Global Investigative Journalism Conference

Kiev - 2011

Agenda

• Europe’s Hidden Billions - who benefits from European Structural Funds?

– What are Structural Funds?– What we found– Our approach – Web and PDF scraping– Data analysis techniques (exclusion lists, watch lists)

Europe’s Hidden Billions

• €347bn over 7 years

• 12 member multi-lingual team

• 1 database

• Nearly 600 data sheets

• 21 languages

• More than 640,000 records

• More than 100 agencies

Europe’s Hidden Billions – What are the Structural Funds ?

• Europe’s second largest subsidy scheme – worth €347bn over 7 years (current funding round 2007-2013)

• More than 1/3 of EU budget

• Aims to redistribute Europe’s wealth and lift the economies of

its poorest regions

Europe’s Hidden Billions – Some of our findings

• Opaque – it’s extremely difficult for taxpayers to trace how their money is spent

• Bureaucracy means low uptake (at end of 2010 only 10% paid)

• Weak oversight system rarely punishes fraud

• Millions of euros continue to be siphoned off by organised crime

• Some of the biggest corporate beneficiaries are multinational corporations such as Nokia, Siemens, Fiat

• Companies relocating have obtained funding in contravention to rules

e.g. Twinings

Europe’s Hidden Billions – Fraud and mismanagement

• European Court of Auditors 11% ‘error rate’

• Errors and irregularities - €1.22bn / 2009: €109m suspected fraud

• OLAF – 20 fraud investigators; inefficient take long

• Ndrangheta (Italian mafia) fraud through law 488

• Idle desalination plant Illegal luxury hotels in Spanish UNESCO nature reserve

Europe’s Hidden Billions – Reaction

• Commission held a press conference and mounted up a full-blown public relations campaign in an attempt to counter our stories

• ‘FT is in cahoots with the UK government’

• European Parliament: the series was extensively referenced in committee hearings. MEPs have called for increased powers of independent parliamentary scrutiny over grant applications

Europe’s Hidden Billions – Is this transparency?

• No central database

• Neither Commission nor anti-fraud body has full overview

• Erratic level of disclosure

Europe’s Hidden Billions – How we did it

Beneficiary data600 + pdfs

Master Google spreadsheet

Database - server Dashboard (online)

search

Full export for macro analysis

Individual country files to correspondents

Numbers used in coverage checked with companies and authorities (shoe-leather)

Europe’s Hidden Billions – How we did it

Europe’s Hidden Billions – How we did it

• Web scraping (unPDF; AbbyFine reader with OCR)

• Data analysis tools

Europe’s Hidden Billions – How we did it

Excluded Parties List (US)

FT/BIJ database

EU Restructuring database

Debarment lists – not public for EU

WHY?

Europe’s Hidden Billions – How we did it

Europe’s Hidden Billions – the database