The European Union is vulnerable to agricultural fraud and illegal land grab

Photo by David Bartos/Pixels

The European Council of Auditors warns: There is a lack of digital technologies to prevent the illegal use of funds under the Common Agricultural Policy.

Fraud risks in agricultural subsidies under the new Common Agricultural Policy (CAP). The warning comes from the European Court of Auditors (ECA), which has published a report on the risks of illegal use of funds to support farms.

The document highlighted previous cases in which applicants did not disclose basic information or created artificial conditions to meet the eligibility criteria for financial assistance unjustifiably.

According to the auditors, these control gaps still exist and make the CAP vulnerable, allowing for illegal land grabs and subsidies. The European Commission has therefore been asked to invest in digital technologies capable of preventing and detecting these illegal practices.

spread of illegality

According to data provided by the European Anti-Fraud Office (OLAF), the financial impact of fraudulent violations reported in the CAP in the period 2016-2020 was equal to 0.09% of the total expenditures, equivalent to 262 billion euros.

One of the main risk concerns is the issue of land grabbing, which leads to the concentration of farmland and subsidies in the hands of large corporations and investors, especially in mountainous regions and in Eastern European member states.

This phenomenon often includes practices such as document falsification, coercion, the use of political influence or inside information, or even the tampering of procedures or the payment of bribes.

Surface checks

According to Nikolaos Milionis, the CEC member leading the review, he said the DGDA “did not adequately deal” with the land grab, as Brussels would consider it up to member states to resolve it.

“Because CAP control systems make it difficult to overestimate the eligible area, scammers often target land that has no active owner,” the auditors explained, adding that these cases include land that is publicly owned or owned by individuals but whose ownership is not. It is clear and well defined. The report highlights that the legislation does not define the concept of “land available to farms,” ​​according to Europa Today.

skill question

Auditors criticize that this is a matter of legislative competence of member states, and not of an EU-wide regulation. “It is critically important to work on land acquisitions to ensure that CAP funds reach the rightful beneficiaries,” the reporter’s auditors said. They added that this issue “should not be seen as a purely national jurisdiction (regarding land ownership and control), where land grabs are used to divert EU funds from their original objectives and weaken the CAP.”

The judges recently ruled that when the land is claimed by the owner and a third party uses it without legal grounds, the land is considered available to the owner.

Complexity facilitates fraud

Auditors caution that the risk of fraud is directly proportional to the complexity of the SOP. And the more bureaucratic this was, as small farmers often complain, the more they were deceived. According to the auditors, the worst problems are found in rural development and specific market actions.

For this reason, they made a number of specific recommendations: “In particular, the Commission should clarify the role of certification bodies in evaluating anti-fraud measures for paid agencies and review how paid agencies implement the new guidelines to check whether it is legally available to farms.”

Effective techniques

The other suggestion concerns Introduce techniques for more effective monitoring of potential illegal schemes. Particularly mentioned: a fraud detection tool called Arachne, which shares best practices in artificial intelligence and machine learning to identify the most common deviation patterns.

“Strong control systems help, but we also need to develop a more proactive approach to fraud detection,” the auditors said. The auditors are calling on Brussels not only to act on reported or media-focused cases, but to foster a “culture of surveillance” supported by these new technologies, in order to “monitor progress and release corrections where deficiencies are found.”

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