French minister in hot seat over embezzlement allegations

French minister Marlène Schiappa gave testimony on June 14 in a Senate inquiry over allegations that a fund to fight religious extremism she managed funneled public money to people close to her. 

As France’s minister for associations, Schiappa, set up the Marianne Fund in response to the 2020 murder of Samuel Paty – a teacher who was beheaded outside his school in the Paris suburbs by a Muslim extremist who was angry Paty had showed cartoons of the Prophet Mohammed in a class about free speech.

The fund was initially given a pot of public money worth €2.5 million to support associations aiming to counter Islamist extremism online, France24 reports.

But allegations of embezzlement have cast a shadow over Schiappa – a high-profile figure in President Emmanuel Macron's government – and triggered a Senate probe and an investigation by financial prosecutors.

During more than three hours of questioning before the Senate on June 14, the minister said she would take “responsibility” for her part in the scandal, even as she denied any wrongdoing and sought to shift the blame onto her administration.

Accusations of embezzlement

Schiappa, then deputy minister for civic rights, set up the Marianne Fund in April 2021, six months after Paty was murdered aiming to create a “counter narrative” to online extremism.

Two years later, with Schiappa now a cabinet minister, multiple French media outlets began to raise questions over how payouts from the fund were being awarded and used.

Investigations by news magazine Marianne and France 2 television found that the biggest payout had gone to one organisation, the Union des sociétés d'éducation physique et de préparation militaire (USEPPM), which received €355,000. The money went towards a single website and a collection of anti-extremist videos, social media posts and articles that found almost no audience online.

In addition, €120,000 was used to pay two of the organisation's ex-directors.
The Mediapart investigative website revealed in May that the fund had paid out just over €2 million to 17 different associations.

Among these, one organisation (called Reconstruire le commun, which received a €330,000 payout) went on to publish videos attacking opponents of President Emmanuel Macron during the 2022 elections.

Schiappa’s former office director, Sébastien Jallet, revealed on June 7 that the minister had intervened to exclude the organisation SOS Racisme, which had been approved by the selection committee and had requested €100,000 in funding.

Schiappa has rejected accusations from opposition politicians that she directed the funds towards people with whom she had personal relationships. “I deny what has been said, notably by certain LFI [La France Insoumise] MPs, who said that I had given money to my friends, and that there was cronyism or favouritism.”

Legal, administrative and Senate inquiries

Schiappa was defended by Prime Minister Elisabeth Borne in a June 11 interview.

"She is very committed ... someone with a lot of personality who wants to contribute," Borne told France 3 television, denying that Schiappa might be replaced in a widely anticipated government reshuffle.

As well as the Senate inquiry, a series of separate investigations have aimed to uncover if Schiappa intervened in the selection process for beneficiaries of the fund.

Two legal cases have been brought by Paris Mayor Anne Hidalgo, who is a member of the Socialist Party, and Mathilde Panot, head of ministers for the left-wing France Unbowed (La France Insoumise) party.

The National Financial Prosecutor’s Office has opened an investigation into whether public funds were embezzled or if there is evidence of financial negligence, breach of trust or unlawful pursuit of business interests by a public official.

The current minister for civic rights, Sonia Backès, has brought a case with the interior ministry’s inspection agency (l'inspection générale de l'administration, or IGA), with investigations set to conclude at the end of June.

"Failings, irregularities"

An initial report from the IGA, published on June 6, found no wrongdoing on Schiappa’s part. According to those questioned, it said, “the deputy minister was removed from the process as soon as [the fund] was officially launched”.

Instead, it criticised the role of an interior ministry committee that supervised the Marianne Fund (La Comité interministériel de prévention de la délinquance et de la radicalisation), highlighting numerous "failings" and "irregularities" by the association in both the tender process and the use of the funds.

The head of the committee, Christian Gravel, stepped down after the report accused him of showing “favouritism” towards USEPPM.

French investigators on Tuesday conducted raids on the homes of Gavel and ex-journalist Mohamed Sifaoui, one of the two co-chiefs of the organisation, who "doubled their salaries" after winning the grant, according to the report.

Multiple witnesses called by the Senate inquiry have indicated that Sifaoui visited the interior ministry office multiple times before the fund was launched.

"False accusations"

It remains to be seen whether Schiappa will emerge from the scandal unscathed. France Unbowed MP Aurélien Saintoul called for the minister to resign at a parliamentary meeting on Tuesday, which Schiappa did not attend.
During the Senate inquiry, one court reporter was heard to describe her claims as “extraordinary”.

“At no point up to now have you questioned or discussed your own responsibility,” Senate President Claude Raynal told Schiappa during the hearing. “You say it’s your administration[’s fault]; No, madame. When the administration takes a position, it's supposed to be the minister's position.”

Schiappa has characterised the accusations against her as “slander”. In a Tweet on April 27 she said that her lawyer “would pursue defamation cases against all those making false accusations of favouritism”.