The annual theft of EU funds is around €500 million, but a top European Commission official says the figure is likely in the billions.

“We have reasons to believe that the real figure is closer to billions than to millions,” Francoise Le Bail, who heads the commission’s justice directorate-general, told the European Parliament's civil liberties committee on Wednesday (18 September).

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The current €500 million figure arises from statistics sent to Olaf, the EU anti-fraud office, by member states, but Le Bail said national authorities do not have the right tools to make an accurate estimate.

Le Bail, along with Olaf boss Giovanni Kessler, spoke to MEPs to set out their case for tracking down those who steal EU money by setting up a new European Public Prosecutor's Office (EPPO).

The EU-wide prosecutor would be mandated to investigate fraud of EU finances, although the Lisbon Treaty says the office's power could be expanded at a later date.

The top prosecutor would be composed of a central office along with deputies or prosecutors from different member states. Most member states would also have an EPPO branch staffed with prosecutors selected by the respective national governments.

Kessler says the office is necessary because national authorities have a dismal track record when it comes to chasing down leads sent to them by Olaf.

“There is a non-uniformity by member states in their capacity and willingness to deal effectively with these kinds of crimes,” he said.

Conviction rates sent to Olaf over the past 13 years vary from less than 5 percent in some member states to over 90 percent in others.

Both Le Bail and Kessler said political will among some member states to stop the theft is either non-existent or primarily focused on a national perspective that fails to look at the transnational nature of the crime.

“Crimes which are committed by authors at the same time by different actors in different member states like corruption, like fraud involving European funds, are likely not to be discovered, not to be even seen or perceived by national authorities which only have a national fragmented perspective,” said Kessler.

Le Bail said the EPPO would be independent from national and institutional influence and would be accountable to budget overview by the European Parliament. The Court of Justice can also dismiss the prosecutor.

Most member states have expressed interest in the idea. But Denmark has opted out, with both the UK and Ireland likely to do so as well, noted Le Bail.

Deputies in the committee were largely supportive but questioned the scope of the proposal, its safeguards, and the new prosecutor's investigative powers.

Romanian Liberal MEP Renate Weber, who backs the idea, said there is a risk that a two-tier procedure on prosecution may emerge as a consequence.

“I cannot imagine that a bunch of prosecutors working for the European prosecutor will apply a certain procedure regarding the European financial interest and a different one regarding other crimes within the country,” she said.

For his part, German Green Jan Albrecht said his group backs the concept but noted that numerous questions remain, including the broad definition of investigative measures.

The European commission tabled the proposal over the summer with an aim to have the office operational at the start of 2015.