Fraud and Undue Receipt of Public Funds: The Very Recent Supreme Court Ruling

The recent ruling by the Court of Cassation (Cass. pen., Sez. VI, Sent., n. 16979 of 23/04/2024) offers significant food for thought on the subject of fraud related to public funds, particularly those intended to support businesses during the health emergency. The decision deemed the aggravating circumstance of aggravated fraud not to exist against A.A., director of a company that received non-repayable contributions, clarifying the demarcation lines between the crimes of fraud and undue receipt of public funds.

The Case Under Review

The Court of Naples had confirmed the application of house arrest against A.A., charging him with undue receipt of public contributions, pursuant to art. 316-ter of the Italian Criminal Code. However, the Public Prosecutor argued that A.A.'s conduct should be classified as aggravated fraud under art. 640-bis of the Italian Criminal Code, as artifices would have been used to mislead the Revenue Agency.

• The first controversial point concerns the qualification of the crime: fraud or undue receipt?
• The second point concerns the precautionary measure applied, in relation to the maximum penalty provided for the charged crime.
• Finally, the third point concerns the aggravating circumstance related to the financial interests of the European Union.

The Court clarified that the undue receipt of public contributions does not automatically constitute the crime of aggravated fraud, unless specific elements of misleading the granting body exist.

The Decisions of the Court of Cassation

The Court granted A.A.'s appeal, declaring the Public Prosecutor's appeal inadmissible. In particular, the Court emphasized that A.A.'s conduct is correctly framed within the scope of undue receipt of public funds, as the Revenue Agency, according to current regulations, does not carry out prior checks on the applicant's self-certification.

Furthermore, the Court highlighted that the aggravating circumstance relating to the financial interests of the European Union could not be applied in the specific case, as the contributions received do not harm the Union's assets, but only those of the Italian State.

Conclusions

This Supreme Court ruling represents an important clarification in the context of public funds and related criminal liabilities. The distinction between undue receipt and aggravated fraud is fundamental to understanding the scope of current regulations and the legal consequences for businesses. It is crucial for companies to understand the risks associated with false declarations, but the ruling reminds us that the application of the law must be rigorous and without analogical extensions that could unjustly harm the individual.