Three Socialist deputies spoke out after extracts from a Luxembourg police report published on Wednesday alleged that a company was set up with Sarkozy’s approval channeled money from arms deal commissions to fund political activities in France.
French investigators have since 2008 been probing allegations that the cancelling of commissions for one of the arms deals prompted an attack that killed 11 French engineers in Pakistan in 2002.
News website Mediapart quoted a Luxembourg police report as saying that Sarkozy oversaw the establishment in Luxembourg of two companies, Heine and Eurolux, when he was budget minister under former prime minister Edouard Balladur.
Balladur and Sarkozy, who served as spokesman for Balladur’s 1995 presidential campaign, have repeatedly dismissed allegations of illegal party funding.
But Mediapart quoted the Luxembourg police as saying: “The agreements on the creation of the two companies appear to have come directly from Prime Minister Balladur and Finance (Budget) Minister Nicolas Sarkozy.”
“Part of the funds that passed through Luxembourg came back to France to finance political campaigns in 1995,” added the police report, which cited unspecified documents.
Government spokesman Luc Chatel dismissed the recurring allegations as “a serial fairytale”.
But Socialist lawmaker Manuel Valls and the party’s deputy leader Harlem Desir called for French judges to obtain the Luxembourg police documents and shed light on the affair.
“Edouard Balladur and Nicolas Sarkozy, the budget minister who was in charge of the sale and the commissions, must be asked to provide all the information that the French are waiting for,” Desir added.
“The ministers at the time owe that to the French people and to the families of the victims” of the Pakistan killings, he said.
Balladur lost the 1995 presidential election to Jacques Chirac, who promptly cancelled commissions that were allegedly due to be paid to Pakistani officers.
In May 2002 a bomb in Karachi killed 11 French naval engineers who were in Pakistan to build the submarines.
A French judge investigating the attack suspects it may have been carried out in revenge for the cancelled bribes.
That claim was first raised by an internal inquiry carried out in 2002 by DCN, the French state-run shipbuilder that made the submarines.
DCN is linked to another case of suspect arms payments, having held a big stake in a contract for the French defence group Thales to sell warships to Taiwan in 1991.
Paris arbitrators last month ruled that illegal commissions were paid to help Thomson-CSF, which later became Thales, win the contract, and ordered Thales to pay hundreds of millions of euros in compensation to Taiwan.
A Socialist deputy who headed a parliamentary commission on the Karachi attack, Bernard Cazeneuve, was quoted by Le Parisien newspaper on Thursday as saying: “the government is doing everything to obstruct the truth.”
Sarkozy’s top adviser Claude Gueant on Thursday dismissed the latest claims as “imaginary constructions” by Luxembourg investigators who were not “rigorous” in their investigations, in comments quoted by Le Monde newspaper.
He said the practice of the budget minister authorising such deals was ended in 1992.
“The contracts were signed before Nicolas Sarkozy became budget minister,” he added.
Published in the Express Tribune, June 4th, 2010.
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