'Bribes and bombs' scandal returns to haunt Sarkozy - Europe - World - The Independent

'Bribes and bombs' scandal returns to haunt Sarkozy

Families of 11 engineers murdered in Karachi in 2002 point finger of blame at French government

A political scandal is gathering pace over claims that 11 French submarine engineers were murdered in a bomb attack in Karachi seven years ago to punish France for the non-payment of arms contract "commissions" to senior Pakistani officials.

Lawyers for the French victims' families believe the attack, allegedly carried out by Islamist terrorists, was in fact part of a web of financial chicanery and political manoeuvring which may yet severely embarrass senior figures, including the French President Nicolas Sarkozy and his Pakistani counterpart Asif Ali Zardari.

Two French magistrates investigating the bombing of the engineers' bus in May 2002 have ruled out the possibility that it was an attack by al-Qa'ida on Western interests. They have told the victims' families there is "cruel logic" to an alternative explanation. They believe unknown figures in the Pakistani establishment may have fomented the attack in retaliation for the non-payment of part of the €80m (£68m) in sweeteners promised to senior officials when Lahore bought three Agosta 90B submarines from France in 1994.

Documents seized by French police allege that part of these "commissions" – legal under French law at the time – were illegally "kicked back" to help finance the 1995 presidential campaign of the then prime minister, Edouard Balladur. When Jacques Chirac won the election the following spring, it is alleged that he punished his old friend and acolyte for running against him by cancelling the remaining payments to senior Pakistani figures.

M. Chirac's then defence minister, Charles Millon, confirmed in an interview with Paris Match magazine yesterday that, soon after he took office in 1995, he was ordered to block the Pakistani commissions and all other arms payments on which "retro-commissions", or kick-backs to France, were suspected. When the €800m submarine sale was negotiated, M. Sarkozy was the budget minister and M. Balladur's right-hand man. He was also a key figure in the then prime minister's decision to break with M. Chirac that autumn and run for the presidency the following spring. There is no direct evidence linking him with either the legal commissions or the alleged illegal kick-backs but, as budget minister, he would have had to sign documents authorising large, untaxed payments to foreign officials.

According to investigation documents leaked to the Agence France Presse news agency, a large part of the €80m was paid out before M. Chirac intervened and had already been "distributed" by the then Pakistani investment minister, Asif Ali Zardari. Mr Zardari, husband of the late prime minister, Benazir Bhutto, is now President.

The legal implications of the affair are unclear but the political implications could be explosive. If clear evidence emerges to link the submarine commissions to the killing of the 11 French engineers and three Pakistanis, there would at the very least be deep embarrassment for M. Balladur, M. Chirac and for President Sarkozy.

When asked about the suspicions of the two French investigating judges, M. Sarkozy flew into a temper. He said any suggestion that the murders were a Pakistani retaliation for non-payment of French commissions was a "fable". "This is ridiculous. It is grotesque," he added. "Let's have some respect for the grief of the victims. Who could believe a fable like that?"

The answer is that the "fable" is being taken seriously by the victims' families, lawyers and the investigating judges, Marc Trévidic and Yves Jannier. "The al-Qa'ida line of inquiry has been totally abandoned," said Maître Olivier Morice, a lawyer for seven of the families, after meeting the judges in Cherbourg, where the engineers were based. "This is all linked to the payment of commissions... they were blocked by Jacques Chirac to prevent kick-backs to the presidential campaign of Edouard Balladur. This is turning into a [state scandal]."

On 8 May 2002 – just after M. Chirac won a second term as president – a bomb exploded in Karachi beside a bus transporting French shipyard workers who were assembling one of the Agosta submarines. Fourteen people were killed, including 11 French workers. Both Pakistani and French authorities blamed Islamists close to al-Qa'ida, but it appears that US intelligence agents told Paris at the time that the attack was linked to blocked payments on the submarine contract. A self-confessed militant, Asif Zaheer, was convicted in 2003 of playing a part but his conviction was quashed on appeal last month.

The investigating judges are said to believe that M. Chirac's re-election convinced figures in Pakistani they would never receive their missing money – hence the timing of the attack.

In a speech at a remembrance service for the dead shipyard workers in Cherbourg in June 2002, President Chirac said France would not surrender to "blackmail" – a word which caused some puzzlement at the time.

The key figures: 15 years ago and now

Edouard Balladur, 80

THEN Centre-right prime minister in cohabitation with the Socialist president, François Mitterrand. Ran for presidency in 1995 but was knocked out by Chirac in first round.

ROLE It is alleged in documents seized by French police that his campaign – quite possibly without his knowledge – benefited from illegal kickbacks.

NOW Retired.

Jacques Chirac, 76

THEN Mayor of Paris and leader of the centre-right RPR party. Ran for the presidency in 1995 for the third time and won.

ROLE As president, he ordered the cancellation of the Pakistani "commissions", allegedly in pique against M Balladur.

NOW Retired.

Charles Millon, 63

THEN Chirac's defence minister in 1995.

ROLE Admits he cancelled Pakistani commissions on Chirac's orders.

NOW Faded from mainstream politics.

Asif Ali Zardari, 53

THEN Minister in government of his wife, Benazir Bhutto, who was murdered in 2007 after she returned to Pakistan.

ROLE Alleged to have "distributed" part of the commissions paid by France, which were legal under French law.

NOW President of Pakistan.

News
Paper trail: the wedding photograph found in the rubble after 9/11 – it took Elizabeth Keefe 13 years to find the people in it
newsWho are the people in this photo? It took Elizabeth Stringer Keefe 13 years to find out
Arts and Entertainment
Evil eye: Douglas Adams in 'mad genius' pose
booksNew biography sheds light on comic genius of Douglas Adams
Sport
FootballFull debuts don't come much more stylish than those on show here
News
i100
PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
Kim Kardashian drawn backlash over her sexy swimsuit selfie, called 'disgusting' and 'nasty'
fashionCritics say magazine only pays attention to fashion trends among rich, white women
Arts and Entertainment
TVShows like Agents of S.H.I.E.L.D are little more than marketing tools
Arts and Entertainment
Hit the roof: hot-tub cinema east London
architectureFrom pools to football pitches, rooftop living is looking up
Travel
travel
News
The ecological reconstruction of Ikrandraco avatar is shown in this illustration courtesy of Chuang Zhao. Scientists on September 11, 2014 announced the discovery of fossils in China of a type of flying reptile called a pterosaur that lived 120 millions years ago and so closely resembled those creatures from the 2009 film, Avatar that they named it after them.
SCIENCE
Life and Style
tech
Arts and Entertainment
Matisse: The Cut-Outs exhibition attracted 562,000 visitors to the Tate Modern from April to September
art
Life and Style
Models walk the runway at the Tom Ford show during London Fashion Week Spring Summer 2015
fashionLondon Fashion Week 2014
News
Kenny G
news
News
peopleThe black actress has claimed police mistook her for a prostitute when she kissed her white husband
Life and Style
techIndian model comes with cricket scores baked in
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Energy Markets Analyst

£400000 Per Annum: The Green Recruitment Company: Job Title: Energy Markets An...

Junior Web Analyst – West Sussex – Up to £35k DOE

£30000 - £35000 Per Annum Plus excellent benefits: Clearwater People Solutions...

Nursery Manager

£22000 - £23000 per annum: Randstad Education Bristol: We are currently recrui...

Web Analyst – Permanent – Up to £40k - London

£35000 - £40000 Per Annum: Clearwater People Solutions Ltd: We are currently r...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week