Head of government agency that handles refugee services says funding misuse needs to be investigated.

A senior Greek official has described the way the government buys migration-related services as “chaos,” after Greece’s top court ordered an inquiry into the handling of European Union funds paid to Athens to assist with the refugee and migration crisis.

Andreas Iliopoulos, the head of the government agency that registers refugees and migrants in Greece, says Greek and European taxpayers may be subject to fraud because many contracts are awarded directly without going through a competitive bidding process.

“[Fast-track procedures mean] I can go directly to interested parties. I can come to you and make a deal without revealing too much information to others,” Iliopoulos told Al Jazeera in an exclusive interview.

The so-called fast-track funding was introduced in 2015 at the height of the refugee crisis, but continuing with that policy is harder to justify now, said Iliopoulos.

“That makes sense when people are landing on the beach and we have to feed them and there are no obvious means of doing so.”

The money that's been spent on NGOs and the state doesn't justify what we're seeing right now Andreas Iliopoulos, former head of Reception and Identification Service

Greece depends on the EU to run services for about 60,000 asylum seekers and migrants who live in the country. The EU covers some 70 to 80 percent of costs.

Athens applies for the EU funding after it has already awarded contracts for services, and it could be months before it finds out if the EU will pay.

Iliopoulos said fast-track claims are more likely to be disqualified by the EU.

“When a funding request is rejected, it’s paid by Greek taxpayers,” he said. “Right now, it’s my impression that a sum of about 10 million euros ($11.6m) worth of funding claims may be dismissed for services like catering, sewage treatment and others.”

Iliopoulos first blew the whistle on the alleged corruption in the functioning of the Reception and Identification Service (RIS) in an interview with the Fileleftheros newspaper on October 4.

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Four days later, the Greek Supreme Court ordered an inquiry into the handling of European funds paid to Athens to assist the country with the refugee crisis of 2015-16.

The European Commission has allocated $1.8bn to Greece for migration-related costs for the 2014-2020 period, and has earmarked even more.

It’s unknown exactly how many Greek contracts the EU has rejected for co-funding.

Profit over quality

Al Jazeera has seen a number of directly awarded government contracts.

“We award this contract, through a process of negotiation, without the proclamation of a competitive bidding process,” is a typical phrase used to buy catering services and to rent housing.

These contracts can involve substantial sums. A 10-day contract to feed 8,300 people in Moria camp on the island of Lesbos, is worth 415,000 euros, or close to half a million dollars, minus a 4.2 percent tax.

None of the catering contracts seen by Al Jazeera contains specifications as to what food is to be served, only that the contractor must serve three meals a day and 1.5 litres of bottled water; so the contractor is able to expand its profit margin at the expense of providing quality food.

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Asylum seekers frequently complain about the food mess on the islands and use their own money to buy fresh produce to cook.

Iliopoulos says the contracts that brought his biggest disagreements with the government concerned sewage shipments from Moria camp to a treatment plant about four kilometres away.

“We can’t go on saying catering needs to be contracted under fast-track procedures, or sewage needs to be taken away by trucks at a cost that looks quite impressive on paper. This has to change,” he said.

Tents at a makeshift camp next to the Moria camp for refugees and migrants on the island of Lesbos [Giorgos Moutafis/Reuters]

Plans for a pipeline connecting Moria to the plant have been ready for at least two years, said Iliopoulos.

The regional governor for the north Aegean, Christiana Kalogirou, confirmed this, adding that trucks are not sufficient for the job.

“Not connecting Moria to [the plant] leads to the sewage being dumped in the surrounding dry river beds,” she told Al Jazeera.

“We have been forced in the interests of public health and the environment, to impose fines of 50,000 and 80,000 euros ($58,000 and $92,000) on the migration ministry because the water table is being contaminated.”

Kalogirou said pipeline construction has now been slated to start in December and is expected to take six months.

Iliopoulos said camp maintenance is sub-contracted to NGOs he cannot probe. “I’ve asked for the contracts we have with aid groups that receive EU funding,” he said.

“What do they do, exactly? … I’ve asked the [migration] ministry for this information. No one has given me an answer.”

Migration Minister Dimitris Vitsas declined to comment on the allegations.

Vitsas previously told a local Greek television channel that he tried to dismiss Iliopoulos after he first blew the whistle.

“I called him and told him that we cannot continue to work together … and because I respect him and his rank, I asked him to choose whether to resign or follow the severance procedure which would entitle him to compensation,” he said.

‘Broken system’

The launch of a judicial inquiry was the government’s second migration-related embarrassment in the past month.

On September 22, Defence Minister Panos Kammenos sued the Fileleftheros newspaper, for alleging that his ministry had mishandled funds for services meant for refugees.

Pictures on national television showed three journalists with their hands cuffed behind their backs being led into the Athens police headquarters. The journalists were released the same day.

“The prosecutor threw out the libel charge and ordered a preliminary investigation. He did not charge us,” says Fileleftheros’ editor, Panayotis Lampsias.

“Mr Kammenos tried to intimidate us, and through us, to silence the rest of the media. We don’t accept these threats. We continue to do our work.”

The European Commission said on September 26 that it had not found proof of wrongdoing, but had referred the matter to OLAF, the EU Anti-Fraud Office.

Vitsas defended the government in a second interview on state television on October 9.

“In the last three years, catering alone cost over 300 million [euros] ($347m), home rentals cost another 200-300 million ($232m-$347m), and if you add the construction costs for 34 reception centres, which at one point were as many as 40 … you’ll see that the total cost is not only justified, it is more than made up for.”

Iliopoulos insisted that the system is broken.

“What does this chaos enable? Certainly not oversight and spending money effectively. The money that’s been spent on NGOs and the state doesn’t justify what we’re seeing right now.”