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EPPO/Romania: Three individuals and five companies indicted for €1 million fraud involving IT project

July 22, 2024

  The European Public Prosecutor’s Office (EPPO) in Ia?i (Romania) has brought charges against three individuals and five companies for aggravated subsidy fraud and money laundering, following an investigation into an IT project, with an estimated damage of €1 million. Two of the suspects referred to the court of Ia?i remain in pre-trial detention.   At issue is a company that requested non-repayable EU funds of up to €2 million (RON 10 953 924), for an IT project for the development of innovative software solutions (Innovative Platform for Rapid and Secure Financial Transactions – PIST).   According to the investigation, between 2020 and 2022, the beneficiary of the project submitted false or inaccurate documents for services and goods that were never delivered or purchased, as well as employment contracts for persons who were not actually employed – thus unduly obtaining funds from the EU budget of €1 million. It is understood that these funds, paid out by Romania’s Ministry of Investment and European Projects, were subject to money laundering through domestic and international financial circuits, using shell companies registered in Bulgaria and Spain, and bank accounts in Belgium and Lithuania. According to the evidence, the shares of the Romanian-registered companies suspected of the criminal activities were transferred to Moldovan citizens and to citizens in Italy, in order to prevent potential investigations.    Under Romania’s Criminal Code, aggravated subsidy fraud is punishable with up to ten-and-a-half years of imprisonment, and up to ten years for money laundering. The five companies indicted, if convicted, could face fines of up to approximately €420 000 (RON 2 100 000), to which complementary penalties may be added.   Earlier in this investigation, in May 2024, three other suspects admitted their guilt and signed plea bargaining agreements, which were submitted to the Ia?i Tribunal.  In order to recover the damage to the EU budget and any judicial expenses, the EPPO has seized three apartments and two plots of land with a combined worth of approximately €500 000, and has frozen all bank accounts held by the suspects and their companies.   All persons concerned are presumed to be innocent until proven guilty in the competent Romanian courts of law.   The European Public Prosecutor’s Office (EPPO) is the independent public prosecution office of the European Union. It?is responsible for investigating, prosecuting and bringing to judgment crimes against the financial interests of the EU. (Source: https://www.eppo.europa.eu/)

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