- Top anti-mafia investigator Vallone speaks to Bloomberg.
- Crime gangs target firms best-placed for EU windfall.
- Italian mafia trial could expose underbelly of massive EU fraud.
- Corona-mafia? Organised crime setting sights on EU Recovery Fund, experts warn.
- SCANDALOUS CORRUPTION BY THE European Union HEALTH COMMISSIONER Stella Kyriakides
How the Italian Mafia Is Targeting Europe’s
Crisis Recovery Fund
By and 
Maurizio Vallone in Rome, March 2. Photographer: John Follain/Bloomberg
Criminal enterprises -- like their legitimate counterparts -- have suffered during the pandemic-induced economic crisis. But the Italian mafia has already laid the foundation for a massive payday.
Last year, when countries were seized by lockdowns, the mafia started infiltrating cash-starved companies in a bid to siphon money from the European Union’s recovery fund and the 1.8 trillion euros ($2.2 trillion) that will, in part, start flowing to struggling firms later this year, according to Maurizio Vallone, Italy’s top investigator on organized crime.
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Welcome to day 3 of #EUCO on #MFF and Recovery Fund @eucopresident started meeting just now with Chancellor Merkel @RegSprecher and president @EmmanuelMacron and @vonderleyen pic.twitter.com/uPfWfQAO5U
— Barend Leyts (@BarendLeyts) July 19, 2020
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SCANDALOUS CORRUPTION BY THE #EuropeanUnion HEALTH COMMISSIONER | May 6
Stella #Kyriakides's team
— Graviola Finland (@GraviolaDOTfi) May 21, 2021
Stella Kyriakides's team supports her in her daily work.
Email: cab-kyriakides-contact@ec.europa.eu
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Criminal groups including the N’drangheta in the southern Calabria region and Cosa Nostra in Sicily have sought to gain footholds in lawful businesses that will be first in line to get EU aid, such as those in environmental and digital sectors, said Vallone of the Antimafia Investigative Directorate, which groups investigators from the main police forces.
https://upload.wikimedia.org/wikipedia/commons/thumb/7/7a/Struttura_ndrangheta_2011.jpg/800px-Struttura_ndrangheta_2011.jpg
https://www.fbi.gov/investigate/organized-crime/history-of-la-cosa-nostra
The mafia has been choosing the companies that are best-placed to take part in recovery fund tenders, especially in the health and infrastructure sectors where a great deal of money will be spent,” Vallone told Bloomberg at his Rome office on Tuesday. “It will try to take everything. We have to make sure they don’t get even one euro.”
Covid Impact to Mafia
Pandemic changed mafia crime framework
Source: DIA
And Italy is a prime target for criminals since it’s poised to be the largest recipient of EU grant money.
The new government of Prime Minister Mario Draghi is drafting a spending plan for its 209 billion-euro share of the EU funds as it struggles to shake off the worst recession since World War II. Italian firms are particularly vulnerable since a scheme for state-guaranteed bank loans has been too complex and limited to be effective, said Vallone.
As a result, companies that have shaky credit-worthiness have benefited little from state help, he said.
Mafia gangs have seized on the opportunity, with regional and national lockdowns, to reach out to small and medium-sized companies desperate for liquidity in an economy that contracted 8.9% last year.
Mafiosi typically seek to muscle in on a firm’s share capital, fund struggling businesses through usury, or exploit them through a hidden partner, Vallone said. The number of suspicious financial operations reported by the Bank of Italy increased by 7% last year to 113,000. “That makes us strongly suspect that there is organized crime interest,” he said.
The European Anti-Fraud Office, called OLAF, will screen spending plans by member states to ensure they meet control and anti-fraud requirements, and will in the future carry out investigations of its own, according to a spokeswoman. The organization will also team up with national authorities and partners including Europol.
New Checks
Vallone wants tighter anti-mafia checks on public works. Under the current system, police forces assess the winner of a tender before a project begins. Under a proposal Vallone said he will send to the interior ministry later this month, anti-mafia investigators would automatically monitor money transfers as well as sub-contractors and suppliers for the duration of the project.
