(ZENIT News / Luxembourg, 12.08.2024).- What began as an investigation focused on an employee of Caritas-Luxembourg, allegedly implicated in a diversion of funds, has evolved into a wider inquiry that points to external actors. In a statement on August 6, Luxembourg’s Prosecutor’s Office suggested that the fraudulent transfers, which amount to 61 million euros, might be linked to a way of fraud known as “the President’s fraud.” This type of fraud is based on the manipulation of key employees to effect money transfers under false pretences.
It has been reported that diverted funds were transferred to accounts in Spain in lower amounts of 500,000 euros between February and July of this year, which indicates a systematic fraud process. Although specific details about how the fraud was carried out have not been confirmed by the Authorities, the case has sparked a media storm in Luxembourg and raised serious doubts about the supervision of charitable organizations in the country.
The impact of the scandal in Caritas-Luxembourg has been significant. The organization, which employs 500 people and operates in both Luxembourg as well as in 10 other countries, now faces a confidence crisis. In face of the uncertainty of its capacity to continue paying salaries and maintaining its services, Caritas announced on July 31 the creation of a Crisis Committee headed by Christian Billon, former chartered auditor, with the objective of restoring the organization’s credibility. Moreover, PwC Luxembourg has been contracted to carry out an exhaustive audit that will clarify the facts.
For its part, the Luxembourg Government has taken a firm position. In a meeting with top officials of the Government, Prime Minister Luc Frieden said Caritas will not receive further public funds until the situation is clarified. A monitoring committee has been established to address the legal and practical implications of the case, and several options are being considered to ensure the continuity of the services that Caritas offers in the name of the State.
The scandal also coincides with Pope Francis’ forthcoming visit to Luxembourg, planned for September 26. During his visit, the Holy Father will meet with the Prime Minister, the Grand Duke Henry and the Catholic community in the Notre Dame Cathedral. The Archdiocese of Luxembourg, headed by Cardinal Jean-Claude Hollerich, has followed closely the crisis in Caritas, although it has made no public comments about it.
The case has unleashed a wide debate in Luxembourg about the need for greater transparency and control in the running of organizations that manage public funds, especially those that, like Caritas, play a crucial role in assistance to the neediest.
