tl;dr: Should I report this large grant fraud, and what consequences could it have for me?
For obvious reasons, I will try to maintain some anonymity here.
So I defended my thesis. Which was funded through a government grant.
In order to obtain this type of grant, a professor needs to cooperate with several other research organizations and privately-owned industries. Then it is required for some people to exchange between these places for extended periods of time. Relocate to a different place, live and work there.
So my industrious professor submitted all the required paperwork and received enough money to support multiple PhD students, post-docs and senior professors. However, almost none of them actually did any exchange. Instead, everyone just stayed at their home institutions.
Of course, I had no idea that the grant money was being mishandled until a monitoring meeting with the grant authorities that took place a long time after I started. All the other PhD students had no idea what was going on as well. We ended up making ridiculous statements about our accommodation, work hours, health insurance as the senior professors convinced us to lie about fictitious exchanges taking place.
The whole scheme is based on deliberate misinformation about people working at places they have never seen in their lives. I suspect a ton of papers and documents had been forged and submitted as evidence. The government thinks it's a research project with cooperation among multiple institutions. The only time we see each other is at set-up (pretended) conferences.
Naturally, all the documentation is kept secret, but a quick Google search would reveal that one can't simultaneously work at place x, and give lectures at place y, while x and y are hours of travel away. But again the people who control the grant money only check the paperwork they are provided. Is there a bogus employment contract in my name? I don't know but I have reasons to believe so.
Should I report this as a fraud?
There is an anti-fraud unit which should deal with it. This could, however, backfire in so many unimaginable ways. Forgery is rather a serious offense: a few PhD students and post-docs could end up being deported. More money is being awarded each year which could go to other researchers that are at least honest about what they spend it on. A funded PhD position is still available at my university, so more unsuspecting students will be involved.
I don't even know how I should approach this problem myself. It is an ethical dilemma as to whether I should support my supervisors. The procedure is definitely illegal, but the consequences could vary from not receiving future funding from the same source, to grant recovery (many millions of an unspecified currency) or even criminal charges. I can only speculate on what documents have been forged in the process, employment contracts, visa documents etc. A large number of involved researchers don't even live on the same continent, and that is where most of the money might go to. It is also very personal. Apart from being fooled with many false promises into writing a PhD, I did not sign up for, nor intended to, lie about living in a place I have never been to.