Disgraced French budget minister Jérôme Cahuzac stands trial

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The trial of the 63-year-old, who Mediapart revealed held a secret tax-dodging account in Switzerland for more than 20 years, opened in Paris on Monday.

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Former French budget minister Jerome Cahuzac, whose tumultuous resignation in 2013 over a secret Swiss bank account rattled France’s Socialist government, goes on trial Monday for tax fraud, reports FRANCE 24.

The 63-year-old faces up to seven years in jail and two million euros ($2.2 million) in fines if found guilty of stashing offshore his earnings from a lucrative hair-transplant business he ran with his now ex-wife.

A media scrum is set to descend on the court for the start of the trial, even if the opening defence gambit is expected to prompt a delay of several months.

The Cahuzac scandal dominated headlines for weeks, tarnishing the presidency of François Hollande, who had promised a squeaky clean government after succeeding Nicholas Sarkozy, the subject of several graft investigations.

As Hollande’s tax tsar, Cahuzac had been in charge of the crackdown on wealthy tax avoiders promised by the Socialist candidate during his election campaign.

Hollande initially backed Cahuzac's vehement denials after the Mediapart news website first broke the story in December 2012, posting a compromising audio recording.

Cahuzac promptly lodged a defamation suit against Mediapart, denying the accusation for months and solemnly vowing in parliament that he had no secret bank accounts.

But the trained surgeon, while still protesting his innocence, resigned his post after a formal investigation was launched in March 2013.

Two weeks later, he dramatically confessed to having held the account with Swiss banking giant UBS and said he was "consumed by remorse".

Cahuzac was immediately hounded by the media in the immediate aftermath, telling a newspaper he had to move "every two days" to escape the glare.

The scandal prompted Hollande to order his ministers to disclose their personal wealth, a first in France, where personal finances are rarely discussed and the wealth of public officials had long been considered a private matter.

Prosecutors described the tax fraud as "determined" and "sophisticated" as well as a "family affair" including Cazuhac's now ex-wife Patricia Menard, a dermatologist who is a co-defendant in the case.

Also in the dock are their advisers, Swiss banker Francois Reyl and Dubai-based lawyer Philippe Houman, as well as the Reyl bank in Geneva, which is accused of helping Cahuzac transfer funds to Singapore to avoid detection by French tax authorities.

The French press are expecting damning details of the elaborate fraud, allegedly carried out between 1992 and 2013.

The prosecution allege that in one episode, Cahuzac, using the codename "Birdie", received two cash payments of 10,000 euros each in the streets of Paris.

They also claim a "friend" first opened an account with UBS in 1992, then Cahuzac himself opened one in his own name in 1993. In 1998, all the funds were allegedly transferred to Reyl, totalling some 600,000 euros by 2009.

That was when Switzerland's hallowed tradition of banking secrecy began to fall apart, under pressure from European and US officials eager to crack down on tax evasion in the wake of the financial crisis.

Cahuzac stands accused of channelling the funds to Singapore, taking a labyrinthine route through a shell company registered in the Seychelles set up by Houman of Dubai.

Menard is alleged to have deposited cheques from British clients in a secret account with an Isle of Man bank, which press reports said held some 2.5 million euros. She then opened her own separate account in Switzerland, reportedly containing one million euros, as her marriage with Cahuzac began falling apart.

Read more of this report from FRANCE 24.

See also:

The evidence behind the trial of French finance minister Jérôme Cahuzac

The Cahuzac affair: an A-Z of Mediapart's exclusive investigations and analysis

Wife of disgraced French budget minister investigated for tax fraud


 

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