TAIPEI, Taiwan -- A report on the French corruption scandal stemming from the 1991 sale of six La Fayette class frigates to Taiwan reportedly concludes that the French government may have to pay as much as EUR475 million ($600 million) in fines to the government of Taiwan for overcharging on the sale of the ships. The report was drawn up by Paris prosecutor Yves Bot and was turned over the French Justice Ministry, but not before the report's findings were leaked to the press. According to the report, the French government is likely to be held liable in the case, which is being held before the international commercial tribunal. In that event France would be required to repay lobbying "commissions" that should have been deducted from the sale price of the warships.
The scandal stems from the 1991 sale of the six frigates to Taiwan by the French state-owned company Thompson-CSF. Thompson officials reportedly paid some $600million in commissions to middlemen who helped secure the contract for Thompson. The final sale price was some EUR2.44 billion, though later investigations have shown that at leat a third of the cost came in the form of a lobbying - and possible bribery efforts - on the part of Thompson. In order to recoup its efforts Thompson then simply passed along the cost to the Taiwanese government. Thompson-CSF has since been privatized and renamed Thales.
If the French government is held liable it will, in effect, have to pay the "commissions" twice, first to the middlemen and now to repay the government of Taiwan. It is yet another illustration of how graft and corruption cost taxpayers dearly.
The scandal stems from the 1991 sale of the six frigates to Taiwan by the French state-owned company Thompson-CSF. Thompson officials reportedly paid some $600million in commissions to middlemen who helped secure the contract for Thompson. The final sale price was some EUR2.44 billion, though later investigations have shown that at leat a third of the cost came in the form of a lobbying - and possible bribery efforts - on the part of Thompson. In order to recoup its efforts Thompson then simply passed along the cost to the Taiwanese government. Thompson-CSF has since been privatized and renamed Thales.
If the French government is held liable it will, in effect, have to pay the "commissions" twice, first to the middlemen and now to repay the government of Taiwan. It is yet another illustration of how graft and corruption cost taxpayers dearly.
