Évora Prosecutors Charge 13 Over Alleged Fake Invoices for EU Forestry Aid, and Seek 16 Million Euros in Forfeiture
Seven people and six companies are accused of 44 counts of subsidy fraud and one of money laundering, over rural development grants paid by IFAP between 2011 and 2015 for projects from Grândola to Ponte de Sor.
Prosecutors in Évora have charged 13 defendants with running a scheme to obtain European rural development subsidies with inflated and fictitious invoices, and have asked the court to order the forfeiture of just over 16 million euros. The Public Prosecutor's Office announced the indictment on Tuesday.
According to the statement published by the Évora Regional Prosecutor's Office, the Regional Department of Investigation and Prosecution (DIAP) has sent to trial before a panel of three judges seven individuals, all Portuguese nationals, and six companies, all based in Portugal. They are accused of 44 counts of subsidy fraud, one of them attempted, and one count of money laundering. The investigation was carried out with the help of the Polícia Judiciária.
How the scheme allegedly worked
The prosecution says that between 2011 and 2015 the defendants devised and carried out a plan to take large sums from the European Agricultural Fund for Rural Development (EAFRD), by applying for support under PRODER, the rural development programme's measures for forest and agroforestry management.
The plan, repeated with each application, consisted of charging the projects with artificially inflated costs, backed by false invoices issued by companies the defendants controlled. Some invoices overstated what had really been spent; others covered work that was never done. The aim was to obtain subsidies larger than the real cost of the projects.
When the Agriculture and Fisheries Financing Institute (IFAP), which pays out EU farm aid in Portugal, asked for proof that some of the work had been done, the defendants allegedly produced invoices from subcontractors that had no activity at all, invoices dated after the work had already been billed, and invoices for services and quantities that had already been used up in other operations and payment claims.
Prosecutors say the group also set up a financial scheme to hide the origin of the money, moving it through successive bank transfers and returning part of the invoiced amounts to other defendants and companies. According to Lusa, the projects financed in this way were in several parts of the country, including Grândola, Santiago do Cacém, Ponte de Sor, Abrantes, Avis and Odemira.
What the prosecution is asking for
The 16,023,938.69 euros is a forfeiture request, not a sum established by a court. The prosecution says it covers the direct advantages obtained, interest on gains that were reinvested, and the positive balance left in the defendants' personal bank accounts from part of the money paid by IFAP. The prosecution has also asked that the individual defendants be barred, as an additional penalty, from receiving subsidies or grants from public bodies.
The defendants are presumed innocent. They can now ask for an instrução, a pre-trial stage in which a judge reviews whether the evidence is strong enough to justify a trial. If none is requested, or if the judge confirms the charges, the case goes to trial.
Why it matters
Portugal receives large amounts of EU money for farming and forestry. Since June 2021, suspected fraud against the EU budget has also been investigated by the European Public Prosecutor's Office, which handles offences committed after November 2017; the alleged offences in this case predate that, which is why it stayed with Portuguese prosecutors. Separately from any criminal case, IFAP can seek repayment of aid it considers was paid improperly.
