Analysis
14 July 2021

The PNF looks back on a very unusual 2020 year

Bastille Day Newsletter 2021 - Legislative, Regulatory & Policy Updates

 

The French Financial Prosecutor Office (“PNF”) was created in 2013 in the aftermath of a scandal where a former Budget Minister was accused of holding unreported bank accounts in offshore jurisdictions[i]. Operational since February 1st, 2014, the PNF has national jurisdiction to prosecute and investigate on infringements to probity, tax, and the proper functioning of financial markets such as corruption, money laundering, tax fraud or market manipulation[ii]. The PNF was recently granted concurrent jurisdiction on anti-competition offences[iii].

In a criminal procedure circular of June 2020, the French Ministry of Justice consolidated the role of the PNF in the fight against corruption[iv]. The PNF is invited to consider any alert from authorities, whistleblowers, regulated professions, authorized NGOs or media investigations[v]. The circular also encourages the PNF to prosecute acts of corruption committed by companies carrying out part of their activity in France, even if they do not have their head office there[vi].

With 601 pending proceedings, 123 new investigations, respectively 27 and 64 requests for mutual assistance issued and received in 2020, the PNF had a busy year[vii]. 38 % of its cases originated from information transmitted by public authorities and 24% from complaints filed directly with the PNF. 53 % of cases are related to probity breach, 40 % to tax offenses and 7% to financial markets rules violation. The total of the fines imposed by the PNF amounted to €2.1 billion and the total amount of confiscations reached €121.9 million[viii].

2020 was also marked by significant cases including the Airbus CJIP led by the PNF in collaboration with the UK Serious Fraud Office and the US Department of Justice[ix]. Another important case was that of Rifaat Al-Assad, the uncle of the current Syrian head of state, who was convicted and had his assets in France confiscated[x]. Some cases brought strong media coverage such as the conviction of former French Prime Minister François Fillon and his wife for misappropriation of public funds[xi], and the conviction of Former French President Nicolas Sarkozy’s for corruption and influence peddling[xii].

Statements by the former PNF Head Eliane Houlette has revived the debate on the independence of the French Prosecutor vis-à-visthe executive power. She declared that the independence of French prosecutors, in particular of the PNF, is hampered by a number of obstacles[xiii]. Moreover, in the case of Nicolas Sarkozy, the PNF carried out investigations on several lawyers’ telephone records, known as fadettes. Eric Dupont-Moretti, a former defense attorney whose fadettes were investigated by the PNF in the context of this case and who has since become Minister of Justice, filed a complaint for breach of professional secrecy which he has later retracted[xiv].

The fadettes scandal led to an investigation into the functioning of the PNF by the General Inspection of Justice and the report of such investigation was published in September 2020[xv]. It noted that the access by investigators to a lawyer’s phone records during a preliminary investigation does not, per se, violate his or her professional secrecy[xvi]. This analysis is in line with prevailing case law which had, in the last few years, jeopardized the absolute nature of the Attorney’s professional secrecy[xvii]. Indeed, it is possible for a client’s conversation with his Attorney to be taped, reviewed and transcribed during a criminal investigation, if it appears during such conversation that the attorney may have participated in the offence[xviii].

Yet, the Report pinpoints ‘a lack of rigour’ in the handling of the PNF’s work and underlines the fact that the preliminary investigation, in the Nicolas Sarkozy case, had lasted for more than five years[xix], which must be put into perspective with the fact that during that time, the defense had virtually no access to the case file[xx]. Indeed, during a preliminary investigation, the suspect may only request access to the case file after a year from the beginning of such investigation, and the request is subject to the discretionary decision of the prosecutor.[xxi] The Report also underlines that during the preliminary investigation, the parties cannot challenge the investigative acts decided by the prosecutor[xxii].

In response to these remarks, the PNF has decided to systemically grant access to the case file to persons under investigation when the prosecutor is considering referring them to criminal court[xxiii].

Besides these few observations on the preliminary investigation procedure, the report made 19 recommendations to improve the functioning and organization of the PNF[xxiv].

Between the Covid 19 pandemic, the high-profile cases and the controversies on defense rights, 2020 was definitely a busy year for the PNF.

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