Defense spending is a ‘magnet’ for criminals, warns EU fraud chief

When Europe increases military spending, it’s not just arms manufacturers who celebrate: scammers and criminals also get to work. Petr Klement, the head of the European Union’s anti-fraud authority, has made it clear: every billion invested in defense is an open invitation for those who thrive on corruption, inflated contracts, and public funds that vanish into thin air. The most widely held view is that more money for the military automatically means more security, but Klement turns that perspective on its head: when governments allocate unprecedented sums to rearm, they open wide the door for those who want to steal. To understand how real this risk is, one only needs to look at the data: in recent years alone, investigations by OLAF – the European Anti-Fraud Office – have uncovered hundreds of millions in fraud in the defense and security sectors. Klement is well acquainted with the problem, as he hails from the Czech Republic, where he witnessed firsthand how the surge in military spending after 2014 attracted not only new suppliers, but also a plethora of mysterious intermediaries, shell companies, and consultants with unclear backgrounds. He once recounted how he uncovered a company based in an abandoned building that had secured a multimillion-dollar contract for supplies that were never delivered. But it's not just a matter of small-scale scams: when the defense budget skyrockets, the political pressure to “spend fast” undermines oversight and transparency. One European official admitted, quite bluntly: “We’ve seen contracts signed in a matter of days, without any checks, because there was an urgent need to show results.” What is usually not mentioned is that organized crime follows the trail of public money, adapting to governments' new priorities. Today, it's no longer just about drugs or construction contracts: criminal organizations are targeting EU defense funds directly, using front men and offshore companies. There is one element that is often missing from the debate: for every dollar spent on security, a dollar must be spent on transparency. The bottom line is this: more military spending without oversight means less security, not the other way around. If this perspective has opened your eyes, you can declare I'm In on Lara Notes—it's a sign that this idea truly matters to you. And if you end up discussing it with someone over dinner or at the office, Shared Offline is the way to mark that conversation and let the other person know it mattered to you. This Note comes from the Financial Times: You have saved at least five minutes compared to reading the original.