More than 40 dawn raids were carried out in four countries yesterday by police investigating alleged Mafia involvement in European Union security and building contracts worth millions of euros.

At least three people were arrested after 150 officers in Belgium, France, Italy and Luxembourg swooped on the homes of European Commission officials, banks, companies and an office of a Member of the European Parliament. Two Italian MEPs were said last night be at the centre of the three-year investigation.

The raids came just two days after a lavish party in Berlin and other European capitals to celebrate the 50th anniversary of the founding of the EU. They served as a reminder of the massive potential for fraud in the organisation’s €115 billion (£77.8 billion) budget.

The remit of the police investigation is wide and covers possible corruption involving European civil servants, criminal organisations, breaches of professional secrecy and violations of public procurement rules.

At the heart of the inquiry are the conditions under which certain European public procurement contracts were awarded. The contracts were for buildings to house European Commission delegations in France, Italy and Luxembourg and the installation of security equipment in the offices.

A dozen of the raids were carried out by the Italian Carabinieri and one official, Laurence Wittek, said: “The investigation is about two Italian members of the European Parliament suspected to have ties with the Mafia.”

The European Parliament could not confirm this last night but said that one of those questioned yesterday was an MEP’s assistant.

A spokesman for Hans-Gert Pöttering, the President of the European Parliament, said: “Belgian police came to the Parliament to speak to a parliamentary assistant. The Parliament is giving the Belgian authorities every assistance with their inquiry.”

The prosecutor’s office in Brussels said that the raids involved international police and officials from the EU’s own antifraud office, Olaf.

“The investigation involves suspected bribery of European civil servants, forming a criminal organisation, violating professional secrecy, breaches of public tender laws and forgery,” the prosecutor’s office said in a statement.

It concerned the award of tenders for European Commission “embassies” abroad and contracts for installing security systems for those offices, the statement said. “European Commission civil servants as well as the directors of companies that won tenders are suspected of being implicated in fraud.”

The Advocate-General of Luxembourg confirmed that he had received and agreed to a request from Belgian prosecutors to search the European Commission’s office of infrastructure and logistics in Luxembourg.

The European Commission refused to confirm any details of those taken into custody. “Until the investigation is concluded and the facts are fully established, the presumption of innocence applies,” said Johannes Laitenberger, the Commission’s spokesman.

“The Commission is collaborating fully with the national authorities carrying out this inquiry in the interest of shedding full light on the allegations and suspicions that exist.”

Berta Bernardo-Mendez, the examining magistrate, will have to decide early this morning whether there is sufficient evidence against the officials who were arrested. “If she believes that there is, they will be transferred immediately to Foret prison,” said a spokesman for the prosecutor’s office in Brussels.

The EU’s image has suffered increasingly from fraud over its 50 years. The most notorious episode brought about the mass resignation of the entire European Commission.

Edith Cresson, the former French Prime Minister, who served as research and education commissioner in Brussels from 1995 to 1999, was accused of hiring a dentist from her home town as an advisor, despite being warned it was against EU rules.

The scandal eventually led to the collective resignation of the Commission and its President at the time, Jacques Santer, in March 1999.

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