Fighting fraud in Europe - through OLAF
04 July 2011
The United Kingdom's stance in the fight against fraud has left the European Union watchdog perplexed. Justin Stares talks to the newly appointed Director General of the European Anti-Fraud Office - OLAF.
The European Union's anti-fraud watchdog finds it easier to investigate in Romania and Bulgaria than in the UK. Investigators from OLAF have what director general Giovanni Kessler calls "a point of reference" in Sofia and Bucharest – the national anti-fraud authorities – whereas in the UK, there is no equivalent.
And the two new EU member states "have in place a national authority for anti-fraud, which works in both countries quite well," Mr Kessler tells PublicServiceEurope.com. In the UK, on the other hand "you have a Serious Fraud Office, which is not competent in the whole of the UK". Talking from his office on the 14th floor of the European headquarters in Brussels, the Director General hints that UK authorities are less than completely willing to co-operate when his staff go calling.
"It is not so clear that local or national police authorities, in the UK, have the authority to assist us when we have to do inspections," he says. "In other countries, like in the newly arrived nations, this was foreseen in advance – and, at least, to that extent we are in a better position; we have a clearer reference and a clearer set of rules. When we go to the UK and when we have to make what we call an on-the-spot check or inspection in Scotland, or Wales - for us, it is quite difficult to understand."
Kessler admits that he is to a certain extent comparing apples and pears. There is possibly less need for British officials to hold OLAF's hand because, in the UK, there is less fraud and embezzlement. In Romania and Bulgaria, on the other hand, the "rule of law, the structure of the country is kind of weak". Establishing the rule of law will take more than 10 years, Kessler estimates. It requires a "structure, organisation, also a culture, public awareness". The people themselves need to be educated to reject corruption.
Bulgaria and Romania have been in the news because fellow European Union member states do not want them to join the passport-free Schengen zone. While OLAF has no opinion on their readiness to join, Kessler does on the other hand have an opinion on existing levels of fraud within the EU institutions. It is, he says, "difficult" for officials to fill their pockets with taxpayer money. Fraud within the EU institutions "exists but it's difficult, it's well under control to say the least". The European Commission in particular is a "very well administered body". The commission ministries - the directorates-general - are equipped with "good means to detect signs of possible fraud", says Kessler - a former public prosecutor. "We have had some good results".
The further from Brussels you travel, he admits, the more embezzlement you will find. But here too, blame should not be placed at the door of OLAF. "We have to remind ourselves and your readers that European money is mostly spent by the member states and regions," the Italian says. When faced with evidence that Common Agricultural Fund money is sometimes spent on Ferraris or prostitutes, this is the standard Brussels response.
The image of the EU has this year been sullied again by a British newspaper sting operation. Several MEPs, the Sunday Times alleged in earlier this year, were prepared to accept cash in exchange for tabling amendments. Resignations followed though one MEP, Spain's Pablo Zalba Bidegain, was cleared in June of any wrongdoing by OLAF.
"Our aim is not necessarily to find guilt," explains Kessler. "We are investigating to discover the truth and, in this case, we think that there was nothing wrong with him." While Zalba did talk with journalists posing as consultants about tabling amendments, he did not accept any payments. "He did not commit himself. He didn't make any promises. Even less, did he accept anything, money," Kessler says. "Was he naïve? I don't care."
The journalistic sting led to an unexpected spat between OLAF and the European Parliament. The latter at first denied OLAF's right to investigate, claiming no taxpayer money was at stake. Guards were stationed outside the offices of the MEPs concerned to prevent any inappropriate investigation. "At the beginning, the President of the parliament did not recognise our competence," says Kessler. "I answered to him, and I repeat it now, he was wrong on this. We are competent in investigations on members and staff of institutions, parliament included, even beyond any possible financial interest of the EU."
This right "is set out in the internal rules of EP, which I have reminded the President of the parliament about", concludes Kessler. Investigations involving three other MEPs continue and the level of scrutiny in the future may be a lot higher, as a result.
The European Union's anti-fraud watchdog finds it easier to investigate in Romania and Bulgaria than in the UK. Investigators from OLAF have what director general Giovanni Kessler calls "a point of reference" in Sofia and Bucharest – the national anti-fraud authorities – whereas in the UK, there is no equivalent.
And the two new EU member states "have in place a national authority for anti-fraud, which works in both countries quite well," Mr Kessler tells PublicServiceEurope.com. In the UK, on the other hand "you have a Serious Fraud Office, which is not competent in the whole of the UK". Talking from his office on the 14th floor of the European headquarters in Brussels, the Director General hints that UK authorities are less than completely willing to co-operate when his staff go calling.
"It is not so clear that local or national police authorities, in the UK, have the authority to assist us when we have to do inspections," he says. "In other countries, like in the newly arrived nations, this was foreseen in advance – and, at least, to that extent we are in a better position; we have a clearer reference and a clearer set of rules. When we go to the UK and when we have to make what we call an on-the-spot check or inspection in Scotland, or Wales - for us, it is quite difficult to understand."
Kessler admits that he is to a certain extent comparing apples and pears. There is possibly less need for British officials to hold OLAF's hand because, in the UK, there is less fraud and embezzlement. In Romania and Bulgaria, on the other hand, the "rule of law, the structure of the country is kind of weak". Establishing the rule of law will take more than 10 years, Kessler estimates. It requires a "structure, organisation, also a culture, public awareness". The people themselves need to be educated to reject corruption.
Bulgaria and Romania have been in the news because fellow European Union member states do not want them to join the passport-free Schengen zone. While OLAF has no opinion on their readiness to join, Kessler does on the other hand have an opinion on existing levels of fraud within the EU institutions. It is, he says, "difficult" for officials to fill their pockets with taxpayer money. Fraud within the EU institutions "exists but it's difficult, it's well under control to say the least". The European Commission in particular is a "very well administered body". The commission ministries - the directorates-general - are equipped with "good means to detect signs of possible fraud", says Kessler - a former public prosecutor. "We have had some good results".
The further from Brussels you travel, he admits, the more embezzlement you will find. But here too, blame should not be placed at the door of OLAF. "We have to remind ourselves and your readers that European money is mostly spent by the member states and regions," the Italian says. When faced with evidence that Common Agricultural Fund money is sometimes spent on Ferraris or prostitutes, this is the standard Brussels response.
The image of the EU has this year been sullied again by a British newspaper sting operation. Several MEPs, the Sunday Times alleged in earlier this year, were prepared to accept cash in exchange for tabling amendments. Resignations followed though one MEP, Spain's Pablo Zalba Bidegain, was cleared in June of any wrongdoing by OLAF.
"Our aim is not necessarily to find guilt," explains Kessler. "We are investigating to discover the truth and, in this case, we think that there was nothing wrong with him." While Zalba did talk with journalists posing as consultants about tabling amendments, he did not accept any payments. "He did not commit himself. He didn't make any promises. Even less, did he accept anything, money," Kessler says. "Was he naïve? I don't care."
The journalistic sting led to an unexpected spat between OLAF and the European Parliament. The latter at first denied OLAF's right to investigate, claiming no taxpayer money was at stake. Guards were stationed outside the offices of the MEPs concerned to prevent any inappropriate investigation. "At the beginning, the President of the parliament did not recognise our competence," says Kessler. "I answered to him, and I repeat it now, he was wrong on this. We are competent in investigations on members and staff of institutions, parliament included, even beyond any possible financial interest of the EU."
This right "is set out in the internal rules of EP, which I have reminded the President of the parliament about", concludes Kessler. Investigations involving three other MEPs continue and the level of scrutiny in the future may be a lot higher, as a result.
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