Dialogos

Millions Spent, System Failed: Audit Report Reveals Mismanagement at the Housing Finance Organisation

Published January 21, 2026, 06:00
Millions Spent, System Failed: Audit Report Reveals Mismanagement at the Housing Finance Organisation

A new report by the Auditor General reveals serious mismanagement and waste of public funds at the Housing Finance Organisation (HFO) regarding the procurement and installation of a new Banking Information System. The project, worth over €11 million, failed to be implemented, causing immediate damage to the HFO of at least €3.55 million. The report highlights irregularities in contract management, lost guarantees, and ongoing financial burden on the organization. The contract was signed in January 2019 with a scheduled completion date of January 2021, but implementation was not possible due to problems with the subcontractor and gaps in the HFO's administrative operation. The incomplete staffing of the Board of Directors and the lack of a General Manager hindered timely decision-making, while no measures were taken to address the situation. The project's failure forced the HFO to continue using KEDIPES infrastructure and upgrade its old system, incurring additional costs of at least €3.55 million for the period 2021-2025. Furthermore, dependence on KEDIPES extends to 2026, with additional costs exceeding €1.2 million. The report also denounces an irregular amendment to the contract in December 2024, which essentially limited the project to the utilization of existing equipment. The Auditor General describes the amendment as 'not lawful'. In addition, the HFO lost the right to seize a guarantee of €452,350 due to the non-termination of the contract, and omissions were found in obtaining approvals from the KEAΑ. The project's failure has serious operational consequences, as the HFO cannot offer modern banking services, reducing its competitiveness. The Auditor General emphasizes that this is a matter of strategic importance, as information systems are vital to the operation of credit institutions. The report has been sent to the Governor of the Central Bank, along with additional observations, paving the way for further audits and possible disciplinary action.