Two French judges in charge of the political corruption case, Renaud Van Ruymbeke and Roger Le Loire, are searching for Abdul Rahman Al Assir, a Lebanese-born businessman and arms intermediary whose companies received millions of euros in commissions from the sale of French submarines to Pakistan and frigates to Saudi Arabia.
The two deals are at the centre of a far-reaching judicial enquiry into a suspected high-level corruption scam that has led to members of President Sarkozy’s close entourage being placed under investigation (1) – a legal status one step short of being charged – and which has thrown up evidence indirectly implicating the president himself.
The weapons sales are suspected of providing substantial illegal funds for former French Prime Minister Edouard Balladur's 1995 presidential election campaign. Between 1993 and 1995, Sarkozy was budget minister under Balladur, regarded as his political mentor, and he served as Balladur’s 1995 presidential campaign spokesman. Both Sarkozy and Balladur have denied involvement in the alleged illegal funding.
Balladur stood as a breakaway conservative candidate, betraying Jacques Chirac, who was running as the official candidate for the Gaullist RPR party, which Balladur had until then been a member of. His bid, which eventually saw him eliminated from the race in the first of the two-round vote, therefore had no funding from the RPR.
Van Ruymbeke and Le Loire suspect that Balladur’s campaign received financing through the siphoning-off of commissions paid in both the 1994 sale to Saudi Arabia of three Lafayette-class frigates and for the sale, that same year, of three French Agosta-class submarines to Pakistan. Their enquiries centre upon evidence that the showering of commissions – mostly bribes - paid to local officials, some went to intermediaries whose role was to send the secret sums back to France, via complex financial routes.
The French judges late last year stepped up their search for Al Assir, 61, one of two intermediaries who, on the behest of Balladur’s government, were placed as high-fee intermediaries in the weapons sales. The other was Ziad Takieddine, a Paris-based businessman and arms dealer who, as Mediapart has exclusively revealed, continued to act as an intermediary in weapons contracts mounted by Sarkozy’s political inner-circle up until 2009 (see a list of links to Mediapart’s series of investigations at the end of this article).
Takieddine was also last September placed under formal investigation for his suspected role in the corruption case. "I'm a much easier prey to reach than Monsieur Al Assir," complained Takieddine in a statement he gave to Judge Van Ruymbeke.
Acting on a request from judges Van Ruymbeke and Le Loire, Spanish police officers recently raided Al Assir's homes and company headquarters in Madrid, which they subsequently reported to be "unoccupied”. Mediapart has learnt from sources close to the case that Spain's special public ministry fighting corruption and organised crime informed the Paris-based judges that an international arrest warrant had been issued against the businessman for crimes "against the treasury and for money laundering". The warrant was issued across countries of the Schengen Zone on December 13th 2009.
It was Al Assir's three companies Rabor, Tesmar and Mercor that received the equivalent of 54 million euros in commissions from the Saudi and Pakistani deals, out of a total of 82.6 million euros. Some of that money was later given to Ziad Takieddine.
Some 32 million euros of those hidden commissions were paid to Al Assir and Takieddine’s network before the first round of the 1995 presidential election.
Two former senior officials at the state-run DCN shipbuilding company (now re-named DCNS), responsible for building the Agosta submarines, Gérard-Philippe Menayas and Emmanuel Aris, who were at the heart of the arms deal negotiations, have told the judicial investigation about a meeting with Al Assir at his Paris apartment on the avenue Henri-Martin, in the capital’s plush 16th arrondissement, in the spring of 1994.
During this meeting, Takieddine and Al Assir, who had both just been placed on the Pakistani submarine deal by the French defence ministry, demanded of the industrialists that they get 100% of their commissions immediately, which is a highly unusual move in such negotiations. The DCN officials insisted on handing over no more than 85% of the commissions. "The encounter was quite cold, brief,” recalled Emmanuel Aris in his evidence statement. “Monsieur Al Assir asked me to be more flexible in my attitude towards Monsieur Takieddine."
The investigation by Van Ruymbeke and Le Loire was prompted by evidence found in a separate ongoing judicial investigation in France into the 2002 murders of 11 French naval engineers in the Pakistani port city of Karachi, where they were helping to build one of the three Agosta submarines. It is from this case that the political funding scam has been dubbed in France as ‘the Karachi affair' (see a Q&A guide here and a video presentation here). The engineers were killed in a suicide bomb attack, and the investigation into their murders, led by Judge Marc Trévidic, has since uncovered strong evidence that the attack was in revenge for the non-payment of commissions promised to several Pakistani officials. The halting of the payments is suspected to have been the collateral result of the bitter political feud between Chirac and Balladur in 1995.
Van Ruymbeke and Le Loire have been told by former defence minister Charles Millon that one of Chirac’s first moves after becoming president was to order a review of weapons deals signed by Balladur’s government and the halting of all further commission payments in which retro-commissions were suspected. “Some contracts were confirmed, but, on the contrary, there were others which were the object of revision and even annulment,” Million said in a statement in November 2010. “That was the case of the Agosta contract."
