EU-funded project in Italy suspected of mafia links

Berlin - Three NGOs on Wednesday (22 January) filed an official complaint with the EU anti-fraud office, Olaf, demanding an investigation into an EU-sponsored motorway in Italy, where construction firms are suspected of fraud and infiltration by the mafia.

The project at stake is the Passante di Mestre motorway - a bypass around the northern Italian city of Mestre, just across the bay from Venice.

Last year, it received a loan of €350 million from the European Investment Bank (EIB) to refinance the debt accumulated by the project since its start, in 2003.

Initially budgeted at €750 million, the motorway has faced delays and the cost has almost doubled to €1.3 billion.

In March 2011, the project was criticised by the Italian Court of Auditors i for lack of public supervision and the risk of infiltration of organised crime via subcontractors.

In addition, Italian prosecutors have launched a criminal investigation into fraud which led to the arrest of four people in February 2013, prior to the EIB releasing the loan.

Twenty more arrests were carried out last year, including the CEO of one of the main subcontractors, as well as police agents and former spies.

In October 2013, the anti-mafia authorities took into custody the CEO of FIP Industriale, another member of the highway consortium, accusing him of alleged links to criminal organisations and false registration of assets.

“This case raises real concerns about the due diligence carried out by the [EIB] bank and its inability to withdraw from projects where alleged corruption has been detected,” says Xavier Sol, director of Counter Balance, one of the three NGOs flagging up the case.

For its part, the European Commission is considering the project for co-financing under so called project bonds - an initiative launched two years ago redeploying unused EU money and EIB loans for stimulating the economy via large infrastructure projects.

But the three NGOs are asking the EU to halt all funding to the scheme.

“We hear for years now that 'it is Europe demanding this project.’ Today Italian citizens demand Europe to investigate the direct responsibilities of its own institution," Rebecca Rovoletto from Opzione Zero, a civic association opposing the motorway, said.

"Local committees and groups have publicly denounced the opacity of how local politicians and business leaders have been managing the region. We call on the EU to support our demand for more democratic control over the use of public finance instead of backing the interests of local baronies,” she added.