French politicians in cash scam trial

18th November 2003, Comments 0 comments

PARIS, Nov 17 (AFP) - A former French defence minister and the current spokesman for the country's ruling party went on trial in Paris on Monday accused of money-laundering and raising illegal party funds.

PARIS, Nov 17 (AFP) - A former French defence minister and the current spokesman for the country's ruling party went on trial in Paris on Monday accused of money-laundering and raising illegal party funds.

Francois Leotard, 61, defence minister from 1993 to 1995, and Renaud  Donnedieu de Vabres, 49, spokesman for the Union for a Popular Movement (UMP) of President Jacques Chirac, are charged in connection with a loan of five million francs (EUR 760,000 - USD 895,000) arranged for their now-defunct Republican Party (PR) in 1996.

Suspicions of money-laundering were raised because the loan from the Italian Social Fund for European Cooperation (FSCE) was matched by a payment to the fund of exactly the same sum made by the PR via an account in Luxembourg.

According to Leotard's lawyers, the money came from the so-called "secret  funds" - a discretionary cash supply kept by French prime ministers and used  among other purposes for paying bonuses to members of their cabinet.

"This had been going on for years - ministers always left with a sum of money for their party," said Bernard Gorny, explaining that Leotard had been  given the five million francs when he left office in 1995.

However prosecutors said the arrangement with the FSCE still amounted to money-laundering because there had been an attempt to conceal the source of  the cash, and that it was also a contravention of France's recently toughened rules on party-financing.

The case of the two politicans is part of a much larger trial into embezzlement and fraud at the FSCE which is expected to last several weeks.

Donnedieu de Vabres was required to stand down as European affairs minister in the government of Prime Minister Jean-Pierre Raffarin when he was placed under investigation over the affair in June 2002. Leotard served as the EU's  representative in Macedonia in 2001.

The system of prime ministerial "secret funds" was reformed by Raffarin's  predecessor - the Socialist Lionel Jospin - after Chirac claimed to have used some of the cash that he received when prime minister in the 1980s for luxury travel around the world. 

The PR formed part of the centrist Union for French Democracy (UDF) which split last year, most members joining Chirac's UMP but a rump remaining under former education minister Francois Bayrou.

© AFP

Subject: French news


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