fraud case uncovered
Tomato gang rakes in fat EU money without ever growing a tomato
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They received €850,000 in EU subsidies to grow tomatoes, but their tomato plantations didn’t exist at all. Now a gang from Romania and Italy has to go to court.
Shell companies are a well-known evil in the field of white-collar crime. What the EU anti-fraud authority “Olaf” has now uncovered should be described as a case of mailbox plantations. Because the tomato plantations, with which a gang of fraudsters has swindled EU agricultural subsidies on a large scale, only existed on paper.
After years of investigation, the authority is now bringing the tomato scammers to court in Romania. Five people from Italy and four Romanian companies are accused of having secured 850,000 euros from EU funds intended for growing tomatoes. The sum corresponded to about a quarter of the total subsidies that flowed into Romanian tomato cultivation in 2017. But the gang never planned to plant even a single tomato, the EU investigators explain.
Not spent a penny on tomatoes
Together with Romanian and Italian authorities, a number of potentially fraudulent practices have been uncovered. The gang used false documents, bogus companies and fake property declarations to get the money. The string pullers were apparently in Italy: when the grants were paid, they were immediately transferred to bank accounts in Italy and withdrawn to finance other criminal activities. “Not a single cent appears to have been spent on agriculture or in Romania,” the investigators write. The same group may have used similar tactics in Romania before.
Ville Itälä, head of the anti-fraud agency Olaf, praised the work of his investigators and the cooperation with the national authorities involved. “Olaf’s job is to ensure that EU funds reach the intended recipients so that they can benefit society,” Itälä said.
The case of the imaginary tomato plantations may sound strange, but it points to a general problem. Year after year, the EU distributes billions in agricultural subsidies and not everything is used transparently. Just last year, the Greens in the European Parliament published a study denouncing the massive abuse of agricultural subsidies in Eastern Europe. According to the study, corruption, nepotism and bureaucracy prevail in many places in Bulgaria, the Czech Republic, Hungary, Slovakia and Romania. As a result, a few large, government-related companies often enriched themselves.
Sources: Olaf / Green study