The European Union is preparing to overhaul its framework for tackling fraud against its budget, as increasingly complex schemes place greater pressure on European and national authorities.
The European Commission’s annual report on the protection of the EU’s financial interests assesses, for the first time, every stage of the response to fraud, from prevention and detection to investigation and the recovery of misused funds.
Irregularities worth €2.1 billion recorded
The 37th annual report brings together information from EU member states, the European Commission, the European Anti-Fraud Office, known as OLAF, and the European Public Prosecutor’s Office, or EPPO.
According to the findings, 13,010 irregularities worth a total of €2.1 billion were recorded in 2025. Of these, 986 were classified as fraudulent, with a financial impact of €274.3 million.
Although the number of cases fell by 7.6% compared with 2024, the amounts involved increased by 12.8%. The Commission said this indicated that fraud-related threats were evolving and required more advanced detection methods.
Greater focus on prevention
The Commission highlighted the importance of investing in early detection systems, improving the exchange of information and strengthening the authorities responsible for protecting EU funds.
These measures can help prevent financial losses before European funding is disbursed, according to the report.
Among the proposed actions is the broader use of risk-analysis tools such as Arachne+, alongside the faster referral of suspicious cases to prosecuting authorities.
Recovery rate exceeds 96%
The report also recorded positive results in the recovery of EU funds.
On the basis of OLAF’s financial recommendations, member states and EU institutions recovered more than 96% of the amounts for which monitoring procedures were completed between 2016 and 2025.
Investigations remain lengthy
Despite the progress, the report identified continuing weaknesses in the system. Investigations often remain lengthy and complex, while closer coordination is needed between administrative, investigative and judicial authorities, particularly after cases are referred to the courts.
Improving information-sharing and strengthening cooperation between OLAF, EPPO and national authorities are among the EU’s main priorities for the coming years.
Anti-fraud framework to be reviewed
The Commission is preparing a review of the EU’s anti-fraud architecture ahead of the next Multiannual Financial Framework.
Measures under consideration include mandatory national anti-fraud strategies, stricter reporting obligations for member states and an updated legal framework governing the European bodies responsible for combating fraud.
A further Commission communication on the future of the EU system for protecting its financial interests is also expected and could pave the way for new legislative proposals.
Source: CNA
