Fraud represents a major problem for the European Union where political elites in some member states sap EU funds for their own benefit. The Czech Republic and Hungary appear to be among the “champions”.

Czech Prime Minister Andrej Babiš is under a criminal investigation regarding the finance of his company and his Hungarian counterpart, Viktor Orbán, is under investigation for allegations of corrupt activities committed by friends and family.

But the EU faces corruption problems in other member states as well. And since corruption is strictly connected with politics, the entire environment represents a direct threat to the rule of law.

Hungary, for instance, is under severe scrutiny not only by the EU anti-fraud institution, OLAF, but also by the sister parties of Fidesz, a member of EPP.

European Interest interviewed Ingeborg Grässle, the Chair of the Committee on Budgetary Control of the European Parliament, on the Czech and Hungarian cases as well as on her proposals to fight money laundering in Europe.

A major problem in pursuing fraud and money laundering cases in the EU member states represent the action of some national courts that impede the job of the EU.

According to the German MEP, the problem will be resolved after the European Public Prosecutor’s Office becomes operational in 2020. The EPPO’s duty will be to go to the national courts with European fraud and money laundering cases and act without consent of the national state.

Grässle said also that Viktor Orbán and his party found a new political friendship with Italian far-right leader Matteo Salvini and that in front of the emerging anti-EU campaign the pro-European forces must be more active.

European Interest: Ms President, the Czech case of conflict of interest represents one of the major cases of corruption in the European Union. Recently you warned that “the credibility of the entire EU is at stake”. Can you please explaine?

Ingeborg Grässle: The revised Financial Regulation (new provision in Art. 61) asks the Commission to take action – that is what it does. Commissioner Oettinger wrote a very clear letter to the Czech Prime Minister (which has been leaked in the meantime) with an unequivocal message: if he wants to receive EU money for projects of his companies he has either give up his political career or give up his companies. We are now awaiting an answer from the Prime Minister.

“Commissioner Oettinger wrote to the Czech Prime Minister: if HE wants to receive EU money for projects of his companies he has either give up his political career or give up his companies”

What instrument does the EU have to punish fraudsters and claim back EU taxpayers’ money illegally obtained by the Czech company?

The EU’s rules have always been very clear – 100% recovery of the funding for those projects affected by fraud. To act legally in a proper way, the Commission needs rulings from the Member States’ courts on those fraud cases. This is also the prerequisite for the Commission being allowed to put the name of the affected companies in the exclusion database, the so-called EDES.

What instruments does the EU have to press the countries to act according of the rule of law?

We see that in some Member States we have severe deficiencies regarding the rule of law, because acting politicians may interfere in police enquiries and judicial proceedings on fraud cases. For those countries which do not take up own fraud cases or OLAF cases to bring them to court and punish fraudsters, the Commission put forward a Rule of Law Regulation, which we voted on Thursday 17 January (report Gardiazabal Rubial/Sarvamaa). This presents an important opportunity to close a severe loophole that is growing bigger and bigger – also with regard to those countries which do not participate in the EPPO, the European Public Prosecutor’s Office, operational from 2020 onwards. The EPPO’s duty is to go to the national courts with European fraud and money laundering cases; the first European body able to act without consent of the Member State!

Another case involves Hungary and the investigations concerning the prime minister’s entourage. In this case, we have witnessed an unprecedented attack of the ruling political party against the entire ‘package’ of EU values: transparency, rule of law, human rights, lack of solidarity etc. Why does the EU seem so weak in its response against the Hungarian government? Is this an issue of credibility for the EU?

If we compare the reputation of the Hungarian government 1.5 years ago and now – in the EU – , I have to state clearly that it is more and more isolated. Nobody in Germany, not even the CSU, would invite Mr. Orbán now for their meetings. He chose new friends, Mr. Salvini, and never has Fidesz been as close to being excluded from EPP as now. The Hungarian government does not do European politics, but only domestic politics. Like every authoritarian regime, it needs an ‘external enemy’, a role which is given to the EU. One of the most corrupt governments in the EU builds up a bugbear to hide those machinations… I am sure that the Hungarian citizens understand what is happening.

“Nobody in Germany, not even the CSU, would invite Mr. Orbán now for their meetings. He chose new friends, Mr. Salvini, and never has Fidesz been as close to being excluded from EPP as now”

The rule of law is under threat, not only in the Czech Republic and Hungary, but in other EU member states. Do you think Parliamentary Groups should suspend membership of the governmental parties during the period of the investigation?


Recently, we have witnessed an orchestrated questioning of the EU’s authority. A few days ago, the leader of the Polish ruling party praised the courage of far-right Matteo Salvini to confront Brussels. Are you concerned of the rapprochement of Eurosceptics and far-right politicians? Will the EU be able to continue without compromising with them after the elections?

We should say ‘no’ to all tentative to destroy our Union, whoever undertakes them. The pro-Europeans need to take more action. I am confident that citizens will do the right thing against the destroyers, who have no idea how to go ahead successfully together. Together we are stronger, don’t forget!

You are a fervent supporter of the introduction of a maximum limit for cash payments. This would be €5,000. Your aim is to reduce money laundering. But isn’t it necessary for such a proposal to be adopted by all member states in order to ensure it is effective?

It is important that big payments leave ‘a trace’. Maximum limits for cash payments will not solve all problems of organised crime, but some. We see that Germany is a target country for black money, as even flats can be paid cash. The Greek crisis and now the Italian crisis leading to a massive influx of money looking for a ‘safe harbour’ – investments where nobody asks questions. An EU-wide limit for cash payments is not necessary if Member States take action. Perhaps – and here you are right – this EU-wide cash payment limit is the only way to have progress. In the meantime, it would be useful to have an EU-wide compulsory register for real estate bought by EU citizens in other Member States. When you open a bank account in an EU country, of course your treasury at home gets informed. You buy real estate – and nothing happens…