Italy Seizes Ferries and Money on Charges of Public Corruption

The Italian police earlier this week swooped in on a ferry operator seizing vessels and assets on charges of public corruption. It is the second time in three years that the Caronte & Tourist organization and its senior executives have faced accusations of corruption as part of its successful 2016 bid to win lucrative government subsidies to maintain vital ferry services along the Strait of Messina, which separates Sicily and Calabria, and from Sicily to the outlying islands.

According to Italian media reports, officers from the Guardia di Finanza, which is responsible for dealing with financial crime, made the raids early on June 6. Three RoPax ferries, Ulisse, Helga, and Bridge, were each impounded and ordered to remain at the dock during the investigation. The ships provide vital transport services for residents to the outlying islands with the Helga sailing between Palermo and Ustica, the Bridge maintaining service to the Aeolian Islands, and Ulisse transporting goods recently also operating between Palermo and Ustica.

In addition to the vessels, the courts also ordered nearly €30 million in cash in the company’s bank accounts to be frozen. The decree issued by the judge in Palermo said that the assets would be held for a preliminary investigation of public fraud. Four of the company’s senior executives were also named in the investigation.

The company won a 2016 tender to supply various ferry services. According to media reports, many of the services are not profitable in the winter months but supply critical transport for goods and residents. Because it is considered to be a fundamental service providing transportation, Italy receives permission from the European Union to provide a subsidy to the operator. Reports indicate that the government provides a subsidy for the cost of operating the service that is not covered by the revenues.

As part of the winning tender, the company had to attest to or upgrade its vessels to ensure that they were accessible for physically challenged individuals. The ships needed to be able to provide easy transportation for people with reduced mobility, including the disabled and elderly.

Prosecutors argue that the vessels are not properly accessible and do not meet the standards of the tender and safety requirements. Further, they contend that the company has continued to commit fraud by never upgrading the vessels to meet the required standards.

Government officials are trying to work to minimize the disruptions to transport services in the wake of the seizure. Media reports highlight while volumes are low on the routes in the winter months, the ships are busy in the summer travel season, which is just beginning in Italy.

The Caronte & Tourist Group was founded twenty years ago merging two companies that date to 1965. They report that they transport approximately five million people a year and in addition to this operation also acquired another Sicilian ferry company Siremar. 

The company faced similar allegations in 2020 which also saw three vessels suspended and monies frozen. In 2021, the company was placed under judicial administration on charges of mafia infiltration. At the time, Italy's anti-mafia police alleged that an infamous Sicilian family had taken control of management and used their positions to contract out key services on the ferries, including lucrative catering, cleaning, and ticket booking services, to companies controlled by the mafia family.

With the government contract, Caronte & Tourist is reported to have a monopoly on the routes on the Strait of Messina and from Sicily.