The Sindicatura de Comptes (Public Audit Office) in the Balearics has delivered a report to parliament that points to potential fraud on a huge scale in respect of financial aid during the pandemic.
The report warns the government that if it is does not act quickly, thousands of possibly 'irregular' cases will have reached their expiry date under the terms of subsidies handed out and that there will then be no means of demanding the money back.
The Audit Office draws attention to a "total lack of control" in the verification of 865 million euros of aid for businesses. Over 10,500 cases have required review. To date only some 2,000 have been reviewed, the report acknowledging a lack of resources. Of a sample of 723 cases that were reviewed, 371 resulted in aid being returned to the government.
A lack of justification by businesses for receiving aid is the report's main concern, while it also points to the way in which aid was used to compensate debts between different businesses with the same ownership and to different amounts of aid that were requested for each of the establishments operated by the same ownership.
Another point concerns aid requests of 60,000 euros or more. These had to include audit reports confirming that the requests were correct. But some of them, despite having been supposedly audited, presented serious deficiencies.
A further issue highlighted in the report relates to the percentage of aid requests granted by different regional governments. In the Balearics this was 80%; there were 13,253 applications in all. By contrast, for example, the percentage in Valencia, where there was a government with a similar political party composition to that of the Balearics, was 53% (16,278 out of 30,648).
The report thus suggests that the previous government always showed its willingness to provide aid and that this helps to explain deficiencies with regard to internal control mechanisms.