European citizenship is becoming an "increasingly important" way into the UK for non-Europeans in the wake of tighter immigration rules, Chief Inspector of Borders and Immigration John Vine has warned.
An inspection of how the Home Office handles European free movement applications found more than a third of European nationals - 36% - applying to stay in the UK were born outside the region and had gained European identity before arriving in Britain.
In addition, Mr Vine found they were often sponsoring non-European partners of their own original nationality or a similar cultural background.
In his report, Mr Vine said: "Our findings suggest that the European citizenship route is becoming an increasingly important way into the UK for those whose origins lie outside the EEA, particularly now that the Immigration Rules have been tightened.
"This was reinforced by the fact that 43% of those who were refused residence cards in our sample were either overstayers or illegal entrants."
EEA nationals and their family members may choose to apply to the Home Office for documents which confirm that they are exercising their free movement rights in the UK.
Mr Vine's inspection looked at the efficiency and effectiveness of the Home Office's handling of European casework, as well as steps taken to identify and tackle abuses, such as sham marriage.
For family members who are not European nationals, there can be significant benefits in obtaining a residence document, particularly if they would otherwise have no right to be in the UK, the inspector said.
Elsewhere, in a sample of non-European applicants, 43 of the 60 whose applications were refused - 72% - made repeat applications or appealed, which meant they could not be removed from the UK.
And inspectors found s ome cases, where there was suspicion of sham marriage, were not subjected to the appropriate level of scrutiny.
The report added that the Home Office targeted sham marriage and trafficking by organised crime gangs, but few lower-profile prosecutions to deter individual abuses had been conducted.
Caseworkers ran out of time to interview applicants and their sponsors because applications were still being worked on as a six-month deadline approached, the inspector added.
Mr Vine added: "I found that most of the decisions to refuse to issue documents were reasonable and there were effective processes in place to identify forged and counterfeit documents.
However, those practising deception were generally not prosecuted unless organised criminal gangs were involved.
"In January 2014, the Home Office brought in a new power to remove European Economic Area (EEA) nationals involved in fraudulent applications but I remain concerned about the general lack of prosecution and sanction against individuals found to have abused the system."
Keith Vaz, chair of the House of Commons Home Affairs Select Committee, said: "I am deeply concerned by these findings.
"It is vital that all applications for admission to this country are subjected to appropriate levels of scrutiny.
"We have seen during the passport crisis that standards of scrutiny for applications should never be lowered. This rule should apply across the board and backlogs are no excuse.