1: Van Ruymbeke and Le Loire last September placed two longstanding close Sarkozy allies - Balladur’s former campaign treasurer, Nicolas Bazire, and a former advisor to Sarkozy when he was budget minister, Thierry Gaubert - under formal investigation for their suspected roles in managing the return to France of secret cash sums destined to intermediaries in the deals with Pakistan and Saudi Arabia. Bazir, 54, Managing Director of French luxury goods group LVMH, was Sarkozy's best man for his marriage to Carla Bruni in 2008. Gaubert, 60, is currently employed as communications director for the chairman of French banking group Banques populaires-Caisses d'épargne (BPCE).
Al Assir, Takieddine and Pakistan's 'Mr 10%'
It was in Spain that Beirut-born Al Assir made his name. During the 1980s he ran the Madrid arm of Triad, the group owed by the world's then wealthiest middle man, the Saudi dealer Adnan Khashoggi, whose sister Samira, he married. "Adnan Khashoggi, who knew the king [of Spain] very well, introduced him to the whole of Spanish society," a businessman close to the case told Mediapart, on condition of anonymity.
After his marriage to Samira ended, and following his subsequent remarriage, Al Assir’s relationship with Khashoggi became more distant, but he maintained his links with political leaders. At one point he obtained a 20% commission on a major arms sales to Morocco, paid by the Spanish National Institute of Industry, the Instituto Nacional de Industria.
Al Assir enjoyed close relations with former Spanish conservative leader and former Prime Minister, José Maria Aznar, whose daughter is married to one of his best friends, and the King of Spain. In 2004 the Spanish newspaper El Mundo reported how Al Assir had joined King Juan Carlos on a hunting trip to Hungary. Finally, during an investigation in 2008 the businessman was implicated in the collapse of the financial institution Banco Portugues de Negocios through which he is alleged to have misappropriated 42 million euros.
A somewhat shady reputation has followed El Assir over many years, accompanied by incidents such as the death in 1992 of one of his Egyptian associates, who was found in Madrid with his head trapped in a garage door.
In April last year, French police, acting under the orders of jusges Van Ruymbeke and Le Loire, searched the offices of the French national arms export agency, the Sofresa. There they found a report on Al Assir by the French foreign intelligence services, the DGSE, dated October 21st 1996 (see below). It cited an Italian diplomatic source as saying one of Al Assir's companies "might be acting as a front" for his brother in "illegal activities (arms sales and drugs in particular)". The document also alluded to a 1991 report by the CIA bureau at Rabat in Morocco which suspected the businessman of "being engaged in money laundering activities".
According to the DGSE, the French defence firms Dassault, Matra and Thomson, and also the state-run armaments export agency Sofma, had already used El Assir's services at the end of the 1980s, in particular in relation to the sale of Mirage 2000 jet fighters and AMX tanks to Peru and Morocco. The Mirage contract was to place him at the centre of an investigation in Peru targeting the country’s former president Alan Garcia for alleged corruption.
The DGSE noted that, in1996, Al Assir had "several passports all issued in his name: a Moroccan passport, a Lebanese passport and a Somali diplomatic passport".
Questioned by judges Van Ruymbeke and Le Loire on October 5th last year, Ziad Takieddine recounted how his business dealings with Al Assir began. “In March or April 1993 I was taking a plane from Nice to Geneva,” Takieddine recalled. “I recognised a friend from lycée [school] who I hadn't seen for 20 years, Al Assir. He had married Samira Khashoggi, Adnan Khashoggi's sister. They were very rich. I learnt that his marriage had ended badly and that his wife had killed herself. He later married the daughter of a Spanish ambassador. I explained to him that I was looking for work. He told me that he was operating between Switzerland and Madrid. He was talking to me in the manner of someone who wanted to impress. He had a boat, he lived in Gstaad, he had important contacts in Saudi Arabia including Sheikh Ali Ben Mussalam
, a minister of state and adviser to the [Saudi] king.”
Al Assir’s strong Saudi connections were also supported by statements given to the French judges by Takieddine's British former wife, Nicola Johnson. “It was Monsieur Al Assir who introduced Ziad into the world of contracts with Saudi Arabia,” she told them. In return Takieddine was able to offer Al Assir an entrée into the world of French politics, introducing him to Balladur’s defence minister, François Léotard.”
Al Assir introduced Takieddine to Sheikh Ali Ben Mussalam and also to Ali Zardari, now president of Pakistan, the husband of the former prime minister of Pakistan, the late Benazir Bhutto. In a separate statement last August, Nicola Johnson told the judges how Takiedinne met the Pakistani couple, which she said was between the end of 1993 and early 1994.
“It was in this period that Ziad travelled with Monsieur Al Assir to Islamabad to see Benazir Bhutto and her husband,” Nicola Johnson told the investigation last August. “I personally met [Mr] Zardari on the yacht that Monsieur Al Assir rented during the summer of 1994. This boat was at Antibes and was called the Rosen Kavalier.”