“The recovery fund is the priority, but this procedure should apply to all public works contracts,” Vallone said.
Stricter rules are needed also because of pressure from Brussels. “The European Commission doesn’t wait for the biblical time-spans of traditional public tenders, it wants to give the money and see the results within a reasonable period,” said Vallone.
There may well be a downside to more anti-mafia checks however. Italy, plagued by red tape, already fails to spend much of the structural funds it receives from the EU. The country had used only 30.7% of allocated funds at the end of 2019, according to an EU report, compared to 66.2% for leader Finland, and an average for the bloc of 39.6%. More controls could risk stalling recovery money too.
‘Crazy and Hypocritical’
In the Sicilian capital Palermo, many are facing a stark choice, according to Patrizia Di Dio, head of the local, 13,000-strong branch of the Confcommercio business lobby.
“When a businessman cannot any longer support even his own family, he’ll find organized crime ready for him with its doors wide open,” Di Dio said. “If the state wants to protect the legal economy, it should make loans more accessible, and it should suspend taxes. It’s crazy and hypocritical not to help you, and to threaten you with taxes at the same time.”
— With assistance by Viktoria Dendrinou, and Giovanni Salzano
https://www.bloomberg.com/news/articles/2021-03-04/the-mafia-plans-eu-recovery-fund-heist-amid-drop-off-in-crime
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Parliamentary questions | 22 Mar #Europol: #Mafia plans to intercept #EURecoveryFunds heading for #Italy.
— Graviola Finland (@GraviolaDOTfi) June 12, 2021
The Italian Anti-Mafia Investigation Directorate: 'number of suspicious financial operations reported by the #BankofItaly increased by 7 % last year' https://t.co/lkzr0plP0g pic.twitter.com/ua6zDnKpBi
https://www.europarl.europa.eu/doceo/document/E-9-2021-001532_EN.html
https://direzioneinvestigativaantimafia.interno.gov.it/
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Italian mafia trial could expose underbelly of massive EU fraud
MESSINA, Italy — 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.
Four years in the making
The massive public trial is the culmination of four years of investigative work that burst into public view 13 months ago, when roughly 1,000 police officers raided scores of suspected mafia members.
The arrests took out much of the hierarchy of two major mafia clans — the Battanesi and the Bontempo Scavi. Both groups are distinguished by their colorful nicknames. There’s Blondie, Banger and Vito Corleone, named after Marlon Brando’s character in “The Godfather.” And the alleged boss of the Batanesi clan is Sebastiano ‘Swagger’ Bontempo.
Based in the Nebrodi mountains, a protected area covering 860 square kilometers, the mafia families are “characterized by strong family ties, violence and brutality,” the arrest order said.
The two clans share power in the village of Tortorici, the hometown of the bombmaker who laid the explosion that killed Italy’s most famous martyr, anti-mafia prosecutor Giovanni Falcone.
This division of power has not always worked smoothly. There was a bloody turf war in the 1980s and 1990s, which left more than 40 people dead. But the two groups have since allegedly put their differences aside in their joint aim of defrauding the EU.
Prosecutors say the two groups cooked up a scheme to identify plots of land where EU funds had not yet been claimed. Officials working at local government agencies helped track down these plots, accessing the land databases in exchange for cash. The coordination with officials reduced the risk of duplicate subsidy requests for each land plot.
The mafiosi then allegedly created a fake rental contract, or forced the landowner to sign a rental contract, appropriating the land, which they often did not bother to farm.
Some funding applications were made for land which was not farmland, or not actually owned or leased by the applicants at all, including a plot owned by the Catholic Church and another on which a railway had been built, according to the indictment. Other suspect land plots included one that the U.S. navy used to host satellite communications
Any disagreements between the two mafia clans over these plots were resolved via mediation.
Since the arrests, three of the accused mafia members have turned state’s witness, according to investigators, providing new evidence suggesting the fraud goes back to the 1990s.
