BusinessCompany NewsEC reforms target fraud prevention

EC reforms target fraud prevention

European Commission president Romano Prodi has announced a string of reforms designed to further toughen his organisation's ability to fight internal fraud and mismanagement.

Link: Prodi comes out fighting for Eurostat

Stung by criticisms following the Eurostat scandal that he failed to deliver on his goal of squashing European Union financial misconduct, he told the European Parliament’s budgetary affairs committee that the commission would increase the political responsibility of commissioners for the actions of their officers.

Prodi said a procedure would be introduced telling departmental director-generals to alert their commissioner to any fact or development for which they might have political responsibility.

This follows claims by commissioners that they were left unaware of the accounting irregularities at Eurostat. Prodi added that a new early warning system would be established for ‘collecting and cross-checking all information relating to allegations of fraud, irregularities or wrongdoing’.

The commission president also called on EU anti-fraud agency OLAF to focus on larger cases, passing on less important allegations ‘to the appropriate authorities’. He added that there should be a better flow of information between OLAF and institutions under investigation ‘so that these will be better able to take precautionary measures’.

These proposals raised criticism from the committee, however, with Spanish conservative MEP Juan Jose Bayona De Perogordo accusing the commission of shifting responsibility for the Eurostat affair onto OLAF, ‘like a thief accusing the police of not having watched him closely enough’. Belgian Green MEP Bart Staes said the fact the scandal was highlighted by whistleblowers showed that the commission ‘had failed terribly’.

Separately, the Commission has announced that it is splitting its Internal Audit Service into two distinct directorates, one carrying out audits and the other responsible for resources, coordination and communication. It justified the move because of new duties to audit the majority of EU agencies and from next May’s accession of new member states.

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