Authors: Ianni Matteo – Daniele Alessandro Luison
Committe: Banking, Financial and Insurance Authorities
Date: 07.12.2023
The establishment of the EPPO, triggered by Article 86 of the Treaty on the Functioning of the European Union, signifies a paradigm shift in protecting the EU budget. The EPPO’s jurisdiction covers criminal offenses listed in the Protection of the EU’s Financial interests (PIF) Directive, complementing OLAF’s role in administrative investigations and recommendations issuance.
Distinct mandates and powers characterize OLAF’s administrative role and the EPPO’s transnational judicial authority. Despite separate jurisdictions, their operations intertwine, with OLAF often providing information leading to EPPO criminal investigations. The article delineates the internal procedural architectures of both entities.
The EU legislator’s goal is to establish an “end-to-end” prosecution cycle, integrating EPPO and OLAF powers to pursue criminal penalties and administrative sanctions. The article introduces the concept of a new “joint investigation mechanism,” emphasizing the need for coordination, information exchange, and mutual support between the two bodies.
Overlap between administrative and criminal investigations necessitates sound cooperation. The Working Arrangement between the EPPO and OLAF introduces a “complementary investigation” mechanism, allowing for parallel administrative actions to support EPPO criminal investigations. Coordination is emphasized to avoid duplication and ensure admissible evidence in national courts.
In the complex landscape of protecting the EU’s financial interests, the role of the banking system emerges as a crucial component. The banking sector plays a pivotal role in both the perpetration and detection of financial crimes, including fraud and money laundering. As the EPPO and OLAF strive to combat offenses against the EU budget, collaboration with the banking system becomes imperative. Financial institutions serve as gatekeepers, holding vital information on transactions and assets linked to potential criminal activities. Effective cooperation between investigative bodies and the banking sector is essential for tracing funds, uncovering illicit financial schemes, and ensuring the overall integrity of the EU financial system. The integration of banking institutions into the collaborative framework established by the EPPO and OLAF further strengthens the “end-to-end” prosecution cycle, enhancing the ability to track and recover misappropriated funds while fortifying the resilience of the EU’s financial infrastructure against fraudulent activities.
Article 101(3) of the EPPO Regulation exemplifies the EU legislator’s intent to create a combined system enhancing the effectiveness of prosecuting offenses against the EU budget. The collaboration between EPPO, OLAF, and the banking system, guided by the Working Arrangement, establishes a sophisticated “EU joint investigation mechanism.” This mechanism not only optimizes prosecution efforts but also significantly improves the recovery of funds, marking a substantial advancement in EU financial protection. The inclusion of the banking sector as a strategic partner adds another layer of depth to the collaborative framework. The banking system’s role as a key player in the detection and prevention of financial crimes amplifies the ability to trace and recover misappropriated funds, fortifying the resilience of the EU’s financial infrastructure against fraudulent activities. This integrated approach ensures a comprehensive response to financial offenses, underscoring the EU’s commitment to maintaining the integrity of its financial interests.