Fifteen years ago, the tax authorities discovered a financial deal of staggering sums. Its organizers will be judged in Paris.
They are suspected of knowingly participating in a financial arrangement aimed at deceiving the tax authorities with huge sums: the former leaders of the investment firm Wendel, including the former president of Medef, are on trial from Monday in Paris. Fifteen years after the events, fourteen people must appear for three weeks, first of all, Baron Celier, 84 years old, heir to the Wendell family, at that time Chairman of the Supervisory Board and Patron of European Presidents.
At his side, Jean-Bernard Lafonta, 60, then at the helm of the Executive Board, as well as eleven CEOs – former and current – and a former tax attorney will have to explain their position at the head of the 32nd Correctional Chamber. A very sophisticated profit sharing scheme program called Solfur. At the end of May 2007, this clever scheme enabled fourteen officials (one of whom has since died) to recover 315 million euros in shares, or 4.6% of Wendell’s capital, and this, according to the prosecution, “Completely tax free».
For the National Financial Prosecutor’s Office (PNF), the gain then generated artificially, by corporate intervention, was placed under a system of “Tax suspension“With a view to deferring or even eventually avoiding the payment of taxes on these large capital gains. An explanation opposed by the defendants, who during the investigations refuted any intent to defraud, and to ensure that the assembly respected the law and administrative jurisprudence of the time. Their lawyers, who did not want to speak before trial, would demand, The trial is scheduled to begin on Monday with a procedural battle over the legal issues raised by the defense.
Simultaneously with a global reorganization, Operation Sulfur caused an uproar within Wendel, the former steel giant who became an investment company, still controlled by a family holding company with one thousand descendants of Jean Martin Wendel, founder of the group in Lorraine in 1704. In the months that followed. However, the difficulties faced by Saint-Gobain, in which Wendell invested, especially the 2008 financial crisis, stumbled the movement. Some executives considered themselves wronged, and took legal action, denouncing the eventual disastrous gathering. In December 2010, just days before the tax law, everyone was notified of a major amendment: 240 million in total, fines included. In 2012, Percy brought to justice a series of criminal complaints for tax evasion, which led to a judicial investigation.
The investigations relied notably on the exchange of emails regarding preparations for the arrangement at the end of 2006 and the beginning of 2007, between Wendel managers, their teams of lawyers and JPMorgan Chase, where “tax risksIt has been thoroughly studied. However, the US bank, which was initially put on trial in 2016 for complicity in tax evasion on the side of the defendants, will miss the court. In September, it agreed to pay a fine of €25 million via a court settlement to close the charges.
One “Mozart Finance»
Presented as aMozart FinanceWhen he arrived as group general manager in 2001 at the age of 40, Jean-Bernard Lafonta, who had worked for Lazard Bank and BNB, finally resigned in 2009 in the wake of the affair. Sentenced for insider trading and dissemination of misinformation and then released on appeal, he must be tried from Monday on charges of tax evasion but also of complicity: principal beneficiary (€120m, before Mr. Celier, 79m), suspect after inciting executives to join to Sulfur.
During the investigations, many of them confirmed that “He had no other choice“who accept”Package“,”key in hand“After confirming”Full compliance with legality and taxesWhile some have long opposed the tax amendment, nearly all CEOs have finally agreed to a deal with the tax authorities. A former tax attorney who was a member of the famous Debevoise & Plimpton, who helped shape the fine lines of the arrangement, is also on trial for complicity in tax evasion. All bear a fine of €37,500 and five years in prison.
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