Labora tightens employment subsidy conditions following massive fraud uncovered in Elche

Elche's massive fraud related to subsidies granted by the Generalitat to promote employment has prompted the Consell to take immediate action. Labora, the Valencian Employment and Training Service, has strengthened control measures to prevent further instances of misconduct.

This was confirmed by the Regional Secretary of Employment, Antonio Galvañ, who recalled that the business network dismantled by the Civil Guard profited from grants awarded during the Botànic administration, co-financed by the Generalitat Valenciana and the European Social Fund. Galvañ explained that the complaint was filed with the Civil Guard by Labora's territorial directorate in Alicante, which detected potential irregularities involving 11 companies based in Elche.

The Regional Secretary of Employment detailed that the events under investigation occurred between 2021 and 2022. Specifically, Labora identified suspicious activities in certain aid programs for hiring unemployed individuals (Ecovul, Ecogju, and Ecovut).

It was found that workers were being laid off and moved to other companies where subsidies had also been requested, with similar sectors and operational methods. Some companies would apply for aid and close before the two-year period ended. Interestingly, the administrator was often the same, as noted by the Valencian Government.

In response to this modus operandi, Galvañ emphasized that the regional administration has increased the requirements for accessing subsidies and established more anti-fraud controls. These include investigating connections between companies or requiring that no indefinite contracts have been signed in the three months prior to the formal application submission.

The Regional Secretary added that the aid calls have been changed and the amount granted per worker has been reduced from 28,000 to 10,000 euros this year. This, he highlights, has made defrauding less profitable. Additionally, the maintenance of the subsidized employee's registration is verified during the two-year obligation period.

"It is regrettable that companies and individuals are using the aid meant to promote employability for those struggling to find work for their own fraudulent benefit," Galvañ reproached, assuring that "the Consell will further ensure that subsidies reach those who truly need them."