Sarkozy fights L'Oreal cash scandal

8th July 2010, Comments 0 comments

President Nicolas Sarkozy's government gained an edge Thursday in a scandal over alleged illegal campaign funding from France's richest woman, as fresh reports cast doubt on claims by her former accountant.

Judicial sources said police were set to question again Claire Thibout, ex-accountant of L'Oreal heiress Liliane Bettencourt, to verify her allegations that Sarkozy's presidential campaign took secret donations from the billionaire in 2007.

The scandal, which started with allegations over Labour Minister Eric Woerth's ties to Bettencourt, has threatened Sarkozy's flagship pensions reform project which Woerth is due to present to the government next week.

The story took a dramatic turn this week when the accountant told police that Woerth, Sarkozy's campaign fundraiser at the time, and Sarkozy himself received illegal payments in person, in envelopes stuffed with cash.

But in the latest twist, Le Monde newspaper reported Thursday that Thibout had recanted some of the allegations and the daily Liberation also said that doubts had emerged over her account to police.

Sarkozy and Woerth have furiously denied the charge, which is being investigated by magistrates, and the government hopes to ride out the storm and resume its legislative programme without losing any ministers.

Woerth will present his proposed pensions reform bill to cabinet next week, and in the meantime other developments appeared to give Sarkozy hope for a respite from the daily round of allegations.

Firstly, leaked copies of Bettencourt account books seemed to offer no concrete proof that large cash bank withdrawals had ended up in politicians' hands.

Secondly, a report by the government's financial watchdog was expected to exonerate Woerth on another related charge, that in his former role as budget minister he intervened to protect Bettencourt from tax audits.

Neither development draws a line under the scandal, and Sarkozy still faces his lowest ever approval ratings and labour union protests over the pension reform plan, but the government hopes to regain the initiative.

Meeting centre-right lawmakers Wednesday at the Elysee Palace, Sarkozy told them that he was confident that a report to be issued Friday by government financial inspectors would clear Woerth of a conflict of interest.

"If he did something wrong, I'll punish him, and if he didn't I don't see why I would punish him. But I'm pretty confident that they won't find fault," Sarkozy said, according to people present at the talks.

Woerth's wife Florence used to work for a firm that managed Bettencourt's 17-billion-euro personal fortune, which is under investigation after conversations secretly taped by a butler appeared to reveal tax evasion.

The minister -- who was at the time charged with leading France's fight against tax evasion -- has furiously denied suggestions that he used his position to protect his wife's client from investigation.

His wife has since resigned from the firm, while Woerth has said he will file a legal complaint for defamation over the allegations of secret political funding.

According to extracts of Bettencourt records seen by police and obtained by Liberation, Thibout did indeed withdraw 50,000 euros in cash from a family account on March 26, 2007.

Thibout has told police that this sum was given to Liliane Bettencourt, added to 100,000 euros that were taken separately from an account in Switzerland and then given to Woerth for Sarkozy's presidential campaign.

But, according to Liberation, there is no receipt to show that the 87-year-old heiress received the cash as a single sum.

"Nothing proves that Mrs Bettencourt made (illegal) political funding," Bettencourt's lawyer Georges Kiejman told a news conference.

Officials said police were to quiz Thibout later Thursday and she could be detained for further questioning.

© 2010 AFP

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