Study on the implementation of Article 125(4)(c) of the CPR in the Member States
7. Key lessons
The following are some of t he key takeaways from this study of anti -fraud and corruption measures
in the implementation of ESI Funds.
Anti-fraud and anti-corruption efforts are more formalised and
systematic in the 2014-2020 programming period
New legislative requirements to address fraud and corruption in ESI Funds f or the 2014-2020
programming period have catalysed a num ber of changes at MS level that have resulted in a more
formalised and more systematic approach. The FRA process is one example. A number of
authorities had in place some form of fraud risk assessment process prior to 2014, often in the
context of a broader risk assessment. Using the FRA template helped to put more focus on fraud
and corruption risks , and created clear links between identified risks and specific mitigating
measures. And of course, going through this process, and having the list of EC-recommended
mitigation measures at hand did contribute to some authorities adopting new c ontrols, or
improving existing ones. In this way, the EC effort to increase the focus on anti -fraud and
corruption amo ng ESI Funds authorities in the 2014 -2020 programming period has had a
significant positive impact.
The mitigating measures implemented are generally proportionate to
the self-assessed risks
The obligations of Article 125(4)(c), and thus a primary focus of this study, is that OP authorities
put in place measures proportional to the identified fraud and corruption risks. Based on the
analysis of the sam ple of FRAs, we concluded that overall, authorities are i mplementing mitigation
measures that are proportional to the self -identified risks. In fact, the team identified just a handful
of instances where the measures in place were considered truly inadequate to the ris ks. This
highlights the effort put in place by author ities in order to conduct a fraud risk assessment and
mitigation of identified risks through appropriate controls.
Proportionality was lowest for collusive bidding and double funding
Of the 6 risk categories analysed, collusive bidding a nd double funding were the two where there
was the greatest room for improvement in terms of implementing proportional mitigating
measures, particularly amon g high risk OP’s in Member States with a low CPI score. Often ,
authorities implemented neither EC-recommended measures nor ad ditional detection measures.
As these ris ks are particularly difficult to detect, it is crucial to devise appropriate measures to
reduce the level of ris k assessed. Particularly, concerning collusive bidding, authorities did not
impose rules on b eneficiaries to control the procurement process to detect c ollusive bidding.
Moreover, authorities often d id not conduct checks themselves on companies and third parties
participating in tenders. Concerning double funding, crosschecks w ere lacking in some high and
medium risk OPs to identify identical projects funded under different OPs.
Some authorities may underestimate the risks during the self-
A comparison between the self-assessed level of risk by authorities of the OPs in the sample and
external indicators of potential fraud and corruption risks at the MS level, notably Transparency
International’s Corru ption Perception Index , shows a discrepancy. This indicates that MS may be
assessing the level of fraud risks differently. Indeed, there was an observed pattern of authorities in
MS with moderate fraud risk indicators, and to a lesser extent those with low fraud risk indicators,
assessing their risks as higher than countries with high risk indicators. This indicates that some
authorities in countries with higher fraud risks are underestimat ing risks for fraud and corruption
compared with authorities from countries with lower fraud risks.
If this were the case, it would have an impact on the conclusion on proportionality, which are
dependent on the self-assessed level of risk. Concretely speaking, it would mean that the above
analysis somewhat underestimates the proportionality of mitigation measures in low perceived risk