The European Public Prosecutor’s Office (EPPO) has opened a formal investigation into InnoEnergy, one of the EU’s flagship clean technology investors, over allegations of financial irregularities, misappropriation of public funds, and VAT fraud.
Since 2010, the Netherlands-based organisation has received around €760 million in EU public funding through the European Institute of Innovation and Technology (EIT).
It positions itself as a key driver of Europe’s green transition, backing hundreds of clean tech start-ups and leading initiatives such as the European Battery Alliance.
The probe was triggered by a complaint filed in March 2026 by Swedish entrepreneur Lars Walldén.
Walldén’s company, Northstar Telemetrics, was one of the early start-ups supported by InnoEnergy under a 2011 “business creation service agreement.”
What began as a promising collaboration turned sour when a dispute over a new contract escalated.
Walldén claims InnoEnergy instructed him to issue false invoices as part of internal accounting practices, which he says amounted to misappropriation of EU funds and VAT fraud.
After he refused and raised concerns, InnoEnergy sued him personally for €200,000.
His complaint to the EPPO ultimately prompted the formal criminal investigation into both InnoEnergy’s Dutch headquarters and its Spanish subsidiary.
In an interview with Follow the Money, he said the experience “destroyed my company and caused 10 years of personal suffering”.
InnoEnergy has been one of the most important early backers of the Swedish battery champion Northvolt, investing millions of euros in the company’s early stages, recycling projects, and expansion plans. Northvolt is now bankrupt.
‘Green’ darling Northvolt faced seizures by the Swedish Enforcement Authority, Kronofogden, the country’s debt collector, over unpaid bills. https://t.co/zNIv3UH9gW
— Brussels Signal (@brusselssignal) January 16, 2025
The EPPO’s investigation covers both InnoEnergy’s Dutch parent company and its Spanish subsidiary.
According to reports, it examines whether public money was improperly used and whether VAT rules were circumvented through questionable invoicing practices.
The fraud probe comes on top of earlier revelations about InnoEnergy’s compensation practices.
InnoEnergy’s former CEO Diego Pavia and current CFO Bart de Beer have together received more than €9.2 million in total remuneration since InnoEnergy was founded in 2010.
They received high bonuses and benefits, even in years when it reported heavy losses. Governance experts have described these payments as raising “moral reservations,” especially for an entity almost entirely reliant on taxpayer money.
InnoEnergy has so far declined detailed comment, stating only that it is not aware of any EPPO investigation involving the company.
Prior reporting by Follow the Money revealed a pattern of questionable performance claims by InnoEnergy raising questions how it has accounted for hundreds of millions in public money.
The organisation has claimed to have trained over 100,000 people for Europe’s battery industry, a figure that independent scrutiny found to be unreliable and unsupported by verifiable data.
Separately, InnoEnergy projected that its portfolio companies would deliver 2.3 gigatonnes of CO₂ reductions by 2030 — an estimate described by experts as unrealistic.
InnoEnergy was designed to act as a bridge between public funding and private innovation, yet critics argue that weak accountability mechanisms have allowed problems to fester.
An investigation does not mean the company has been found guilty of any crime and involved persons are presumed innocent until proven guilty by a court.
Brussels Signal reached out to InnoEnergy but did not receive a reply at the time of publication. The EPPO and the European Commission declined to comment.
