International Journal on Criminology Volume 2, Number 1, Spring 2014 | Page 11

The Long Arm of Crime and Financial Crisis
had alerted the police, incriminating Samy
Souied as the probable person behind the
threats.
Five months later, Samy Souied
himself was shot down by two men in front
of the Palais des Congrès at Porte Maillot
in Paris. He had just landed from Tel Aviv
and was due to leave again that same evening.
He was carrying €300,000 in cash. The
last man who had spoken to him was the
former son-in-law of Claude Dray, a hugely-wealthy
businessman and art collector,
murdered at his mansion house in Neuilly-sur-Seine
on the night of October 24/25,
2011.
There was nothing that seemingly
connected this murder with the previous
ones. However, his assassination does raise
questions: his safe was full of jewels and
other valuables but nothing was stolen.
The real gangland bosses are concealed
behind these "white collar" swindlers
and fraudsters. These men do not forgive
errors or oversights. Similarly, the "loveable
rogues" of old were not inclined to forgive,
and the amounts of money at stake explain
this epidemic of old-fashioned 7.65 mm
weapon murders.
At the beginning of February 2012,
the French Court of Auditors covered this
affair in its annual report. It stated "the carbon
emission quota VAT fraud is the largest
tax fraud ever recorded in France in so short
a time. It demonstrates failings in regulating
a market in which naivety about how
resourceful fraudsters can be combines with
risk perception errors on the part of market
administrators and government. It also highlights
the inadequacy in forward planning
to provide effective regulation tools for markets
in which, given their characteristics, the
fraud potential has been overlooked."
The Court of Auditors assessed the tax loss
to the French autumn 2008 to June 2009
budget at €1.6 billion. Europol estimated
the total loss within the European Union at
€5 billion. Twenty or so prosecutions have
now been brought involving more than a
hundred individuals.
"Neither the European Commission
nor Member States have shown any concern
for safeguarding the conditions in which the
VAT is collected", stated the Court, which
underscored "the original flaws and loopholes
in the system: almost unrestricted access
by any natural person or corporate entity
to national quota registers and the lack of external
regulation." It also criticized the "inadequate
vigilance on the part of the market
administrator, too superficial an applicant
identity checking process, unconvincing application
of duties of vigilance, market operators
perceived the systemic magnitude of the
fraud too late, errors and mismanagement
on the part of finance ministries." On the
subject of TRACFIN, the French financial
intelligence unit, the Court of Auditors noted
"data processing delays incompatible with
swift action to stop fraud". It also criticized
the General Directorate for Public Finance
for failing to "anticipate" the magnitude of
the fraud, stressing that "its standard procedures
were not fit for purpose" and "there
was inadequate coordination between its different
services."
Despite acknowledging the May
2009 decision by the Finance Ministry to
alter the VAT collection method on CO2
quota transactions to stem Treasury losses,
the Court of Auditors reiterated the point
that there were still "persistent problems,
especially of poor" or inadequate control of
access to registers.
In short, as usual, the commission
of enquiry only exposed what had been
known for a long time (the first frauds of
this type date back to the 1970s): slow-moving
and cumbersome regulatory authority
action; existing systems incapable of taking
the criminal dimension into account.
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