PARIS - Monaco is a rogue state which connives in the laundering of drug and mafia money claims a French parliamentary investigation.
Although the accusation is not new, the severity of the language and the official nature of the inquiry makes its findings deeply embarrassing for authorities in both Monaco and
France.
The report accuses the tiny principality, surrounded by France and the sea, of having no proper system of "banking ethics," of allowing its celebrated casino to run "out of control" and refusing all serious cooperation with international efforts to control suspect flows of capital.
Monaco is therefore, de facto, a country "conducive to and complicit in" money laundering, the report says.
The committee of inquiry suggests that France, which provides almost all senior officials in Monaco, including the chief minister, is partly responsible for allowing this situation to arise and survive. It calls on the French Government to scrap all fiscal and judicial arrangements negotiated with the principality in 1963.
The committee lists three main complaints.
The secretive and "uncontrolled" banking system in Monaco - with 300,000 accounts for 30,000 people - refuses all useful cooperation with international investigations into money-laundering.
The principality's lax company law that allows a proliferation of off-shore companies, whose activities are beyond legal control or investigation. Monaco has 6,000 registered companies.
Large sums of money pass in and out of the companies, without the judicial authorities in Monaco having any right to seek information on their activities.
Finally, the state-owned Casino, whose directors include the head of state, Prince Rainier, is "out of control" and functions "without respect for [international] norms." The suggestion is that the casino may also be complicit in - or not sufficiently determined to exclude - money laundering operations.
Attempts by French-appointed investigating magistrates in Monaco to explore the murky banking activities in the principality have often been impeded by the authorities. On one occasion, Prince Rainier is alleged to have intervened personally to block an inquiry. Monaco officials argue that they have a duty to respect promises given to foreign investors that much of the business conducted in the tiny state is confidential.
A French banker, who had investigated financial flows and accounts in Monaco, spoke to the committee anonymously.
He said many bank accounts in Monaco were held by Italians but there was also a sprinkling of accounts in the name of "ministers, police chiefs and businessmen" from Francophone countries, including France itself.
The report, drawn up the Socialist deputy and lawyer, Arnaud de Montebourg, was accepted unanimously by left-of-centre members of parliament but rejected by the neo-Gaullist RPR, the party founded by President Jacques Chirac. The RPR said the report would "poison diplomatic relations" between Monaco and France.
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PARIS - Monaco is a rogue state which connives in the laundering of drug and mafia money claims a French parliamentary investigation.
Although the accusation is not new, the severity of the language and the official nature of the inquiry makes its findings deeply embarrassing for authorities in both Monaco and
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