Police Put the Loss at More Than 17 Million Euros in the State Development Bank Fraud Case, With Two Detained and 35 Formal Suspects
The Judicial Police say Operação Harpia concerns a loss that may exceed 17 million euros in national and EU funds for small businesses, below the 20 million first reported. Two people were detained; no one has been charged.
Two people have been detained and 35 made formal suspects in a Polícia Judiciária (PJ, the Judicial Police) investigation into suspected subsidy fraud that the force says may have cost more than 17 million euros. The PJ announced the figures on Tuesday evening, 10 November, in a communiqué on what it calls Operação Harpia. The money came from public credit lines meant to help small and medium-sized businesses grow, which is why the case matters beyond the courtroom: it concerns national and EU funds that firms across the country apply for.
The communiqué follows the searches we reported on Tuesday at firms in Lisbon, Porto and Santarém, and it changes several of the details in that report.
What the Judicial Police said
According to the PJ, its Unidade Nacional de Combate à Corrupção (UNCC, the national anti-corruption unit) carried out 54 search warrants in the districts of Lisboa, Porto, Braga, Aveiro, Santarém and Ponta Delgada. The 35 suspects are 7 individuals and 28 companies. The suspected crimes are fraud in obtaining a subsidy, diversion of a subsidy, money laundering and forgery of documents.
Investigators believe several companies and financial intermediaries, described as business-angel vehicle entities, used false documents and invoices to obtain national and EU money from financing lines designed to support the competitiveness and capitalisation of small and medium-sized enterprises in their early stages of growth, internationalisation and innovation. Through its Gabinete de Recuperação de Ativos (the Asset Recovery Office), the PJ provisionally seized crypto-assets, property, luxury cars, boats, shareholdings, bank accounts, works of art, watches and jewellery. The case is directed by the Departamento Central de Investigação e Ação Penal (DCIAP, the central prosecution department).
Becoming an arguido (a formal suspect) gives a person or company specific rights and duties in the investigation; it is not a charge. No one has been charged, and everyone involved is presumed innocent.
The link to the development bank, and a corrected figure
The PJ communiqué does not name Banco Português de Fomento (BPF), the state-owned development bank. ECO, updating its report with the PJ's information on Tuesday night, described Operação Harpia as the investigation into the suspected fraud against BPF. Earlier that day, Público reported that a PJ source had confirmed to Lusa that searches over the BPF case were under way.
Tuesday's press reports put the suspected fraud at about 20 million euros. The PJ's own figure is lower: a loss that may exceed 17 million euros. That is close to the total BPF gave in its statement, as quoted by ECO, for the investments in question: 8.68 million euros through FINOVA lines and 8.64 million euros through lines of the Fundo de Capital e Quase Capital (FCQC, the capital and quasi-capital fund), one of which was a financing line for business-angel vehicles. BPF said it had not been searched, that the investments were made between 2010 and early 2022, and that it has cooperated with the authorities since 2023.
What happens next
By Wednesday afternoon none of the approved outlets we checked had reported the detainees appearing before an investigating judge, or any coercive measures. Those measures, if any, will be the next step; a charge, if one comes, would follow only at the end of the investigation.
The case adds to a run of investigations into public and EU money, after European auditors flagged a Portugal 2020 project for suspected fraud in October.
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