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Court Convicts 3 Ex-French Oil Executives

November 12, 2003

PARIS (AP) _ A French court convicted three former executives Wednesday of helping loot $350 million from the Elf oil company to finance lavish lifestyles, closing a chapter in a scandal that sullied the nation’s political and business elite.

Former Elf chairman Loik Le Floch-Prigent, 60, and senior director Alfred Sirven, 76, were given five-year prison terms for masterminding the mass embezzlement in the late 1980s and early 1990s, when Elf was under state ownership.

Sirven, the company’s former No. 2 official, was ordered to pay $1.16 million, while Le Floch-Prigent must pay $435,000.

Andre Tarallo, former head of Elf’s hydrocarbons division, was sentenced to four years and fined $2.3 million.

Twenty-seven accomplices, among them other former Elf officials, also were convicted Wednesday. The company since has been absorbed into the Franco-Belgian energy group Total.

Wednesday’s verdicts culminated almost a decade of legal action that shook the French establishment and tarnished its image globally.

Early in the case, Le Floch-Prigent and Sirven threatened to expose links between their misdeeds and French political leaders, but the two refused to name names in court and none of those alleged connections were established.

The three main defendants claimed much of the cash was paid out as ``commissions″ to foreign officials _ especially in African countries where Elf was prospecting _ and French political parties.

However, the court said personal gain was the primary motive behind the embezzlement.

``Every time these directors signed a contract, gave an agreement or took a decision ... the evidence has shown that they benefited from kickbacks from funds diverted to hidden accounts,″ presiding judge Michel Desplan said in a statement.

The judge earlier told the court that $199 million in stolen Elf funds were paid into secret accounts managed by Sirven.

``That’s about the same figure as Elf’s total net earnings for 1993,″ he added.

The court saved its sternest words for Le Floch-Prigent, saying he was ``personally behind most of the misdeeds committed against the French oil company″ during his 1989-1993 tenure.

Le Floch-Prigent used company cash to buy luxury properties in Paris and Normandy and fund a $5.3 million divorce settlement with ex-wife Fatima Belaid.

She was sentenced to three years in jail _ of which two were suspended _ and fined $1.2 million.

Le Floch-Prigent’s lawyer, Maurice Lantourne, said his client accepted the court’s decision.

``He said he wouldn’t appeal, and he won’t appeal,″ Lantourne said. ``He wants to turn the page. It’s a relief, paradoxically.″

Lead prosecutor Catherine Pignon sought a five-year jail term for Le Floch-Prigent and eight-year terms for Sirven and Tarallo.

Sirven and Le Floch-Prigent already are serving time after losing appeals against separate convictions two years ago over the use of Elf money to ``lobby″ then-Foreign Minister Roland Dumas. They put Dumas’ mistress on the payroll and funded her lavish perks.

The case effectively ended Dumas’ career, despite his acquittal on appeal earlier this year.

The court said former director Alain Guillon and three other company officials also opened offshore bank accounts to siphon off Elf cash.

Guillon was jailed for three years and ordered to pay $2.3 million, while the others received suspended jail terms and lesser fines.

Andre Guelfi, who negotiated Elf contracts in ex-Soviet states, received a three-year suspended term and a $1.2 million fine on several counts of embezzlement, but was cleared of any wrongdoing over his contracts with former Elf subsidiary SNEA.

Guelfi now planned to sue the company for his unpaid dues, his lawyer, Pierre-Olivier Sur, said after the ruling.

In all, 14 former Elf officials and associates were jailed Wednesday, and another 16 were given suspended sentences. Seven were acquitted.

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