Committee MEPs Urge EU Budget Watchdogs to Adopt AI Tools

Criminal networks are taking advantage of new technologies

Calls to reconsider the VAT fraud threshold for EPPO investigations

Institutions need stronger coordination

Calls for greater use of AI tools to combat fraud involving EU funds are outlined in a draft resolution adopted Budgetary Control (CONT) Committee MEPs.

Criminal networks operating in the EU “are fully embracing the entire range of cutting-edge information technology” and pose an increasingly complex threat to the EU budget and a new challenge for law enforcement, MEPs note in their resolution on the Commission’s annual report on the protection of the EU’s financial interests.

In response to this, CONT MEPs demand a dedicated EU-wide initiative to develop AI-driven fraud detection mechanisms within the institutions responsible for preventing financial crimes against the EU budget.

Addressing VAT Fraud

VAT fraud remains one of the most common crimes against the EU budget. MEPs reiterate their call for the Commission to reconsider the €10 million threshold required for VAT fraud cases to fall under the jurisdiction of the European Public Prosecutor’s Office (EPPO), which has been operating since mid-2021. They argue that this allows criminals to exploit legal loopholes by choosing jurisdictions where enforcement is weakest, thereby evading EPPO’s intervention.

Strengthening Anti-Fraud Governance

The report also urges the Commission to implement stricter anti-fraud governance measures, improve the efficiency of fund recovery mechanisms, and enhance accountability to protect EU financial interests. Better coordination among key institutions - including the European Anti-Fraud Office (OLAF), EPPO, Europol, and national authorities - is crucial to impeding evolving threats.

In 2023, the number of fraud and irregularity cases reported by EU and national authorities exceeded 13,000, involving a total of €1.9 billion. Both figures represent an increase from 2022.

Next Steps

Committee MEPs endorsed the resolution on Tuesday with 22 votes in favour and two against with three abstentions. A plenary vote on the text is expected to be held in May 2025.

Background

The European Commission publishes an annual report assessing its efforts and the work of member states to combat fraud against the EU’s financial interests. Parliament draws on this report, and on input from EPPO, OLAF, the European Court of Auditors, and other institutions. It then adopts a resolution evaluating the progress made over the past year and identifying areas requiring urgent action.