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Currently, the EC lacks comprehensive information on the scale, nature and causes of fraud. This hinders the effective prevention of fraud against the EU budget, say the auditors.
Fraud is a hidden and complex phenomenon and protecting the EU’s financial interest against fraud requires comprehensive and systematic efforts. This is a key responsibility of the European Commission. The auditors assessed whether the Commission is properly managing the risk of fraudulent activities that are detrimental to the EU budget. In particular, they looked at the information available on the scale, nature and causes of fraud in EU spending. They examined whether the Commission’s strategic risk management framework is effective and whether OLAF’s administrative investigations lead to prosecution and recovery.
The auditors found that the EC lacks comprehensive and comparable data on levels of detected fraud in EU spending. Moreover, it has not so far carried out any assessment of undetected fraud, nor detailed analysis of what causes economic actors to engage in fraudulent activities. This lack of knowledge reduces the practical value and effectiveness of the Commission’s plans to protect the EU’s financial interests against fraud, say the auditors.
To achieve better results in tackling fraud against the EU’s financial interests, the auditors recommend that the EC should:
• put in place a robust fraud reporting and measurement system, providing information on the scale, nature and root causes of fraud;
• clearly refer to fraud risk management and prevention in one Commissioner’s portfolio and adopt a renewed anti-fraud strategy based on a comprehensive risk analysis;
• intensify its fraud prevention activities and tools; and
• reconsider OLAF’s role and responsibilities in light of the establishment of the EPPO and propose giving OLAF a strategic and oversight role in EU anti-fraud action.