OLAF to investigate PHARE funds fraud in Czech Republic

The European Anti-Fraud Office is investigating two cases of embezzlement of funds provided by the European Union's PHARE development programme to the Czech Republic. In the first case, a local official claimed excessively high travel expenses, defrauding the programme of hundreds of Euros, the other one was far more serious. The director of the serious economic crime department of the supreme state attorney's office, Petr Kovanda, gave Czech Radio more details:

"The fraud involved money from the PHARE project, amounting to tens of thousands of Euros," Kovanda said adding that the offences had been repeated many times over a longer period of time.

The European Anti-Fraud Office, or OLAF in short, was set up by the European Commission to fight fraud, corruption and any other illegal activity affecting the financial interests of the European Community.

The office of the Czech supreme state attorney and OLAF signed an agreement on cooperation at the end of last year. Although the reported cases are not considered very serious, the authorities expect more wide-spread fraud involving EU funds as financial support for the Czech Republic grows.