Defense giant Thales refutes corruption charges

26th September 2005, Comments 0 comments

PARIS, Sept 26 (AFP) - A former executive of French defence and engineering giant Thales has accused the company of organising a centralised slush fund to bribe and corrupt officials to win contracts, in an interview published Monday in the French daily Le Monde.

PARIS, Sept 26 (AFP) - A former executive of French defence and engineering giant Thales has accused the company of organising a centralised slush fund to bribe and corrupt officials to win contracts, in an interview published Monday in the French daily Le Monde.

The company issued a formal denial of the story, stressing that Michel Josserand, former head of Thales' engineering and consulting unit, had been sacked for his involvement in "irregularities".

It also filed a complaint against Le Monde and Josserand for defamation.
 
"The Thales Group has ascertained the full extent of the accusations of corruption in France and internationally, brought against it by Michel Josserand, a former manager at THEC (Thales Engineering and Consulting), published in Le Monde of 26 September 2005," the group said in a statement.
  
"The Thales Group has decided to take immediate legal action for defamation against the French daily newspaper Le Monde and Michel Josserand."
  
Le Monde said it did not wish to respond "before knowing on which basis the complaint had been constituted".

In comments published by Le Monde, a respected French daily, Josserand alleged that Thales had constructed a secret internal system to pay commissions that totalled as much as two percent of the company's annual sales.

Last year, Thales posted sales of EUR 10.5bn.

Josserand said the system was known only to a few people in the Thales holding company, Thales International, and the executives at the top of the group.

The accusations shocked Josserand's current employer, the European Aeronautic Defence and Space Company (EADS), which said it might fire him.

"EADS is extremely shocked by the many fallacious allegations in this article, as well as by the accusations against a major partner company of our group," the aeronautic firm said in a statement.

"EADS considers that such declarations characterize inacceptable professional behaviour which could only lead it to consider dismissal proceedings against him (Josserand)," and "does not exclude other actions if necessary".

EADS has suggested several times that it would like to buy Thales.

Josserand first accused Thales of corrupt practices during an investigation into the attribution of contracts for a tramway system under construction in the French town of Nice.

Magistrates in Paris opened an investigation in July as a result of Josserand's claims, but the interview on Monday was the first detailed description of the alleged system.

In a strongly worded denial, Thales said: "Thales Group formally denies accusations of corruption in France and internationally ... The group would like to point out that these allegations have been made by a former manager of this subsidiary, who was dismissed by the group for irregularities committed as part of a contract for the Nice tramway. Furthermore, the group itself lodged a complaint regarding corruption during this project."

Shares in Thales had fallen 1.22 percent in mid-afternoon European trade to EUR 38.14. The CAC 40 index of leading shares was up 1.55 percent to 4,546.46 points.

Copyright AFP

Subject: French news

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