Italian mafia trial could expose underbelly of massive EU fraud
05 Mar 2021

In a bunker-style courthouse tacked onto a prison, close to a hundred suspected mafiosi and their accomplices are standing trial, accused of defrauding the EU out of millions of euros.

The so-called maxi-trial is expected to reconstruct, for the first time, an integrated system through which prosecutors say mob clans and their associates targeted the €55 billion in farm subsidies the EU pays out annually.

It’s a scheme that officials claim involved not just the mob, but white-collar accountants, politicians and government employees, leading to at least €10 million in stolen EU agricultural funds. And it’s a moment that reflects the diversification of criminal organizations in southern Italy, where groups have evolved from traditional activities of drugs and extortion to tapping more profitable and less high-risk income streams — including EU grants meant to support farmers.

The proceedings are likely to last at least a year, with 97 defendants, 90 lawyers and up to 1,000 witnesses, with a number of state’s witnesses prepared to break their omerta, or code of silence. On Tuesday, when the trial started, it took more than an hour for the roll call of defendants, who are accused of crimes including fraud, false statements, extortion, creating fake companies for illegal gain, drug pushing and stealing livestock.

“A colossal fraud,” the investigating judge proclaimed in a pre-trial charge sheet, “exploiting the EU funding on a huge scale and to perfection.” It was, the document declared, “a devastating phenomenon. A mafia ready to take on Europe using illegal methods, and an [Italian] state that is already behind and playing in defence.”

Sitting in court, Italian Senator Mario Giarrusso, a veteran anti-mafia campaigner, reflected on the moment, calling it “extraordinary and symbolic.”

With the trial, he said, the public can now “reconstruct the mechanisms used systematically by the mafia and white-collar officials.” And, he added, it represents a significant shift in how the Italian courts are treating fraud.

Until now, improperly claiming EU subsidies had been treated as simple fraud in Italy, a crime that often goes unpunished due to drawn-out court proceedings. But now that prosecutors are approaching it as a mob scheme, Italy’s tough anti-mafia laws mean some defendants could face up to 25 years in prison.

“This is the major new development revealed in this trial — an integrated, organized system” of subsidy fraud, Giarrusso said.

The case is also topical given the €209 billion windfall Italy is expected to receive as part of the EU’s post-pandemic recovery fund. While the trial could alarm people by exposing the depths of EU graft within Italy, it may also serve as an opportunity to show EU leaders the country is serious about preventing criminals from skimming off the top.

By Hannah Roberts, Politico, 4 March 2021

Read more at Politico

RiskScreen: Eliminating Financial Crime with Smart Technology

Count this content towards your CPD minutes, by signing up to our CPD Wallet

FREE CPD Wallet