French leader of the French far-right party Front National (FN) Marine Le Pen | Jean-Sebastien Evrard/AFP via Getty Images Far-right groups ordered to pay European Parliament €800,000 Parliament seeks to claw back misused cash.

STRASBOURG — A foundation and a political alliance headed by Marine Le Pen's National Front have been ordered to pay back about €800,000 in EU grants to the European Parliament, according to a memo on the Parliament's 2015 report on political parties and foundations obtained by POLITICO.

This clawback of European Parliament cash by President Martin Schulz and Manfred Weber, leader of the center-right European People's Party, is the first crackdown against populist groups that use Parliament money to fund Euroskeptic causes.

"These foundations are a good way to promote Europe intellectually but then they use the money against Europe," said an EPP official.

The audit report, written by Parliament Secretary General Klaus Welle, does not directly name the rules broken by the offenders but invites the bureau of vice presidents to ask for more information.

Some of the infractions include using European funds to finance national parties and referendum campaigns. There's also failing to collect three or more bids on contracts for over €15,000. And in one case, Welle wrote that a foundation's president used its own companies to carry out services for the foundation, and the fees charged were more than 22 percent of the foundation's total expenditure.

In the memo to the vice presidents, delivered on September 5, Welle gave them three months to accept or reject the report. On Tuesday, they accepted it and Welle will now inform the parties and foundations of the decision.

At least one Front MEP has been notified of a preliminary procedure to reclaim Parliament funds.

Parliament sources told POLITICO that Schulz planned to announce the boost for the Parliament's coffers this week after a meeting of group leaders. A senior National Front official did not respond to a request for comment.

According to the report, the Movement for a Europe of Nations and Freedom (MENL), a Euroskeptic alliance led by Le Pen's partner, MEP Louis Aliot, owes the Parliament €535,818.97 from its annual grant. Two other organizations -- the Europe of Nations and Freedom political group, and the Organization for European Interstate Cooperation foundation -- owe the Parliament €248,893.72 and €37,788.24 respectively.

The MENL alliance includes France's National Front, Belgium's Vlaams Belang, Austria's Freedom Party, Italy's Northern League and the Czech Republic's Freedom and Direct Democracy party.

The European Democratic Party, associated with the Alliance of Liberal Democrats political group led by Guy Verhofstadt, owes the parliament €64,664.04. A connected foundation, the Institute of European Democrats, owes €16,874.99. The Europeans United for Democracy party, also connected to ALDE and the Nordic Left, owes the Parliament €19,548.25.

A Parliament spokesperson said: "Parties and foundations receive an advance of 85 percent of the money they think they need during a given year on the basis of a working program they submitted.

"At the end of the year, the parties and foundations submit the bills for the activities they organized to an accountant. Parliament's administration has another look. Money that has not been spent or spent on activities not eligible for subsidizing will need to be paid back. Or, if all bills are correct ... the remaining 15 percent will be paid out."

Le Pen funding crisis

If the clawbacks are confirmed, they will add to the legal and financial troubles of France's largest Euroskeptic party. Le Pen's National Front lacks more than €25 million that she would need to finance her presidential and legislative election campaigns next year. Losing regular revenue from the European Parliament would further complicate the party's situation.

In May, Parliament's bureau moved to dock the salary and expenses of her father, MEP Jean-Marie Le Pen, by €320,000 for misuse of his parliamentary assistant, a move that his lawyer is appealing before the European Court of Justice.

While the audit report does not specify whether the clawbacks are linked to the use of parliamentary assistants, Parliament sources said that several assistants linked to National Front MEPs had been questioned by the bureau in recent months following raids on party headquarters and associated offices in France.

An MEP close to Marine Le Pen said the party would contest any decision regarding the use of assistants and other Parliament resources before the ECJ.

At least one Front MEP has been notified of a preliminary procedure to reclaim Parliament funds, a party source told POLITICO this week.

The same source, an MEP close to Marine Le Pen, said the party would contest any decision regarding the use of assistants and other Parliament resources before the European Court of Justice, arguing that such decisions were politically motivated, aimed to penalize Euroskeptic groups, and drew a false distinction between assistants' local and parliamentary activities.

The source expressed confidence that the Front would not have to repay funds, but added that legal proceedings could tie up its senior members, distracting them from political work.

Polls show Marine Le Pen reaching the final round of France's presidential election next year, no matter who her opponent turns out to be.

This article was updated to correct a reference to Marine Le Pen, who is not the leader of the Europe of Freedom and Direct Democracy political group.

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