Italian mafia trial could expose underbelly of massive EU fraud

Officials claim the multi-million euro scheme involved the mob, white-collar accountants, politicians and government employees.

MESSINA, Italy — In a bunker-style courthouse tacked onto a prison, close to a hundred suspected mafiosi and their accomplices are standing trial, accused of defrauding the EU out of millions of euros.

The so-called maxi-trial is expected to reconstruct, for the first time, an integrated system through which prosecutors say mob clans and their associates targeted the €55 billion in farm subsidies the EU pays out annually.

It’s a scheme that officials claim involved not just the mob, but white-collar accountants, politicians and government employees, leading to at least €10 million in stolen EU agricultural funds. And it’s a moment that reflects the diversification of criminal organizations in southern Italy, where groups have evolved from traditional activities of drugs and extortion to tapping more profitable and less high-risk income streams — including EU grants meant to support farmers.

The proceedings are likely to last at least a year, with 97 defendants, 90 lawyers and up to 1,000 witnesses, with a number of state’s witnesses prepared to break their omerta, or code of silence. On Tuesday, when the trial started, it took more than an hour for the roll call of defendants, who are accused of crimes including fraud, false statements, extortion, creating fake companies for illegal gain, drug pushing and stealing livestock.

“A colossal fraud,” the investigating judge proclaimed in a pre-trial charge sheet, “exploiting the EU funding on a huge scale and to perfection.” It was, the document declared, “a devastating phenomenon. A mafia ready to take on Europe using illegal methods, and an [Italian] state that is already behind and playing in defence.”

Sitting in court, Italian Senator Mario Giarrusso, a veteran anti-mafia campaigner, reflected on the moment, calling it “extraordinary and symbolic.”

With the trial, he said, the public can now “reconstruct the mechanisms used systematically by the mafia and white-collar officials.” And, he added, it represents a significant shift in how the Italian courts are treating fraud.

Until now, improperly claiming EU subsidies had been treated as simple fraud in Italy, a crime that often goes unpunished due to drawn-out court proceedings. But now that prosecutors are approaching it as a mob scheme, Italy’s tough anti-mafia laws mean some defendants could face up to 25 years in prison.

“This is the major new development revealed in this trial — an integrated, organized system” of subsidy fraud, Giarrusso said.

The case is also topical given the €209 billion windfall Italy is expected to receive as part of the EU’s post-pandemic recovery fund. While the trial could alarm people by exposing the depths of EU graft within Italy, it may also serve as an opportunity to show EU leaders the country is serious about preventing criminals from skimming off the top.


Four years in the making

The massive public trial is the culmination of four years of investigative work that burst into public view 13 months ago, when roughly 1,000 police officers raided scores of suspected mafia members.

The arrests took out much of the hierarchy of two major mafia clans — the Battanesi and the Bontempo Scavi. Both groups are distinguished by their colorful nicknames. There’s Blondie, Banger and Vito Corleone, named after Marlon Brando’s character in “The Godfather.” And the alleged boss of the Batanesi clan is Sebastiano ‘Swagger’ Bontempo.

Based in the Nebrodi mountains, a protected area covering 860 square kilometers, the mafia families are “characterized by strong family ties, violence and brutality,” the arrest order said.

The two clans share power in the village of Tortorici, the hometown of the bombmaker who laid the explosion that killed Italy’s most famous martyr, anti-mafia prosecutor Giovanni Falcone.

This division of power has not always worked smoothly. There was a bloody turf war in the 1980s and 1990s, which left more than 40 people dead. But the two groups have since allegedly put their differences aside in their joint aim of defrauding the EU.

Prosecutors say the two groups cooked up a scheme to identify plots of land where EU funds had not yet been claimed. Officials working at local government agencies helped track down these plots, accessing the land databases in exchange for cash. The coordination with officials reduced the risk of duplicate subsidy requests for each land plot.

The mafiosi then allegedly created a fake rental contract, or forced the landowner to sign a rental contract, appropriating the land, which they often did not bother to farm.

Some funding applications were made for land which was not farmland, or not actually owned or leased by the applicants at all, including a plot owned by the Catholic Church and another on which a railway had been built, according to the indictment. Other suspect land plots included one that the U.S. navy used to host satellite communications

Any disagreements between the two mafia clans over these plots were resolved via mediation.

Since the arrests, three of the accused mafia members have turned state’s witness, according to investigators, providing new evidence suggesting the fraud goes back to the 1990s.


In the courtroom

Piera Aiello, a member of parliament who married into the mafia but turned state’s witness herself in the 1990s, was there to witness the start of the trial on Tuesday.

Aiello has become an advocate for those who collaborate with the justice system, but looking at the cages lining the courtroom, she remarked to POLITICO how difficult the task will be for the informers in the trial.

“It is one thing to go against one mafioso, but to go against 100?” she said. “It is such a hard moment to look into their eyes and point the finger at the mafia. Your heart tremors.”

Authorities in Italy first became conscious that mafia clans were abusing EU subsidies around 2012, when Giuseppe Antoci, a former president of the Nebrodi region, mandated background checks for those applying for funds. The move made Antoci a mafia target, and he faced an assassination attempt in 2016 —the most high-profile attack on an institutional figure since the 1990s.

Antoci now lives under 24-hour armed guard, but he also showed up to the courthouse on Tuesday, defiant.

“I want to look in the eyes of those who have for decades held this land hostage,” he said.

The victims, he said, are not just the EU and taxpayers, but the community and local residents missing out on funds — “farmers, young people who want to start a business, who want to find an opportunity to stay in their hometown,” he said. “The EU money needs to go to these people.”

Lawyers for the defendants said their clients maintained their innocence, arguing they had been the victims of a miscarriage of justice.

Alessandro Pruiti Ciarello, the lawyer for nine defendants, said that these maxi trials are “less fair” for the defendant as group responsibility is established without necessarily proving the specific involvement of each individual.

“They do not have to show individual responsibility,” Ciarello said. “Often some big fish goes free and some little fish is condemned.”

As the first of its kind in Europe, the trial could serve as a blueprint for other regions of Italy and countries.

The Greens group in the European Parliament this week released a report detailing the misuse of European agricultural funds in five Central and Eastern Europe countries. And a Slovakian journalist, Jan Kuciak, was killed in 2019 while investigating Italy’s Ndrangheta mafia for defrauding the EU.

Investigators concede their findings are likely only the tip of the iceberg.

The maxi-trial, said Giarrusso, the anti-mafia advocate, is “a warning” to the mafia: “It shows we can fight this phenomenon.”


By Hannah Roberts, March 4, 2021, published on POLITICO

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