partners during the investigations. It also served as an ideal opportunity for OLAF investigators to discuss with their Ukrainian partners how to identify tell-tale signs of fraud against EU funded projects.

In many ways this was a mission like no other, as it took place in a country at war. The daily (and nightly) wail of the sirens warning of potential missile attacks provided an eerie soundtrack to the team’s stay in the country, and a sombre, humbling reminder of the plight of the Ukrainian people.

As the investigations are still ongoing, no recommendations have been sent to the relevant authorities.