Partial unemployment fraud in France and cryptocurrencies: crackdown in Israel – 08/16/2022 at 11:09

The investigation concerns a sprawling file of massive partial unemployment fraud during the Covid-19 pandemic in France.


(illustration) ( AFP / JOEL SAGET )

Several people suspected of being involved in short-time work fraud in France, valued at tens of millions of shekels (several million euros), and money laundering using cryptocurrency were arrested on Monday in Israel, local police and a source familiar with the matter said.

As part of an investigation carried out in cooperation with the French gendarmerie and Europol, the Israeli police arrested “three main suspects” and “a number of others”, detained for questioning.

The investigation, which relates to suspicions of “laundering tens of millions of shekels using complex mechanisms” of cryptocurrency, focuses on a “large-scale fraud targeting the French Treasury” carried out from Israel, according to the police, who did not detail the identity of the suspects.

54 million euros embezzled

A source close to the case told AFP that it was a massive fraud in partial unemployment during the Covid-19 pandemic in France, a complex file with multiple ramifications instructed in Paris at the National Court in charge of the fight against organized crime (Junalco).

In November 2020, the Paris prosecutor’s office estimated the short-time working fraud at 182 million euros, of which only 54 million had actually been misappropriated, the rest having been blocked before payment. Several investigations have been opened.

In one of them, entrusted since 2020 to the gendarmes of the Toulouse research section and the Central Office against illegal work (OCLTI), made it possible to draw the modus operandi of the crooks.

The latter took advantage of the fact that the French government extended, from the confinement and to compensate for the resulting cessation of activity, the possibility of resorting to partial unemployment and compensating employees.

Fraudsters usurped the corporate name and identification number of existing businesses to claim compensation.

Since June 2021, a man living in the Paris region has been indicted on suspicion of belonging to a criminal organization based in Israel at the origin of more than 7,000 false requests for partial unemployment compensation for a total damage to the State around 11 million euros.

“Very active” cooperation between France and Israel

The investigators had uncovered “accounts opened in France and rebound accounts opened afterwards which allow the money to pass quickly” to reintegrate it into the legal economy. The 31-year-old French suspect “denies being the leader of this scam”, his lawyer, Me Philippe Ohayon, told AFP.

In a statement, the Israeli police reported a “methodical” device to launder money, part of which came “from crimes committed abroad”, “using digital currencies on several platforms with the purpose of hiding the identity of the owners of the money”. “This is not the only Franco-Israeli affair and cooperation between the two countries is very active”, remarked Me Ohayon.

Israel could choose to try the suspects on the spot or France could request their extradition, which will only be effective in a year or two, according to Me Ohayon.

This delay “poses problems in terms of the judicial agenda and the rights of people”, he estimated, recalling that his client had been in pre-trial detention for a year. In recent years, several Franco-Israelis have been arrested by the Israeli authorities in cases of fraud.

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