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France

Sarkozy defends labour minister over heiress scandal

Text by News Wires

Latest update : 2010-06-26

French President Nicolas Sarkozy has come to the defence of Labour Minister Eric Woerth, whose wife has been accused of turning a blind eye to tax fraud by L’Oreal heiress Liliane Bettencourt, France’s wealthiest woman.

AFP - French President Nicolas Sarkozy on Saturday defended his under-fire Labour Minister Eric Woerth who, along with his wife, is embroiled in a row over tax evasion by France's richest woman.

"The president has absolutely nothing to reproach Eric Woerth for. One cannot reproach him. He's an excellent minister," a spokesman at the Elysee presidential palace told AFP.

Woerth, a high-flyer in Sarkozy's right-wing government, has denied his wife Florence turned a blind eye to tax evasion as she helped manage Liliane Bettencourt's 16-billion-euro (19.8-billion-dollar) fortune.

Florence Woerth has also vehemently denied being aware of any financial fraud on the part of Bettencourt, the 87-year-old L'Oreal heiress, but said she would step down from her job after the allegations surfaced.

Woerth is a rising star in Sarkozy's government who was known as "Mr Clean" and in a previous post led a major crackdown on tax evasion.

Despite Sarkozy's support, the head of the centrist Modem movement, Francois Bayrou, said the Bettencourt affair had "weakened" both Woerth, who is in charge of sensitive retirement reform, and the government.

"I think that the situation is made much more complicated by what's happening," Bayrou told journalists in parliament on Saturday.

"I think that it's very difficult to be in charge of a dossier like that of retirement while being the subject of revelations every day," he said, adding that "all of the government" had been weakened.

"I'm not one of those seeking his (Woerth's) resignation. The composition of the governmental team is the responsibility of the head of state. But the French people can see there's a problem."

Bettencourt has been at the centre of a political storm since last week when secret tapes revealed she had allegedly conspired to hide money in Swiss bank accounts while making donations to friends in Sarkozy's UMP party.

Bettencourt pledged on Monday to declare all of her foreign assets, which include millions in Switzerland, to comply with French laws.

The tapes are the latest twist in a long-running family feud between the billionaire and her daughter, who claims Bettencourt is mentally unfit after she gave more than a billion euros to a photographer friend, Francois-Marie Banier.

On Friday prosecutors in the Nanterre suburb of Paris said they had alerted tax authorities in January last year of possible financial fraud in the case.

Woerth said he had personally ordered a tax probe of Banier last year, while the director of public finances in the budget ministry, Philippe Parini, said he had received no instructions from Woerth regarding Bettencourt.

The Elysee spokesman denied that prosecutors had raised the alarm about Bettencourt, and said that he tax affairs and Baniers were separate issues.

Banier is set to go on trial in Nanterre next Thursday on charges he took advantage of Bettencourt.
 

Date created : 2010-06-26

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