Reporting Suspected Corruption and Fraud in Bucharest

1. Reporting suspected corruption and fraud Bucharest June , 2013

2. DLAF’s role LAW no. 61/2011 regarding the organization and functioning of Fight against Fraud Department – DLAF: • DLAF ensures, supports and coordinates, as the case may be, the fulfilment of Romania’s obligations with regard to the protection of European Union financial interests, as per Article 325 of the Treaty on the Functioning of the European Union; • The Department is the contact institution of the European Anti-Fraud Office – OLAF within the European Commission. 2

3. DLAF’s main functions • coordination of the fight against fraud in order to assure effective and equivalent protection of the European Union’s financial interests in Romania; • control, in order to identify irregularities, frauds and any other illegal activities that affect the European Union’s financial interests in Romania; • regulatory, which ensures the drawing up of the legal and institutional framework necessary to the protection of the European Union’s financial interests in Romania; • representation, which ensures Romania’s participation in advisory committees, working groups and also in communication and information exchange networks, regarding the protection of the European Union’s financial interests. 3

4. DLAF’s main competences • ensures and facilitates the cooperation between national institutions involved in the protection of the European Union’s financial interests in Romania, as well as between these and the European Anti-Fraud Office and relevant public authorities from other Member States or from other countries that benefit of EU financial assistance; • carries out or coordinates control activities in order to detect irregularities, frauds and other illegal activities related to the management, procurement and use of European funds, as well as of the related co-financing funds and of any other funds that fall within the scope of EU financial interests, including loans and guarantees granted by the European Investment Bank; • carries out or coordinates appropriate control activities in order to detect irregularities, frauds and other illegal activities affecting the European Union’s financial interests in Romania through the unlawful diminution of own resources; • ... • ensures, coordinates and monitors the reporting of irregularities between the national institutions and the European Commission in accordance with the provisions of European legislation. 4

5. Sources of information DLAF • receives notifications from the European Anti-Fraud Office • receives notifications from other sources • acts ex officio regarding alleged irregularities, frauds or other activities affecting the financial interests of the European Union in Romania. 5

6. Reporting responsibilities Government Emergency Ordinance no. 66/2011 regarding the ascertaining and sanctioning of irregularities occurred in the obtainment and usage of European funds and/or national public funds afferent to these “The authorities with competences in the management of European funds have the obligation to notify immediately DLAF and the criminal proceeding bodies in case of ascertaining indications of fraud or attempted fraud” (art. 8); 6

7. Reporting responsibilities The Methodological Norms for the application of the provisions of Government Emergency Ordinance no. 66/2011, approved by Government Decision no. 875/2011 (art. 7): • “In the situations in which the authorities with competences in the management of European funds identify, in their current activity of verification of the payment /reimbursement requests presented by the beneficiaries as well as following on-the-spot verifications, indications regarding a possible fraud/ attempted fraud, these have the obligation to notify immediately Fight Against Fraud Department - DLAF and to transmit all the available information. • The systems and fraud indicators which must be considered, on the basis of the good practices principle, for the purpose of identifying indications regarding a possible fraud, in the situations in which the assessment of the risks indicate an increased fraud risk, are foreseen in annex no. 1…”. 7

8. Reporting responsibilities Collaboration protocol concluded between the Audit Authority and DLAF (point 2.2.2) “The Audit Authority notifies DLAF in the situation in which, following the audit mission, it discovers indications of fraud”. 8

9. Control results • In case the irregularities are detected in the procurement or use of European funds and related co-financing funds, the Department sends the control report to the authorities involved in the management of funds in order to fulfil their obligations of irregularity reporting and financial recovery, according to the law; • Authorities under par. (1) have the obligation to communicate, within 60 days from the receipt of the Department’s control report, the measures taken in order to remedy the issues raised by it and the actions taken to recover possible damages; • In case the irregularities are detected in the management of European funds, the Department sends the control report to the competent ministries in order to take necessary measures to remedy deficiencies and, where appropriate, to sanction the persons responsible, and informs the Prime Minister; • The competent ministries inform the Department, within 60 days, on the measures taken to remedy the issues raised by the control report and, where appropriate, the sanctions imposed; • In case of detection of criminal aspects, the Department notifies also the prosecutor competent to conduct the criminal investigation and forwards the control report in order to recover the damages and to impose criminal liability of those responsible. 9

10. Reporting activity Government Emergency Ordinance no. 66/2011 regarding the ascertaining and sanctioning of irregularities occurred in the obtainment and usage of European funds and/or national public funds afferent to these “At national level, the irregularity reporting activity, provided for in the European legislation, to the European Commission is coordinated by DLAF” (art. 59 – (1)). 10

