Hollande under fire in ex-minister tax scandal

Hollande with Cahuzac at the end of a meeting earlier this year.

AFP/Reuters/Paris

French President Francois Hollande was forced to defend himself yesterday as critics questioned how much he knew about a secret foreign bank account that belonged to a former minister facing tax fraud charges.

Jerome Cahuzac – the minister responsible for cracking down on tax evasion until he resigned two weeks ago – was charged on Tuesday with “laundering the proceeds of tax fraud” after he admitted to having a foreign bank account containing some 600,000 euros ($770,000), following weeks of denials.

The affair looked set to leave a deeper stain on the ruling Socialist Party than the 2011 arrest of its one-time presidential hopeful, Dominique Strauss-Kahn, in a sex assault case.

Hollande appeared on national television yesterday to address the scandal, vowing a new law within weeks on the “publication and control” of the wealth of ministers and parliamentarians.

He said that he knew nothing of the foreign account and that Cahuzac “did not benefit from any protection” from the government.

“He deceived the highest authorities in the country: the head of state, the head of the government, parliament, and through them all the French people,” he said.

Hollande later travelled to Morocco, where the scandal – the biggest political crisis for the president since he took power last year – threatened to overshadow his landmark two-day trip to the former French colony.

The president had been quick to condemn Cahuzac’s actions, but critics have pounced on the scandal, saying that top officials must have been either lying to protect the former minister or naive enough to believe him.

Le Monde daily said he had dropped a bomb that had shaken Hollande’s authority.

The left-leaning Liberation ran one word, “Shameful”, over a front-page photo of Cahuzac looking sheepish.

Right-wing media compared the affair with France’s biggest sleaze scandals and ranked him alongside former US presidents Richard Nixon and Bill Clinton for public fibbing.

The head of the main opposition right-wing UMP party, Jean-Francois Cope, demanded Hollande explain the scandal to the French public.

Cope said that the president either “knew nothing, and that’s extremely serious because it means he showed a certain amount of naivete” or “he knew and that means he lied to the French people”.

“Who can believe that Francois Hollande and (Prime Minister) Jean-Marc Ayrault were aware of nothing?” Cope asked on Europe 1 radio.

Opposition lawmakers have called for a parliamentary probe into the scandal and for the resignation of Cahuzac’s former boss, Finance Minister Pierre Moscovici.

Marine Le Pen, the leader of the far-right National Front, said the entire government should resign and new parliamentary elections held.

“When we have this kind of situation of rupture, the people must be able to express themselves,” she said. “This abscess must be drained by new elections.”

Hollande had promised a government of unimpeachable morals, and the scandal is likely to further damage the standing of the president, who is languishing in opinion polls less than a year into his five-year term.

Former UMP prime minister Jean-Pierre Raffarin said that Hollande’s promises of reforms had not been enough to tackle the scandal.

“France is disgusted and so am I. The president’s statements were not at the level of the shock being felt,” he said.

“It’s devastating for public life,” Foreign Minister Laurent Fabius told BFM television, adding: “What is awful is to ask oneself what confidence public opinion is going to have in politicians.”

Socialist Party secretary Harlem Desir said that Cahuzac was no longer welcome in the party and advised him to give up his National Assembly seat for a southwestern constituency.

Government spokeswoman Najat Vallaud-Belkacem stressed that this was “a man, not an institution” that had lied.

“What shocks me is not so much that he had a bank account abroad but that he lied about it for so long and with so much conviction,” said Socialist voter Thomas Desternes, 36.

Le Parisien quoted a friend of Cahuzac as saying he had agonised for days as it became clear his lie would be exposed.

His former colleagues insisted they had been kept in the dark until he dropped his bombshell, and felt betrayed.

“We worked side by side with the kind of professional and human relationship two people have who spend 17 hours a day combing through public finances,” said Finance Minister Moscovici. “I put my trust in him and he did not respect it.”

A Harris Interactive/LCP opinion poll released yesterday showed 59% of respondents saying Hollande and the government had handled the scandal either “badly” or “very badly”.

Of the 1,182 polled, 75% said the scandal would hurt confidence in public officials.

Cahuzac announced his resignation on March 19 after prosecutors opened a probe into the account, first revealed by the investigative Mediapart news website in December.

He met investigators on Tuesday and admitted to having had the foreign account for around 20 years.

In a statement on his website, Cahuzac said: “I was caught in a spiral of lies and lost my way. I am devastated by guilt.”

Little-known before being named a minister, Cahuzac, 60, began his career as a cardiologist before switching to the more lucrative world of plastic surgery, in particular hair transplants.

Elected to the National Assembly in 1997, he headed its commission on public finances and was named budget minister when Hollande formed his first government.

He was in charge of a crucial programme to slash public spending by 60bn euros ($77.03bn) by 2017.

Le Parisien cheekily ran a photo of him speaking in November before a podium slogan entitled: “The fight against tax fraud”.

An amateur boxer who once slapped a disrespectful youth in the face during a political walkabout, he risks five years in prison and a 375,000-euro fine if charged and found guilty.