In the courtroom
Piera Aiello, a member of parliament who married into the mafia but turned state’s witness herself in the 1990s, was there to witness the start of the trial on Tuesday.
Aiello has become an advocate for those who collaborate with the justice system, but looking at the cages lining the courtroom, she remarked to POLITICO how difficult the task will be for the informers in the trial.
“It is one thing to go against one mafioso, but to go against 100?” she said. “It is such a hard moment to look into their eyes and point the finger at the mafia. Your heart tremors.”
Authorities in Italy first became conscious that mafia clans were abusing EU subsidies around 2012, when Giuseppe Antoci, a former president of the Nebrodi region, mandated background checks for those applying for funds. The move made Antoci a mafia target, and he faced an assassination attempt in 2016 —the most high-profile attack on an institutional figure since the 1990s.
Antoci now lives under 24-hour armed guard, but he also showed up to the courthouse on Tuesday, defiant.
“I want to look in the eyes of those who have for decades held this land hostage,” he said.
The victims, he said, are not just the EU and taxpayers, but the community and local residents missing out on funds — “farmers, young people who want to start a business, who want to find an opportunity to stay in their hometown,” he said. “The EU money needs to go to these people.”
Lawyers for the defendants said their clients maintained their innocence, arguing they had been the victims of a miscarriage of justice.
Alessandro Pruiti Ciarello, the lawyer for nine defendants, said that these maxi trials are “less fair” for the defendant as group responsibility is established without necessarily proving the specific involvement of each individual.
“They do not have to show individual responsibility,” Ciarello said. “Often some big fish goes free and some little fish is condemned.”
As the first of its kind in Europe, the trial could serve as a blueprint for other regions of Italy and countries.
The Greens group in the European Parliament this week released a report detailing the misuse of European agricultural funds in five Central and Eastern Europe countries. And a Slovakian journalist, Jan Kuciak, was killed in 2019 while investigating Italy’s Ndrangheta mafia for defrauding the EU.
Investigators concede their findings are likely only the tip of the iceberg.
The maxi-trial, said Giarrusso, the anti-mafia advocate, is “a warning” to the mafia: “It shows we can fight this phenomenon.”
https://www.politico.eu/article/italian-mafia-trial-could-expose-underbelly-of-massive-eu-fraud/
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Corona-mafia? Organised crime setting sights on EU Recovery Fund, expertswarn
By Euronews
Executive Director at Transparency International Italy Davide Del Monte speaking on Good
Morning Europe on September 18, 2020 - https://www.euronews.com/embed/1232730
Europol's Executive Director Catherine De Bolle warned on Tuesday that mafia organisations in Europe may attempt to get their hands on the coronavirus EU Recovery Fund - urging member countries to monitor where such money goes to.
In Italy - which is receiving the largest share of the fund, €209 billion - experts are urging authorities to keep "their eyes open".
"The mafia is waiting for all this money to flow into the Italian economy," says Davide Del Monte, Italy director at Transparency International, as "the appetite of organised crime always follows the money".
Del Monte explains such organisations use sophisticated methods to cover their illicit activities.
"Last year the mafia created a lot of business firms in the legal economy, because it has the power to collect money through crimes like drug and weapon dealing, and to reinvest this huge amount of money into the 'real' economy."
"They use trust funds in Luxembourg, they open bank accounts in the UK or in the Netherlands, and then open business firms all over Europe."
“Construction, logistics as well as food and drinks” are the worst-affected sectors, Del Monte says.
But organised crime is not only an Italian problem, he argues: "We must fight it all together with stronger rules and practices in all the European countries".
“We need to reinforce international cooperation between law enforcement agencies and public prosecutors' offices" as well as "support and protect investigative journalists”, he adds, “that’s the first barrier, the first firewall against the mafia."
“Finally we need to create a European legal framework that is able to fight back organised crime".
Watch the full interview with Davide Del Monte in the player above.
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