(CN) — In a major, first-of-its-kind move, the European Union is setting up a European-wide prosecutor's office that will have power to investigate and charge people for financial crimes committed against the EU.
The European Public Prosecutor's Office is expected to come into force next year or early in 2021. Akin to federal prosecutors in the United States, the new agency will consist of a central office in Luxembourg and satellite prosecutors’ offices in individual EU countries.
Since the EU's birth, the economic and political union has not had an EU-level agency invested with prosecutorial powers. Today, if someone commits fraud against the EU they are taken to court by national prosecutors, but experts say that system has proven ineffective.
“Crimes involving EU funds are not a priority for national authorities, and that's a problem,” said Carl Dolan, director of Transparency International EU, an anti-corruption Berlin-based watchdog group, in a telephone interview with Courthouse News. “There is a general perception that this is not anybody's money, it comes from Brussels and therefore it doesn't really matter what they do with the money.”
Though the EU prosecutors’ powers will be limited to going after financial crimes involving the EU’s financial interests, experts said this will be an improvement over assigning cases to national prosecutors.
“National public prosecutors may not be very committed to prosecuting crimes of EU funds; they may not have enough resources, not enough expertise to do it,” said Fabio Giuffrida, a European criminal law researcher at Queen Mary University of London and the University of Luxembourg. “Studies report that national prosecutors tend to have crimes against the EU budget at the bottom of the pile.”
Corruption, customs cheating and fraud involving EU funds are a major problem. The EU has an annual budget of about $161 billion and officials estimate more than 2 percent of it — $3.4 billion a year — may be used fraudulently.
And this is likely only the tip of iceberg when it comes to fraud and illegal money transactions in Europe, where mafia-like criminal groups and white-collar crimes, such as money laundering, are legendary.
For example, a 2016 study by RAND Europe, a think tank, estimated corruption and financial crimes of all kinds cost Europe’s gross domestic product from $205 billion to $1.1 trillion a year.
To tackle the full spectrum of crimes, many legal experts say the EU prosecutor’s office should be given even greater powers. To that end, the European Commission, the EU’s executive arm, has proposed expanding the reach of the EU prosecutors to handle cases involving terrorism.
Ester Herlin-Karnell, an EU constitutional law professor at the VU University of Amsterdam, and Carlos Gómez-Jara Díez, a criminal law professor at the Universidad Autónoma de Madrid, wrote in a recent essay that the powers of the EU prosecutors likely will broaden, just as they did for US attorneys.
Before the Civil War, they pointed out, US attorneys were permitted to prosecute only crimes mentioned in the Constitution — such as piracy, counterfeiting and treason — and crimes against the federal government. Today, US attorneys handle a much greater portfolio.
“Over the years, however, their powers have expanded,” they wrote about US attorneys, “a situation that probably will also take place in the EU.”
But enlarging the powers of EU prosecutors will require the approval of Europe’s national leaders, and that will not be easy. Indeed, Europeans spent two decades debating whether the EU prosecutor’s office should be created at all.
“With few exceptions, member states were never happy to relinquish criminal law powers,” Giuffrida said in a telephone interview. He said countries were “very reluctant to give up their sovereign powers.”
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