The MAFIA and the EU

EU anti-fraud investigators found widespread “irregularities” surrounding repairs and upgrades to a stretch of the A3 motorway between Salerno, south of Naples, and Reggio-Calabria, on the toe of the boot-shaped peninsula.

The huge refund from Rome is the largest in the EU’s history, deepening Italy’s budget deficit at a time of turbulence on the financial markets and concerns that the Italian state is not in control of its finances.

It accounted for over half of the £555 million of detected and recovered fraud in the EU’s budget last year. (2012)

The Salerno-Reggio Calabria autostrada has been dogged by corruption allegations for years and is seen as a symbol of the enormous challenges facing the ‘Mezzogiorno’ – Italy’s southern half.

The investigation found that more than 381 million euros was lost through fraud, fake contracts and ghost road works.

The region of Calabria, through which the motorway passes, is notorious for its ‘Ndrangheta mafia, an organised crime syndicate which is now regarded as being more powerful than the better known Cosa Nostra of Sicily.

Italian investigations into mafia-related fraud are continuing, meaning that details of the EU’s biggest funding disaster are still sketchy.

“The sum has been formally recovered following investigations focusing on two separate intervention programmes, spread over several years, but all concerning the Salerno-Reggio Calabria autostrada,” said Giovanni Kessler, the head of the EU’s anti-fraud investigator, Olaf.

“This money had already been spent, so the Italian state is obliged to give it back to the EU with the burden subsequently falling on taxpayers.”

What has raised eyebrows, though, is how Brussels has been willing to hand over vast sums to Calabria and other Mafia-plagued regions of Italy over the years, despite the very real risk of taxpayers’ cash ending up in Mob hands.

Since 2007 alone, the EU has authorised some €3 billion to Calabria alone, ostensibly to develop one of Italy’s most backward and isolated areas. Yet hefty slices of that cash are thought to have gone to the Mafia, which is thought to have taken “pizzo”, or Mob tax, on the building of everything from roads to windfarms.

“We have seen this kind of fraud ever since huge amounts of public money started to arrive down here in southern Italy,” local anti-mafia magistrate Roberto Di Palma, who has conducted 25 inquiries into misuse of EU funds, told The Sunday Telegraph.

“The ‘Ndrangheta is like an octopus, and wherever there is money, you will find its tentacles.”

ITALY’S Mafia groups have a bigger annual budget than the European Union, the country’s foreign ministry has claimed. (2014)

Giovanni Brauzzi, security policy director at the ministry, claims the Mob’s annual income has passed the €200bn (£166bn) mark compared with the total EU spend of €140bn (£116bn).

His estimate marks a 43 per cent increase from the figure produced by the Confesercenti, an organisation of Italian businesses, which in 2012 claimed that the Mafia generated an annual turnover of €140bn (£116bn).

The Confesercenti report described the Mafia as the “biggest bank” in the country with €65bn in liquidity and said a growing number of small and medium sized businesses were coming into contact with the Mob.

Experts have warned that Italy’s brutal recession, combined with its banks’ reluctance to lend money, has left more and more businesses turning to organised crime for help.

Speaking at a conference in Brussels this week, Brauzzi said that crime syndicates in Italy had also begun to shift their “investments” overseas, with just 10 per cent of their budget still parked within the country. “The rest they invest in countries in Europe and elsewhere,” he said. “They have good friends everywhere.”

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