Al Assir's butler becomes Takieddine frontman
The closeness between Abdul Rahman Al Assir and Zardari, commonly nicknamed “Mr 10%” in Pakistan because of the numerous corruption cases that he has been linked to, is well established. In the middle of the 1990s, when the Bhutto clan had left government, numerous investigations were opened in several countries, notably Switzerland and Britain, over the financial practices of the former prime minister and her husband.
With the aid of bank documents, British judges were able to establish that, in the period 1994-95, Al Assir was one of Zardari’s principle providers of funds. Several millions of dollars sent from one of his accounts with Citybank in New York were found in Swiss bank accounts belonging to Bhutto and Zardari. A British investigation concluded that the money, sent via an offshore company called Bomer Finance Inc, came from corrupt activities and secret commissions.
Al Assir and Takieddine meanwhile forged closer business and personal ties, working together on major contracts for the Balladur government. El Assir's butler, Alain F. (last name deliberately withheld), who had previously worked for Adnan Khashoggi, was recruited by Takieddine as a frontman for the company that owned his Parisian apartment.
“In 1993, in Monsieur Al Assir's apartment, I met Monsieur Takieddine, who had just come to meet him, for the first time,” Alain F. Said in a statement given to the French judges. “Monsieur Takieddine told me that he wanted me to find him an apartment in Paris because he lived on the Côte d'Azur. He himself found a flat to rent on rue Raymond-Poincaré. Later he asked me to find him some [domestic] help, and then a cook.”
Subsequently Takieddine told him that “the group” - a reference to his partnership with Al Assir – was going to have to buy an apartment in the area. “I learnt that they were setting up in avenue Georges-Mandel, 400 metres from Monsieur Al Assir's place. Monsieur Al Assir told me that I could also take care of the [building] work at avenue Georges-Mandel.”
Enlargement : Illustration 3
The purchase price for Takieddine's property was 1.8 million euros, while the building and decoration work cost 6 million euros. Alain F. was not paid directly for his services, but Takieddine gave him his personal Mercedes 4x4 vehicle by way of compensation.
Takieddine's mysterious car crash
Takieddine and Al Assir continued their relationship well after their business deals with the Balladur government. In April 2004, Takieddine and his wife Nicola holidayed on the Caribbean island of Mustique in a luxury residence owned by Al Assir called Shogun. As Mediapart has previously reported, during the holiday, Takieddine was the victim of a car accident, when he received a life-threatening head wound and was saved with the help of Sarkozy aides. The incident, which involved no other vehicle or witnesses, has never been properly explained.
In an interview with French weekly le Journal du Dimanche, published in May 2010, Takieddine recalled: "In April 2004 I had a very strange car accident as I came back from the beach at Mustique. I don't remember anything, I was in a coma, given up for dead. Since then, I have been shown a report by the [French] intelligence services indicating that [someone] wanted to assassinate me.”
Meanwhile, judges Van Ruymbeke and Le Loire have attempted to seize property assets in France believed to be owned by Al Assir. But checks recently carried out on his Paris apartment situated on avenue Henri-Martin found that the six-room residence has become the property of a company called Fallway Group Holding, based in the Virgin Islands.
The judges also attempted the seizure of a large villa at Saint-Jean-Cap-Ferrat, on the French Riviera, which they suspected was part of his hidden property portfolio. However, a Cyprus-based company opposed the seizure, which was later rescinded.
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For more on the background to the issues raised in this article, click on the links below:
The Sarkozy aide and his secretly-funded Colombian mansion
Exclusive: British witness in French funding scandal hits back at ‘protected’ arms dealer
The arms dealer and his 'friendly' services for UMP leader Copé
French IT group Bull horned by libyan internet espionage deal
French judge finds key evidence in illegal funding probe
British divorcee becomes key witness in French political funding scandal
Net closes in on French presidency after funding 'scam' arrests
Arms dealer probe brings illegal funding scandal closer to Sarkozy
The British thriller writer caught in the plot of the Karachi affair
The secret financier who brings danger to the Sarkozy clan
Sarkozy, the arms dealer, and a secret 350 million-euro commission
The well-connected arms dealer and his tax returns
How Sarkozy aides saved arms dealer from paradise island 'death blow'
Exclusive: how Sarkozy's team sought grace for Gaddafi's murderous henchman
The arms dealer and his Paris party for the glitterati
Exlusive: how President Sarkozy's team dealt with Gaddafi
When Total paid the bill for the Elysée's secret emissary
How French intelligence shields the Sarkozy clan's unofficial emissary
Divorce court freezes arms broker's assets
The French-built stealth offroader that may be hiding Gaddafi
A Q&A guide to the Karachi affair
How the Karachi affair caught up with Nicolas Sarkozy
Senior French defence chief told of former PM's 'kickback scam'
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English version by Michael Streeter
(Editing by Graham Tearse)
- The original French version of this article can be found here.