French former officials go on trial over alleged kickbacks in 'Karachi affair'

Three top former French government aides went on trial Monday charged with arranging a system of kickbacks on arms deals with Pakistan and Saudi Arabia in the 1990s.


The trial is the first to arise out of a sprawling investigation into the so-called Karachi affair, named after the Pakistani city where a bus carrying French defence engineers was blown up in 2002, killing 15 people.

Al-Qaeda was initially suspected of the attack, but the focus later shifted to the arms deals amid suspicions the bombing may have been revenge for non-payment of promised bribes.

A total of six people went on trial in a Paris criminal court Monday on suspicion of misappropriating part of the proceeds from the arms deals. They included three former government aides who served under conservative ex-prime minister Edouard Balladur.

Balladur, 90, was himself last week ordered to stand trial over claims that he used some of the kickbacks to fund his failed 1995 presidential bid. 

The three aides are Nicolas Bazire, Balladur's former campaign manager; Renaud Donnedieu de Vabres, a former advisor to his defence minister Francois Leotard; and Thierry Gaubert, a former aide to then budget minister Nicolas Sarkozy. 

Also accused are Dominique Castellan, a former head of the international division of French naval defence contractor DCN (since renamed Naval Group), and two Lebanese middlemen who allegedly acted as go-betweens for the bribes and kickbacks -- Ziad Takieddine and Abdul Rahman El-Assir. 

El-Assir was not present at the start of the trial.

Chirac ended arms bribes       

Paying bribes on arms deals was common practice when Balladur's government won contracts to sell submarines to Pakistan and frigates to Saudi Arabia in 1994.

Earning kickbacks on the deals was banned, however. 

Investigators suspect the French of having paid some 327 million euros ($359 million) in bribes on the deals, including some 13 million euros in kickbacks.

After defeating Balladur for the presidency in 1995, Chirac ended the payment of all remaining commissions on the deals.

Balladur has denied knowledge of any commissions or kickbacks and said he was not responsible for the "details" of the financing of his presidential campaign.

He and his former defence minister Leotard, 77, have been charged with complicity in the alleged misappropriation of part of the proceeds of the arms deals.

Both will be tried by the Court of Justice of the Republic, a separate tribunal that hears cases of alleged misconduct by ministers and prime ministers in the course of their duties.


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