ATHENS — Greek authorities made dozens of arrests on Wednesday related to Greece’s spiraling farm fraud case, in an investigation led by European prosecutors.
Some 37 people suspected of being members of an organized criminal group involved in large-scale agricultural funding fraud and money laundering activities were arrested, and searches were carried out throughout the country, according to a statement by the European Public Prosecutor’s Office.
In a snowballing scandal, the EPPO is pursuing dozens of cases in which Greeks allegedly received agricultural funds from the European Union for pastureland they did not own or lease, or for agricultural work they did not perform, depriving legitimate farmers of the funds they deserved. POLITICO first reported on the scheme in February.
Several ministers and deputy ministers have resigned over their alleged involvement in the scandal. The EU has already fined Athens €400 million after finding evidence of systemic failings in the handling of farm subsidies from 2016 through to 2023. Greece also risks losing its EU farm subsidies unless it provides an improved action plan on how it will stop funds being siphoned off into corruption. The original deadline was Oct. 2, but this has now been pushed back to Nov. 4.
“The Commission is awaiting the submission of the revised action plan and in the meantime, it continues to be in contact with the Greek authorities,” a European Commission spokesperson told POLITICO earlier this month.
Wednesday’s operation centered on a criminal network accused of illegally obtaining EU farm subsidies through false declarations submitted to the organization in charge of distributing EU farm funds in Greece, OPEKEPE.
According to the EPPO, in the course of the preliminary investigation, 324 individuals were identified as subsidy recipients, causing an estimated cost of more than €19.6 million to the EU budget. Of these, 42 are believed to be involved in this case and are considered current members of the criminal group, says the EPPO.
Most of them appear to have no actual connection to farming or producing, according to the Greek and EU authorities.
The EPPO said that, at least since 2018, the group “allegedly exploited procedural gaps” in the submission of applications using falsified or misleading documents to claim agricultural subsidies from OPEKEPE. They are suspected of fraudulently declaring pastureland that did not belong to them or did not meet eligibility criteria. They allegedly inflated livestock numbers to increase their subsidy entitlements. To conceal the illicit origin of the proceeds, they are believed to have issued fictitious invoices, routed the funds through multiple bank accounts, and mixed them with legitimate income. Part of the misappropriated money was allegedly spent on luxury goods, travel and vehicles, to disguise the funds as lawful assets.
Greece’s anti-money laundering authority is investigating Giorgos Xylouris, a farmer from Crete and until recently member of ruling New Democracy. Xylouris is one of the key characters mentioned in EPPO case files, under the nickname Frappé (“Iced Coffee”), regarding the OPEKEPE scandal.
Some €2.5 million was discovered in his bank accounts during a random inspection, the Greek officials said. Authorities found that Xylouris had failed to submit the required financial documentation and could not justify the large sum. Eight vehicles were also identified in his possession, including a Jaguar luxury car. The case file has been sent to the prosecutors to examine possible violations of anti-bribery laws and an investigation is ongoing regarding whether money laundering has occurred.
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