Sarkozy hit by more arms deal leaks
the Elysee Palace was said yesterday to be in a "state of panic" after an extraordinary day of leaks and counter-leaks on a deepening financial scandal involving two long-time friends and colleagues of President Nicolas Sarkozy's.
Another of Mr Sarkozy's friends, Brice Hortefeux, found himself dragged yesterday into the "Karachi affair": allegations that millions of dollars in kickbacks on arms contracts were paid to the failed presidential campaign of the then prime minister, Edouard Balladur, in 1994-5.
The newspaper 'Le Monde' published the transcript of a telephone call, recorded by police 10 days ago, in which Mr Hortefeux spoke to his friend Thierry Gaubert, one of two Sarkozy associates arrested this week and accused formally of "receiving embezzled funds". In the conversation, Mr Hortefeux gave a warning to his friend, apparently based on inside knowledge of an independent judicial inquiry, that Mr Gaubert's estranged wife, Helene, was "blabbing" to investigators. She had spoken to police on September 8, six days earlier and is reported to have said that she travelled to Switzerland in 1995 with her husband to pick up briefcases full of cash for Edouard Balladur's campaign.
At the time of Mr Hortefeux's bugged phone call this month, this transcript had not reached the magistrate in charge of the inquiry. The president of the largest French magistrates' union, said yesterday that the Elysee had "clearly" violated what was supposed to be a "secret" investigation. The fact that the Elysee had admitted this "suggest, objectively, that there is panic aboard the ship," he said.