London, Jan 3 (ANI): A two-decades-old financial scandal threatens to engulf the former French Prime Minister Edouard Balladur and can derail re-election campaign of his former lieutenant and present president, Nicolas Sarkozy.
New evidence emerged on Monday linking President Sarkozy to an off-shore company created in 1994 to handle commissions on large French arms sales to Pakistan and Saudi Arabia.
The accusations surrounding the Balladur campaign are especially explosive. After Jacques Chirac won the 1995 presidential election, he froze the Pakistani and Saudi commissions, allegedly to punish his old friend Balladur for running against him, The Independent reports.
It is alleged by two other magistrates that this led indirectly to a "terrorist" attack on a bus in Karachi in May 2002 in which 14 people, including 11 French submarine engineers, died.
The commissions, paid through a company in Luxembourg allegedly created by Sarkozy as budget minister, were not illegal at the time. It is suspected, however, that cash kick-backs were paid on the contracts - secret commissions on commissions - to fund Balladur's failed 1994-95 campaign for the presidency.
Payments of this kind were legal in France until 2000 but the magistrates suspect that part of the cash was illegally "kicked back" to the Balladur campaign.
Sarkozy was also the spokesman - and de facto manager - of Balladur's unsuccessful presidential bid. No direct evidence has emerged, however, linking him to kickbacks or other illegal campaign funding, The Independent reports. (ANI)
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