/ 9 January 2005

French stars in the limelight over links to fallen tycoon

In a rare meeting of artistic licence and creative accountancy, France’s most successful actor, Gérard Depardieu, is this week due to be questioned by fraud investigators about his links with a disgraced tycoon said to be hiding in Britain after his empire collapsed, leaving 14 000 people jobless.

Depardieu (56) will follow actress Catherine Deneuve into the office of the judge who is unravelling the rise and fall of Algerian millionaire Abdelmoumen Rafik Khalifa. In the space of less than ten years, Khalifa (38) created a pharmaceuticals empire, bought some of Europe’s most expensive property, started a bank, an airline and a luxury car rental service, and put his name on Olympique de Marseille’s strip.

He mingled with the rich and famous, including Sting, Ricky Martin, Bono, Pamela Anderson, Melanie Griffith and former French Culture Minister Jack Lang.

But it remains unclear where his money came from — or where it went. ”This case makes companies such as Enron and WorldCom look transparent,” said Marie-Christine Béguin, a lawyer for the Khalifa group’s former employees. ”The group was managed in a totally irrational way, with the tacit assent of the French and Algerian authorities. It collapsed like a house of cards.”

Last Wednesday, in judge Isabelle Prévost-Desprez’s office, 61-year-old Deneuve was asked whether she had received an appearance fee from Khalifa’s empire of â,¬40 000, handed over in cash in a toilet.

The exchange is alleged to have taken place around a marble handbasin in a luxury compound above Cannes, where Khalifa launched his TV station on 3 September, 2003. The party was a star-studded bash attended by Deneuve and Depardieu.

Deneuve’s agent refuses to answer questions about the star’s alleged links to Khalifa, which could lead to her being prosecuted for tax evasion. Deneuve has also been accused by Khalifa’s former right-hand man, Mohamed Chechaoui, of receiving â,¬45 000 to attend a football match in Algiers.

Depardieu, who until recently described himself as a friend of Khalifa and called him ”the saviour of Algeria”, has denied receiving cash. Investigators are looking at allegations he used a Khalifa jet for trips to Marseille and New York.

Judge Prévost-Desprez is investigating a range of allegations against Khalifa, including embezzlement of company funds, fraudulent bankcruptcy and money laundering. She has placed five people in France under formal investigation — a step short of charging them — but has not yet questioned Khalifa or requested his extradition from Britain.

The millionaire is also under investigation in Algeria, where small investors in Khalifa Bank have lost millions.

Algerian journalists critical of the country’s government have claimed the businessman, a former minister’s son, is a glamour-dazzled money launderer.

There are allegations that Khalifa is linked to the military that control Algeria and its oil wealth. They cite copious examples of Khalifa engaging in what on the surface could be seen as very similar to money-laundering practices — buying assets at inflated prices, such as the Cannes compound or his fleet of luxury rental cars, and reselling them for much less.

But French journalists who investigated the Khalifa story say that many Algerian military chiefs have been quietly laundering the country’s oil wealth for 40 years and they do not need a high-profile golden boy who makes the process public.

Rather, they suggest, from the time in 1990 when the government gave Khalifa the country’s first licence to trade in generic medicines, he was encouraged to become an emblem of Algerian capitalism — and is in fact a hero to a generation of jobless youths. – Guardian Unlimited Â