Our estimate of the level of error is not a measure of fraud, inefficiency or waste. It is an estimate of the money that should not have been paid out because it was not used in accordance with the applicable rules and regulations. Typical errors include payments for expenditure which was ineligible or for purchases without proper application of public purchasing rules.
Fraud is an act of deliberate deception to gain a benefit. We report suspected fraud cases detected during our audit work to OLAF, the European Union’s anti-fraud office, which investigates and follows up as necessary in cooperation with authorities in the Member States. Out of the some 1 200 transactions that we assessed for legality and regularity during the 2014 audit, we found 22 instances of suspected fraud (2013: 14) which we forwarded to OLAF. The most frequent instances of suspected fraud concerned declaration of costs not meeting the eligibility criteria, followed by cases of conflict of interest and other irregularities in procurement as well as the artificial creation of conditions to be eligible to receive a subsidy. During the year, we also have cases of suspected fraud that arise from work not related to the statement of assurance.