Credit Lyonnais Probe Adds Trichet
PARIS (AP) _ The head of the Bank of France is being investigated in connection with the travails of Credit Lyonnais, a bank that lost billions before undergoing a costly government bailout.
Jean-Claude Trichet, who has been expected to succeed Wim Duisenberg as head of the European Central Bank in 2002, is suspected of disseminating false information to financial markets, judicial sources said on condition of anonymity.
Trichet served as director of the French Treasury from 1987 to 1993, covering the critical 1992-93 period of bank records being examined. Trichet was appointed governor of France’s central bank in 1993.
In a brief statement, Trichet said he was ``profoundly surprised″ by the turn of events and that he would place himself at the ``total disposition″ of the investigating judge. ``I have total confidence in the justice of our country,″ he said.
Judge Jean-Pierre Zanoto was expected to summon Trichet for questioning. Zanoto is in charge of the investigation, which opened in December 1996.
Jean-Yves Haberer, Credit Lyonnais’ chairman from 1988 to 1993, was placed under investigation two years ago for presenting false financial records and information. Francois Gille, the bank’s director-general, is under investigation for presenting false company accounts.
The bank lent money to several companies that went under, racking up billions of francs in debt and forcing a costly government bailout, approved last year, that cost French taxpayers nearly $18 billion.
Credit Lyonnais’ reputation was so tarnished that the European Union Commission agreed to aid only on condition that the bank sell off a series of its assets.
In his statement, Trichet defended his actions while director of the Treasury, saying it was the Treasury’s careful investigation that led to the restructuring of the then-state-owned bank.
``More than seven years ago, (the Treasury) did all within the limits of its responsibility to ensure that the bank changed course,″ the statement said.
The bank, privatized last year, is now profitable.