A3-0346/93

Resolution on combating international fraud

The European Parliament,

-having regard to Articles 8a, 100, 220 and 235 of the EC Treaty and Title VI of the Treaty on European Union,

-having regard to its resolutions of 24 October 1991 on the legal protection of the Community's financial interests, of 11 March 1993 on respect for human rights in the Community and of 15 July 1993 on cooperation in the fields of justice and home affairs under the Treaty on European Union (Title VI and other provisions),

-having regard to its resolution of 13 May 1992 on the work of the Committee of Inquiry into Drugs Trafficking,

-having regard to the statements made at the hearings of the Committee on Civil Liberties and Internal Affairs of 18-19 March 1993 and 7 June 1993 respectively with representatives of the national parliaments and with the chairman of the anti-Mafia committee of the Italian Parliament,

-having regard to Rule 148 of its Rules of Procedure,

-having regard to the report by the Committee on Civil Liberties and Internal Affairs (A3-0346/93),

A.having regard to the increase in the scale of international fraud in the context of financial crime and the growing interconnection between financial crime as such and organized Mafia-type crime,

B.whereas, though not new, the internationalization of crime has today acquired a scope, spread and speed of growth due mainly to the internationalization of economic relations,

C.whereas the European system of combating organized crime has many internal differences which helps the perpetrators of organized crime to choose the areas and zones of jurisdiction which suit them best in each sector of activity,

D.whereas, without underestimating the step forward made in including cooperation in the fields of justice and home affairs in the institutional framework of European Union, the legal provisions of Title VI have considerable limitations both with regard to democracy and the protection of fundamental individual rights and guarantees and with regard to the effectiveness and coordination of anti-fraud measures,

E.wishing to be informed adequately and promptly on the measures of common interest which the appropriate ministers intend to take to combat international fraud and to ensure judicial, customs and police cooperation in this sphere; whereas this is essential if Parliament is to be able effectively to exercise its right to make suggestions; whereas interinstitutional consultations on the treatment of these parliamentary suggestions are urgently needed,

F.whereas the fight against the various forms of financial crime, in particular international fraud, must be pursued by combining a strategy of repression and punishment, primarily through the seizure of profits and the confiscation of property, with preventive measures and self-regulation on the part of the private sector and government services,

G.having regard to the particular importance of financial crime in general and, in the case of fraud in particular, of political and administrative corruption,

International fraud

1.Expresses reservations concerning the legal framework as defined under Article K1 of the Treaty on European Union, in particular with regard to the separation established between a general - and no more precisely defined -area of 'combating fraud on an international scale' (point 5) and judicial cooperation in criminal matters, customs cooperation and police cooperation (points 7, 8 and 9);

2.Expresses concern at the possible negative consequences which this separation could have at operational level and on the effectiveness of anti-fraud measures;

3.Therefore:

(a)calls for an end to the dual system of action to combat fraud on an international scale depending on whether administrative assistance or judicial cooperation in criminal matters are involved and calls for this point to be one of the priority areas for revision at the new Intergovernmental Conference provided for under the Treaty on European Union for 1996,

(b)pending this revision, calls on the Commission to take steps to promote, in accordance with Article K3(2), immediate initiatives aimed at acquiring better common awareness of the most important cases of fraud and the possible instruments for cooperation and assistance,

(c)calls on the Council to endeavour to coordinate as soon as possible initiatives for administrative assistance and for judicial and police cooperation,

(d)calls on the President of the European Parliament to take immediate steps to request interinstitutional consultations on the supply of information to the European Parliament and the treatment of its suggestions regarding the exercise of powers in the areas referred to in Article K.1 of Title VI of the Treaty on European Union,

(e)in this context calls for the promotion of initiatives to amend the laws (Directives 77/799/EEC and 79/1070/EEC on the control of evasion in the field of direct taxation and VAT, Regulation (EEC) No. 1468 of 19 May 1981 on fraud in agriculture and the Convention of 7 September 1967 on mutual assistance in customs matters) in order to include the judicial authorities in the exchange of information, originally only envisaged for the administrative authorities;

Community fraud

4.Considers that Articles 100a and 209a of the EC Treaty provide an appropriate legal basis to eliminate the differences and confusion in the procedural rules of the Twelve Member States, which are an obstacle to action to protect the Community's financial interests; in this context calls on the Commission to submit, by June 1994 at the latest, a legal instrument fixing the judicial requirements for harmonization of the criminal rules of the Member States protecting financial interests;

5.Calls once again for the simplification of rules, especially those on agriculture and the Structural Funds, since it may preclude many cases of fraud;

Financial crime and organized crime

6.Calls on the Commission to launch in-depth research into the various forms of financial crime at international level and their interconnection with organized Mafia-type crime; urges the Commission, therefore, to initiate research on the subject by the most competent European university research institutions and always to put the contracts concerned out to public tender;

7.Believes that, with a view to the creation of a Community legal and judicial area, the Commission should have a study undertaken on the degree to which such general legal principles as discretionary powers, legality, protection of the victim, presumption of innocence and balance between the parties are applied and/or considered desirable;

8.Considers it advisable, with a view to achieving a Community legal and judicial area, for the Member States to have the same definition of this type of crime in their own laws ('criminal associations along Mafia lines') or at least the same aggravating circumstances ('crime committed with the intention of abetting an organization akin to the Mafia') and also to provide for banks and credit institutions to be accurately identified, for the burden of proof to be reversed where large sums of suspect money are transferred and for banking secrecy to be waived to permit judicial inquiries, which could give rise to particular forms of international judicial cooperation;

9.Considers it necessary to overcome some of the limitations of Directive No. 91/308/EEC on money laundering, by providing for an amendment widening the scope of Article 1 on criminal activity to include organized financial crime such as fraudulent bankruptcy and tax and financial fraud ;

10.Calls for a programme of action to be launched by the Commission and Council within the scope of Title VI to get rid of tax 'paradises' and 'havens';

11.Considers it essential, in order to separate the legal economy from the criminal economy and to protect the 'clean' market from infiltration by the 'dirty' market, for consistent action to be instigated by the Commission and the Council in the Member States to make the private sector responsible through the adoption of rules, codes of conduct and other self-regulatory measures to complement administrative and criminal law measures taken by the state;

12.Calls for the problem of political and administrative corruption to be tackled by the Commission and Council as a 'matter of common interest' by developing appropriate initiatives both in the field of judicial and police cooperation and the rules on transparency and codes of conduct which administrations and political parties must establish;

13.Instructs its President to forward this resolution to the Commission, the Council, the national parliaments and the governments of the countries which have applied for EC membership.