11. Irregularity officers In order to assure the carrying out of the activity of registration, monitoring and reporting of irregularities, the authorities with competences in the management of EU funds are obliged to appoint an irregularity officer. Attributions of the irregularity officer: - Fulfilling the obligations of receipt, analysis and registration of all notifications in the Irregularity Register; - Informing in writing the management of the authority with competences in the handling of EU funds with regard to the necessity to initiate verifications; - Receiving the result of the investigations of the control structures; - Drawing up irregularity reports and forwarding these for approval by the manager of the authority with competences in the handling of EU funds; - Monitoring the progresses made in the process of recovery of debts generated by irregularities, in collaboration with the financial-accounting services of the authority with competences in the handling of EU funds; - Ensuring the notification of the certifying authorities; - Ensuring the completion of the necessary data in the Debtors’ Register . 11

12. Irregularity Reporting Manual Irregularity Reporting National Manual • national entities involved • irregularity reporting structure • deadlines for each reporting level • detailed responsibilities for each entity 12

13. Reporting structure module 1828 Keywords: professionalism, communication • Cascade vision 1848-meeting 20 October 2010

14. Reporting structure module 1828 OLAF Level 0 Level 1 DLAF ACP Level 2 AN CTE AM POR AM CBC RO-BG AM POST Level 3 AM PODCA AM POSDRU AM POSM AMPOSCCE OI IMM Level 4 OI E OI PSI OI C 14

15. Deadlines “within two months following the end of each quarter, Member States shall report to the Commission any irregularities which have been the subject of a primary administrative or judicial finding” (art. 28 from Commission Regulation (EC) no. 1828/2006). 1848-meeting 20 October 2010

16. PACA Are considered administrative primary or judicial ascertaining acts: • The minutes of ascertaining irregularities and establishing the budgetary debts issued by the competent authorities foreseen at art. 20 from GEO no. 66/2011 • The ascertaining document issued by the competent audit bodies • The control act issued by DLAF • The inspection report issued by OLAF • The solution disposed by the prosecutor, by which is ascertained the existence of deeds which affect EU’s financial interests 1848-meeting 20 October 2010

17. Derogations / Exceptions The following cases need not be reported: • cases where the irregularity consists solely in the failure to execute, in whole or in part, an operation owing to the bankruptcy of the beneficiary; • cases brought to the attention of the managing authority or certifying authority by the beneficiary voluntarily and before detection by either of them, whether before or after the inclusion of the expenditure concerned in a certified statement submitted to the Commission; 1848-meeting 20 October 2010

18. Derogations / Exceptions (c) cases which are detected and corrected by the managing authority or certifying authority before inclusion of the expenditure concerned in a statement of expenditure submitted to the Commission. • However, irregularities preceeding a bankruptcy and cases of suspected fraud must be reported. 1848-meeting 20 October 2010

19. Reporting threshold Where the irregularities relate to amounts of less than EUR 10 000 chargeable to the general budget of the European Communities, Member States shall not send the Commission the information regarding the irregularity, unless the Commission expressly requests it. 1848-meeting 20 October 2010

20. Communication means The irregularity reports are submitted to the Commission only by AFIS – IMS 20

21. URT - manages requests concerning Organisation and User profiles through a request workflow engine; - provides up-to-date information regarding the state of users as well as the organisations population; - enables the monitoring, reporting of the request processing workflow.

22. Liaison officer Romanian’s liaison officer profile: • level 1 (DLAF) manager • experienced IMS user • attended the IMS training • attended the URT training 1848-meeting 20 October 2010

23. Liaison officer Romania’s liaison officer role: • is the linking pin between Romania and OLAF • provides all Romanian users with the necessary support • disseminates all the information received • can submit to OLAF the request for modification of the reporting structure (grant and revoke access, changes user rights…) 1848-meeting 20 October 2010

24. Statistics In 2013 DLAF collected and forwarded to OLAF a number of 522 reports set up for irregularities detected within Structural Instruments, in compliance with the provisions laid down by Regulation (EC) no. 1828/2006 of Commission, of which: - 325 initial reports, - 197 updating reports. http://www.antifrauda.gov.ro/en/reports/ 1848-meeting 20 October 2010

25. Thank you for your attention! Viorel DINCĂ Fight Against Fraud Department – DLAF viorel.dinca@antifrauda.gov.ro www.antifrauda.gov.ro