Cyprus linked to international fraud and money laundering scheme

Cyprus may be embroiled in a €15 million international fraud and money laundering scheme, suspected of obtaining EU funds for IT projects with false invoices, two EU bodies revealed on Thursday.

Statements from the European Anti-Fraud Office (Olaf) and the European Public Prosecutor’s Office (Eppo) said their joint investigation has uncovered an international fraud scheme in Romania believed to have “syphoned millions of EU funds through fake or incorrect invoices and then tried to launder the money.”

The investigations also concerned legal entities and persons based in Cyprus, Czechia, as well as Malta, Monaco, and the United States, Eppo underlined.

It added 38 house searches were carried out on Tuesday across Bucharest, Ploiești, Cluj and Ialomița County.

Ville Itala, director-general of Olaf said “we have analysed and tracked down a likely money laundering scheme at international level.”

An Olaf spokesperson told the Cyprus Mail they could not share more details so as not to hamper the investigation.

Central to the case however, are six IT projects financed by the EU, for the development of innovative software solutions. They were aimed at ssupporting innovation and fostering productivity.

According to the investigation, between 2019 and 2022, the beneficiaries of the projects submitted false or inaccurate documents with overvalued services or services that were never provided.

Eppo said the beneficiaries also submitted fraudulent invoices for the purchase of goods, thus “unduly obtaining funds from the EU budget of at least €15 million.”

The beneficiaries are suspected of having subsequently created false domestic and international financial circuits, so as to channel the funds for their own benefit.

Some of the people under investigation have been brought to Eppo’s office in Bucharest to “be informed of their status as suspects, and others will be brought in during the coming days,” Eppo added.

Cyprus’ police spokesman Christos Andreou said he had no information he could divulge on the matter. The local Eppo office was not immediately available for comment.

The facts under investigation could constitute offences of fraud and money laundering, Eppo highlighted.