More police resources need to be dedicated to helping investigations into major fraud cases impacting the EU’s budgetary interests, the chief prosecutor has advised Malta.

Laura Kövesi, who heads the European Public Prosecutor’s Office (EPPO), was in Malta last week for talks on the problem with the Justice Ministry and Police Commissioner Angelo Gafa.

In comments to Times of Malta, Kövesi said that while detection and reporting of potential cases has improved, EPPO’s two Maltese prosecutors needed more police support to handle their investigations.

“I came here to discuss a plan to develop this further. It is important to be consistent and efficient. Yes, the level of crime detection has increased, but this should not be random or because I came and criticised the authorities,” Kövesi said.

Two years ago, Kovesi had stiff words about the way Maltese investigators passed the buck on who was responsible for probing EU fraud cases.

‘Few’ police on probes

Kövesi said that while the situation has improved, she gets a sense that police still draw a distinction between their cases and EPPO cases.

“EPPO is not a foreign institution. I fear there is a distinction between ‘their cases and our cases’. No, EPPO is embedded in Malta. The two delegated prosecutors work here and prosecute cases in the Maltese court,” Kövesi said.

She said that while there are “a few” police officials who have been officially designated to work on EPPO cases, this has to be done while the same officers juggle their own caseloads in parallel.

“This problem with the resources should not be so complicated. I can understand there are not enough police officers, but the idea is to have a plan and establish how to deal with this”.

It is important that the EPPO team is not left alone, she added.

She said some other countries have gone for a model where police officers are embedded full-time within the local EPPO office.

The chief EU prosecutor argued that EPPO is the best possible tool to ensure countries have bigger budgets and more resources available to them, as its main role is to detect VAT and customs fraud.

“The last estimates put VAT fraud at €50 billion, year after year, for decades. With EPPO, you can reduce that gap, and if we do that, it means more money in governments’ pockets.

“In two years of operations, we have seized €700 million, money that will go directly back to the budgets of EU member states. If we seize a lot of money in Malta, this money will go back into the Maltese budget.”

Kövesi also pointed out flaws in the way Malta legislators had adopted the EU’s regulations governing EPPO’s functions.

The situation has seen EPPO investigators effectively locked out of magisterial inquiries, which take place in secret.

“Our delegated prosecutors must lead the investigation, not the magistrate. It is in the regulations,” Kövesi said.

Times of Malta revealed last year how an EPPO probe into the €40 million Marsa junction project faced obstacles, as both the police and an inquiring magistrate refused to hand over data from murder suspect Yorgen Fenech’s phone.

Fenech was promised €2 million in success fees for helping a Turkish bidder on the verge of bankruptcy win the Marsa bid.

Kövesi said the authorities have told her amendments to the law have been presented to parliament.

EPPO publicly highlighted these “implementation gaps” in March.

Justice Minister Jonathan Attard presented a draft law to increase EPPO’s power in December 2022, only to withdraw the bill from parliament the following month.

‘A complex case’

Kövesi said collaboration between EPPO and the police had led to arrests in a “complex case” involving many suspects.

In July, EPPO announced that eight people had been arrested in connection with customs fraud and corruption of public officials.

Investigators suspect a fraudulent scheme designed to evade the payment of customs taxes and duties on the importation of clothing and other goods from China, by under-declaring their value and weight.

The scheme is suspected to run into the millions of euros.

Kövesi said the scale of the case, which involves lots of connections and transactions with other countries, was a difficult one to investigate.

She acknowledged how the police had helped a lot on this particular investigation.

“We also have other cases, and just two prosecutors to work on them. That means there need to be more police to support them, as all cases need to be worked on”, she said.

She said that while the case in question was a big one for Malta, it was still “only one case”.