Berlin - Berlin prosecutors have rejected accusations by state economy minister Ramona Pop (Die Grüne) and the city's top culture official, Klaus Lederer (Die Linke) that they were unjustifiably investigating self-employed people who had applied for - but returned - emergency corona aid last year.

Berlin prosecutors are investigating 5,200 cases of suspected public aid fraud, including about 2,050 who returned the aid, spokesperson Mona Lorenz said.

People may have returned the aid because they determined after applying that they didn't qualify after all or because an outstanding invoice they didn't expect to collect on was suddenly paid.

Berlin politicians at the end of March 2020 created an aid programme for the self-employed and small businesses to quickly receive emergency funds. The state bank, the Investitionsbank Berlin (IBB), oversaw the programme and has since disbursed billions. Fraud cases quickly emerged in the days after the programme went live. The bank discovered it had paid thousands, for example, for companies that did not exist or were hastily set up just to get aid. 

"All exonerating circumstances will be taken into account"

"You commit fraud when you submit an application with false information and the funds have been disbursed," spokesperson Lorenz said Wednesday. "An investigation is launched if there is an initial suspicion".

"All exonerating circumstances are to be taken into account in the investigation, for example if an invoice was paid afterwards," she said, noting that the information could spark investigations to end the investigation or recommend a different charge. "Repayment cases are treated differently, of course, because damage compensation is generally taken into account in an exculpatory manner."

Politicans Pop and Lederer crticised the prosecutors in a Tuesday press conference.

"I believe the mere fact that one has paid back one's money cannot at all justify initial suspicion, and that it makes more sense to concentrate efforts on the real criminal behavior and not on people who are wondering why they now have to pay legal fees in the final phase of the pandemic," Lederer said. The investigations just create fear among people who initially found relief in the programme. 

Liquidity, not criminal suspicion

"That's the way we wanted it," he said. "What is actually going on at the prosecutor's office that these public resources are being used to run these proceedings?"

Pop said the idea of the aid was to ensure liquidity.

"That mechanism was intentional from the beginning. And to question that now, I find annoying and not right," she said. Of course fraud cases should be investigated, she said. "But to brand everyone who has voluntarily paid back as a potential fraudster is beyond what I envision politically here."

The IBB couldn't be reached for comment Wednesday. The bank has said it approved 213,000 applications for corona aid. A total €257.3m has since been repaid by 35,024 applicants, including €243.6 million by 34,738 applicants of the second round of emergency aid, which was specifically for the self-employed and small businesses.

At the beginning of December last year, IBB wrote to all 213,000 applicants, asking them to check their books to see whether they really needed the money paid out in the end. The result: IBB then received €56.3m back, or just under 23 per cent of the total aid paid out. 

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