French minister partner's firm told to repay EU funds

3rd August 2010, Comments 0 comments

The European Court of Justice has ruled that a French group once run by the partner of Finance Minister Christine Lagarde poorly managed a million euros in EU funds and must pay the money back.

The court ruled that the Centre for the Promotion of Employment by Micro-businesses (CPEM), which was headed in 2003-2005 by Xavier Giocanti, should reimburse 995,527 euros (1.32 million dollars) in EU subsidies.

The Marseille-based organisation received exactly one million euros in 2002 in order to help unemployed workers by providing loans to help them set up small businesses.

But the EU's anti-fraud office opened an investigation after receiving complaints and in a 2006 report said it had found serious irregularities in the company's financial management.

The European Commission subsequently demanded that the money be reimbursed. The company filed several appeals against the decision, but was definitively ordered to pay up by the European Court of Justice.

Giocanti denied responsibility for the financial mismanagement in comments to France's Le Canard Enchaine newspaper.

"This does not concern me: I was appointed a salaried director at CPEM in 2003 and I left in April 2005," he told the weekly.

© 2010 AFP

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