EU Recovery Fund Fraud Cases Surge, Italy Remains a Focal Point

The European Public Prosecutor’s Office (EPPO) is grappling with a significant increase in fraud cases linked to the EU’s Recovery and Resilience Facility (RRF), the bloc’s post-pandemic economic recovery fund. New investigations opened in 2025 nearly doubled those launched in the previous year, raising concerns about the protection of EU funds.

Investigations and Financial Impact

By the end of 2025, the EPPO had 512 active cases connected to the RRF, involving approximately 2,000 suspects and an estimated €5 billion in damages . This represents a substantial rise from 2024, when the number of investigations into suspected RRF fraud more than doubled. Suspected fraud related to the RRF now accounts for 21% of all active expenditure fraud investigations across EU programs, up from 17% the previous year.

Italy at the Center of Investigations

A significant portion of the active cases – 331, or approximately two-thirds – involve Italy . While Italy is the largest recipient of RRF funds, having received €153 billion out of the €394 billion disbursed as of 2025 , the EPPO has praised the Italian Financial Police (Guardia di Finanza) for their proactive work in detecting financial fraud, including EU fraud .

Broader Trends and Challenges

The EPPO acknowledges that the lack of reported fraud cases in other EU member states doesn’t necessarily indicate a lack of fraudulent activity. Detecting fraud is inherently demanding, as it is often concealed. However, the EPPO has noted improvements in efforts to tackle RRF-related fraud in Belgium, Cyprus, Latvia, and Spain.

the EPPO had 3,602 active cases with estimated damages of €67.3 billion at the end of 2025, a significant increase from the 2,666 cases and €24.8 billion reported the previous year.

Warnings and Ongoing Concerns

The potential for fraud within the RRF was flagged shortly after its establishment in 2020 by the EU’s anti-fraud agency (OLAF). Concerns have been raised regarding transparency in the allocation of funds and the reluctance of member states to fully utilize available anti-fraud tools. For example, a 2022 proposal to require member states to employ the Commission’s blacklist to prevent known fraudsters from receiving RRF money was rejected by EU governments due to concerns about administrative burden.

The European Court of Auditors recently warned that the EU’s budget is “insufficiently protected” against fraud involving RRF funds and that any lost money may not be recoverable.

RRF Timeline and Remaining Funds

The RRF is set to conclude this year. Member states must meet all agreed-upon milestones and targets by August 31, 2026, with no further payments allowed after December 31, 2026. As of late 2025, approximately €122 billion in grants and €61 billion in low-interest loans remain unspent.