EU anti-fraud office recommends Poland repay €91m over irregularities in Ukraine aid procurement

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The European Anti-Fraud Office (OLAF) has recommended that Poland repay €91 million (380 million zloty) to the European Union after an investigation uncovered irregularities in the procurement of power generators for Ukraine.

The spending, part of an EU-funded project worth €114 million, was managed by Poland’s Government Agency for Strategic Reserves (RARS) under the former Law and Justice (PiS) administration.

In its investigation, OLAF found that “RARS’ procurement process violated transparency, competition, equal treatment, and financial management principles”.

That resulted in “contracts [being] awarded in a non-competitive manner, failing to ensure that the EU funds would reach their intended destination”. RARS also “issued large advance payments without sufficient guarantees, exposing EU funds to significant financial risks”.

Meanwhile, “some contractors charged RARS up to 40% more than their purchase costs, leading to substantial overpricing of the EU-funded generators”.

Finally, OLAF noted that, after it launched its investigation in July 2023, “RARS at the time refused to cooperate with OLAF despite their obligations under the EU grant agreement”. PiS left office in December 2023 and was replaced by a new coalition government led by Donald Tusk.

In addition to recommending the recovery of €91 million, OLAF also announced that a further €22 million had been secured against wrongful expenditure. However, it is now up to the relevant EU and national authorities to decide on whether and how to implement OLAF’s recommendations.

“We need every euro of EU support to Ukraine to reach those in need and guarantee that our taxpayers’ money is duly spent,”said OLAF’s director general, Ville Itälä. “Protecting EU aid to Ukraine not only guarantees our taxpayers’ money is duly spent but is also a matter of our security.”

The EU agency noted that it has worked closely with Poland’s Central Anti-Corruption Bureau (CBA) and Public Prosecutor’s Office, resulting in the arrest of at least three individuals. It did not, however, provide further details of the detainees or the charges they are facing.

Last year, the former head of RARS from 2021 to 2024, who can be named only as Michał K. under Polish privacy law, was accused by Polish prosecutors of participating in an organised crime group, failing to fulfil his duties, and exceeding his powers for financial gain.

According to news website Onet, among the allegations against Michał K. are that he bought power generators for inflated prices and that, instead of delivering them to Ukraine, he gave them to electoral districts in which PiS politicians – including Michał K. himself – were standing for election.

Michał K. has denied the claims, issuing a statement to news website Niezależna saying that they are “false accusations” and part of a “dirty political game”. Last September, Michał K. was detained in London and Poland has requested his extradition.

Commenting on OLAF’s findings, the EU minister in Poland’s current government, Adam Szłapka, told Polsat News that they were “shocking”

“OLAF is a completely independent institution,” said Szłapka. “It has prepared a report which is basically an indictment showing favouritism to its colleagues.”

Poland is now awaiting OLAF’s formal submission of the report, which Szłapka said would be “very serious evidence for prosecutors” investigating RARS’s handling of procurement under the former government.

Notes from Poland is run by a small editorial team and published by an independent, non-profit foundation that is funded through donations from our readers. We cannot do what we do without your support.

Main image credit: European Commission (under CC BY 4.0)

Alicja Ptak

Alicja Ptak is senior editor at Notes from Poland and a multimedia journalist. She previously worked for Reuters.