Court to rule on France's decade-long Elf scandal


  • Business
  • Tuesday, 11 Nov 2003

PARIS (AP) - Political kickbacks, luxury villas bought with public money, illegal party funding.  

The corruption trial surrounding oil company Elf has already tarnished the French establishment and ruined careers. 

Now, the decade-long investigation into the former state-owned company comes to its climax Wednesday, with the announcement of verdicts in France's biggest-ever graft scandal. 

A total of 37 defendants have been on trial since March for their roles in the alleged embezzlement of some 300 million (US$345 million) from Elf during the late 1980s and early 1990s. 

Among them is a trio of former senior officials from Elf - now a part of the Franco-Belgian oil group Total - including ex-president Loik Le Floch-Prigent. 

The case has stained the reputation of France's political and business elites, raising damaging allegations of illegal party funding to both sides of the political spectrum and shining a spotlight on France's handling of its African oil interests. 

Convictions are inevitable for many of the key defendants, observers say. Le Floch-Prigent, 60, and his former No. 2, Alfred Sirven, have admitted some of the charges, faced with detailed evidence gathered during an eight-year probe. 

Sirven, now 76, is accused of running a network of bank accounts in Switzerland through which Elf money was channeled for "commissions'' and other murky payments. 

He has admitted appropriating 6 million (US$7 million) from Elf _ a small fraction of the 107 million (US$123 million) alleged - to support his sumptuous Paris lifestyle. 

The third member of the trio, Andre Tarallo, has denied all charges against him including allegations that he personally siphoned off 26 million (US$30 million) from Elf. 

Company funds were allegedly used to buy his 23-million (US$27-million) Corsican villa. 

Sirven and Le Floch-Prigent are already serving time after losing appeals earlier this year against separate convictions two years ago over the use of Elf money to "lobby'' then-Foreign Minister Roland Dumas by putting his mistress on the payroll and funding her lavish perks. 

The case and the revelations it brought to light effectively ended Dumas' career, despite his acquittal on appeal earlier this year. 

The three main defendants in the current case have argued that on joining Elf, they became part of a pre-existing system of bribes, commissions and fixing fees paid to foreign officials. 

Le Floch-Prigent also told the hearings early on that some US$5 million had been paid to French political parties during his 1989-1993 tenure at Elf, privatized in 1994. 

He said all the political payments had gone to the conservative RPR party of Jacques Chirac - now France's president - until the late Francois Mitterrand, Chirac's predecessor, demanded a cut for his Socialists. 

Le Floch-Prigent, Sirven and Tarallo have refused to name the recipients of alleged political payments in France throughout four months of hearings, but have spoken out more readily about their African activities. 

Le Floch-Prigent told the trial that money had been funneled to the leaders of Gabon, Cameroon, the Republic of Congo and Angola. 

"We know there were people between us and the leaders of these countries,'' he said. 

Co-defendant Tarallo, 76, known as Elf's "Mr. Africa,'' testified that he had opened several Swiss bank accounts for Gabonese President Omar Bongo, into which commissions were paid on lucrative oil deals. 

Bongo himself has vigorously denied receiving any money through the accounts. 

French prosecutors have sought to discredit the defendants' claims that they were acting as instruments of an "Elf system'' based on bribery and opaque political funding. 

Prosecutor Herve Robert said the three main suspects had "walked the path of personal enrichment and taken part in the systematic pillaging of the oil group, while hiding behind African alibis.'' 

Lead prosecutor Catherine Pignon has called for a five-year jail term for Le Floch-Prigent and eight years each for Sirven and Tarallo. 

Other defendants include former Elf refinery director Alain Guillon, accused of embezzling 24 million (US$28 million), and Le Floch-Prigent's ex-wife Fatima Belaid - who allegedly received 4.6 million (US$5.3 million) from Elf in exchange for her silence. - AP 

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