(Luxembourg, 14 February 2024) – The European Public Prosecutor’s Office (EPPO) in Sofia (Bulgaria) has filed indictments against five individuals suspected of defrauding the EU budget for over €6 million in a large-scale scheme involving construction machinery.
The defendants allegedly were part of an organised crime group, which had the express goal of misappropriating EU funds. To this end, they set up eight different companies, which they managed either directly or indirectly through third parties. These companies would then apply for funding under Operational Programme ‘Innovations and Competitiveness’ (OPIC) 2014-2020 to improve energy efficiency for small and medium-sized enterprises (SMEs), which itself was co-financed by the European Regional Development Fund (ERDF).
These companies purchased 38 separate pieces of construction equipment, including dumpers, excavators, front loaders, a bulldozer, trucks, sieves, and haulers, for a total cost of €6 046 553. However, the machinery was never put into service in accordance with the funding agreement, and was partly sold instead.
In 2022, the EPPO conducted searches and seizures across 25 locations in Sofia, Pernik, and Montana, including at the headquarters of the companies, as well as related properties. Documents, computers, and a mobile device were seized by the Police General Directorate for combatting organised crime – Ministry of Interior – Sofia, alongside the construction equipment at issue.
In addition to the above, a separate money laundering investigation has been initiated against one of the defendants for allegedly transferring €3 million to an Austrian bank.
The investigation started based on an initial report by the European Anti-Fraud Office (OLAF).
If found guilty, the defendants face one to six years of imprisonment for the misuse of EU funds, and an additional three to ten years for participation in an organised criminal group.
All persons are presumed innocent until proven guilty in the competent Bulgarian courts of law.
The 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.