Monday

22nd Jan 2018

EIB silent on report into 'fraudulent' VW loan

  • Volkswagen "misled" the EIB when it received a €400 million loan (Photo: Nathan Lemon)

The European Investment Bank (EIB) does not want to explain why this website is being sent in circles when asking for a report on a loan which Volkswagen acquired by misleading the EU's bank.

The report, written by the EU's anti-fraud agency Olaf, was sent to the EIB in August. When this website asked Olaf if it could be made public, it referred queries to the EIB. When EUobserver asked the EIB, it referred back to Olaf.

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  • Taylor is one of the EIB's vice-presidents (Photo: European Commission)

This means that there is no public document which analysed what went wrong, or which could provide proof that the EIB has learned from the deception.

"I note what you say," said the bank's vice-president Jonathan Taylor, in charge of climate action, when this was put to him.

"I understand the point you are making. I don't have anything else to say about it," he said in an interview with EUobserver in Bonn, at the annual United Nations climate conference.

"As you might imagine, this is an issue with considerable ramifications, and I wouldn't want to say anything about it at this point, but I note what you say," he added.

Following the revelation in 2015 that Volkswagen Group (VW) had cheated on emissions tests, the EU's anti-fraud agency Olaf examined a €400 million EIB loan to the German carmaker, out of fear that its funds may had been used to support the development of the millions of diesel cars equipped with emissions-cheating software.

Although EIB president Werner Hoyer initially reported in early 2017 that the bank itself had "not found any indication" that part of the loan was used for fraudulent purposes, the more recent report by Olaf said that VW had "misled" the EIB.

News website Politico reported that according to anonymous Olaf sources, VW had received the loan through "fraud" and "deception."

Olaf's press office has refused to confirm or deny the content of that article on the record, but did say that it had sent "a judicial recommendation" to a German public prosecutor - which hints at possible criminal misconduct.

The EIB loan was signed in 2009 and has been paid back since. Taxpayer money was probably not involved, because the Luxembourg-based EIB usually borrows money on the market.

The bank is one of the world's largest lenders and only allowed to back projects that are in line with EU policy.

Fraud is fraud

Speaking in more general terms, Taylor said that the bank obviously also did not want to be the victim of fraud, but that the EIB was "never going to have a perfect system of defence."

"Fraud is fraud. Since fraud is, as it were, deliberate misuse of things, you are never going to eliminate it," said Taylor.

"You just have to keep learning. ... You need to look what happened, to see whether there are processes you could have put in place, procedures which you could have put in place, which might have reduced the likelihood of that fraud taking place. You just need to keep at it."

Following the non-release of the report, Olaf sent out a statement saying that it "recommended" the EIB that it "take active steps in implementing their anti-fraud policy."

Responding to that, EIB vice-president Taylor said the issue was "not binary."

"We have an anti-fraud policy. We are constantly taking steps to try and take it forward."

"It's not, as it were: 'here is our policy, now we sit on our hands and wait for somebody to tell us to do the policy, then they tell us to do the policy, and then we do it'. I mean, the anti-fraud policy is a continuous process, and we are constantly looking at ways in which we can [do that]."

So was Olaf's recommendation not useful, this website asked?

"I wouldn't say that. Every recommendation which we get from Olaf is always useful."

Investigation

EU probe into VW loan remains opaque

EU anti-fraud agency and European Investment Bank tight-lipped on report that said Volkswagen deceived the bank when acquiring a €400 million loan.

Investigation

Diesel cars still dirty, despite huge EU loans

The European Investment Bank lent billions to carmakers, in part to clean up diesel cars. But diesel cars are still dirty, prompting questions if the money was well spent.

Investigation

ECB in ‘bail-out’ of scandal-tainted VW

The ECB has started to “bail out” Germany’s Volkswagen Group by buying its corporate bonds, but other EU-linked banks continue to shun the scandal-tainted firm.

EIB 'more sensitive' to fraud after Dieselgate

The president of the European Investment Bank, Werner Hoyer, said the bank had high standards - but did not explain why an anti-fraud report on a loan to Volkswagen was being kept secret.

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