The European Union wants to grant itself the power to launch crime probes in Britain by creating a European Public Prosecutor.

Euro MPs voted yesterday in Strasbourg on legislation which would create a new body with exclusive powers to prosecute EU fraud and other crimes affecting the EU’s financial interests.

Conservative MEPs have warned this would mean a carte blanche for the EU to launch criminal investigations wherever it chooses: currently only national authorities have the right to investigate and prosecute criminal matters in their own country.

Timothy Kirkhope, the party’s euro spokesman on justice and home affairs, said concerns over fraudulent misspending of funds from Brussels was being used as an excuse to extend the powers of the EU where they did not belong.

“It has to be down to the British police and the Crown Prosecution Service to decide which crimes are investigated and prosecuted in the UK,” he said.

“Of course we strongly support the fight against organised crime and fraud and believe it has to be a political priority. But like colleagues in many other EU countries, we believe this proposal amounts to a costly erosion of our national sovereignty.

“There are already a number of existing agencies and pieces of legislation designed to address the issue of fraud. Member States who are failing when it comes to prosecuting and investigating fraud should be held to account through these existing mechanisms.

And after Liberal Democrat and Labour MEPs supported the move, giving the numbers needed to pass the legislation, he accused them of wanting to “hand Brussels a carte blanche to launch full-scale criminal inquiries on our soil.”

The proposal was also condemned by UKIP justice and home affairs spokesman Diane James MEP. She questioned the effectiveness of David Cameron’s opt-out.

“In theory the UK has exercised an opt-out for this proposal, but do not doubt that it will become law soon enough,” she said.

“The people best placed to investigate and prosecute crime whether it be fraud and corruption involving EU funds or anything else are our own police and UK prosecutors. This development raises the prospect of foreign Gendarmes being let loose in the UK armed with European Investigation Orders and European Arrest Warrants, raiding premises, intercepting communications and generally ordering our own police about.

“The real agenda here is to establish a pan-EU system of criminal law and criminal justice that is superior to the criminal legal systems of every Member State. It may start with fraud but it will not end there as ever more power is seized with the help of the likes of Miliband and Clegg.

“Furthermore, this whole exercise is an affront to democracy. The treaties say that this should only happen by unanimity. Several member states have vetoed the idea and fourteen national Parliaments have voted against it. But the EU simply thumbed its nose at the opposition and proceeded with the plan anyway.”