Clearstream
Encyclopedia
Clearstream Banking S.A. (CB) is the clearing
and settlement
division of Deutsche Börse
, based in Luxembourg
and Frankfurt
.
Clearstream was created in January 2000 through the merger of Cedel International
and Deutsche Börse Clearing. Its main functions are acting as International Central Securities Depository
(ICSD), Clearstream also acts as the Central Securities Depository (CSD) for Germany and Clearing House
for a number of securities
. It is one of the biggest custodians and clearer of the eurobond
s market.
Clearstream has been criticized for allowing banks to move money undetected and has been accused of involvements in a number of cases involving money laundering
and tax evasion
. Two notable cases have become known as the Clearstream Affair
which started with the release of the book Révélation$ in 2001 by the investigative reporter Denis Robert
and ex-Clearstream banker Ernest Backes and the Second Clearstream Affair which started in 2004 when anonymous denunciations was sent to magistrate Renaud Van Ruymbeke
accusing a number of major French political figures of having received kickbacks.
, which was then owned by US bank J.P. Morgan & Co.
, being a monopoly in this area.
Clearstream's customers are banks or financial institutions who have accounts with Clearstream which are used to settled and delivered eurobonds with their counterparts. No individual can open an account with Clearstream.
In 1996, Clearstream obtained its own banking license.
In January 2000 it became Clearstream through the merger of Cedel International and Deutsche Börse Clearing, a subsidiary of Deutsche Börse Group, which owns the Frankfurt Stock Exchange
when it took a 50% shareholding.
In July 2002, Deutsche Boerse bought the remaining 50% of Clearstream International for 1.6 billion euros.
In 2009 Clearstream contributed earnings before interest and taxes
of €720 million to Deutsche Börse. It handled 102 million transactions, and was custodian of securities worth €10.3 trillion.
So a bank can just order a transaction between its own account and the other bank's account, in lieu of less secure methods such as carrying a case full of currency or securities around on the street; the bank merely transmits an order to Clearstream to credit/debit one of its own accounts and the other bank's account(s). This general system is in use between regular companies, governments, and banks around the world.
The purpose of International central securities depositories like Euroclear and Clearstream is to facilitate money movements
around the world, particularly by handling the resolution of sales of European stocks
and bonds
, in which market Clearstream is a major player, with an estimated 40% market share
until May 2008 - together with its competitor Euroclear
, the two firms settle 70% of European transactions. Furthermore, in January 2009, Clearstream was the 11th largest employer in Luxembourg.
Clearstream does not hold a monopoly in this market: Euroclear, owned by the market, and custodian banks (Bank of New York-Mellon..] are competitors. ; Clearstream's quasi-monopoly
is demonstrated by this European Union
statement declaring that "Clearstream Banking AG is an unavoidable trader partner."
Euroclear was created by JP Morgan in 1968 in Brussels
(Belgium). By the end of 2000, JP Morgan had extricated itself from Euroclear, but JP Morgan still is one of the 120 international banks which own shares in Euroclear. In 2000, Euroclear processed 145 million transactions, dealing with a total of 100,000 billion euros.
. By the 1990s, the U.S. Federal Reserve estimated that about 2/3 of U.S. currency was held abroad as eurodollars.
found that "Clearstream Banking AG and its parent company
Clearstream International SA ("Clearstream") infringed competition rules by refusing to supply cross-border securities clearing and settlement services, and by applying discriminatory prices. Clearstream has appealed in front of the European Court of Justice. The case was pleaded in July 2008 and the decision is pending.
The Commission’s investigation revealed that Clearstream refused to supply Euroclear Bank SA ('Euroclear Bank') with certain clearing and settlement services, and applied discriminatory prices to the detriment of this customer."
The decision states that "Clearstream refused to supply to Euroclear Bank clearing and settlement services for registered shares issued under German law
," underlining the "dominant position" of Clearstream since it "is the only final custodian of German securities kept in collective safe custody, which is the only significant form of custody today for securities traded. New entry into this activity is unrealistic for the foreseeable future. Therefore, Clearstream is an unavoidable trading partner."
The Commission defined clearing
and settlement
as follows:
"The Commission considered that during the reference period concerned, 1997 through 2001, Clearstream held a dominant position for providing cross-border clearing and settlement services to intermediaries situated in other member states. The investigation therefore focused on a specific cross-border market and the decision does not set out findings that go beyond that relevant market."
The Commission underlined in a note that, "Central Securities Depositories hold securities and enable securities transactions to be processed through book entry
. In its home country, the Central Securities Depository provides processing services for trades of those securities that it holds in final custody. It can also offer processing services as an intermediary in cross-border clearing and settlement, where the primary deposit of securities is in another country."
and Ernest Backes, an executive at Cedel until May 1983, published a book, Revelation$ in which they alleged that Clearstream played a major part in the underground economy
, was a main platform for money laundering
for hundreds of banks, and "operated hundreds of confidential accounts for banks so they could move money undetected," according to Business Week.
Backes and Le Figaro
were sued by Clearstream and found guilty of libel on March 29, 2004. Denis Robert was sued for libel and found guilty three on three counts on appeal on 16 October 2008 for the books Revelation$ and Black Box, as well as the documentary "Les Dissimulateurs" (The Deceivers). However, in February 2011, in a final judgment, the Court of Cassation
overturned all convictions, ruling that his work was protected by freedom of speech and of the press.
After an investigation in Luxembourg
, which was closed in November 2004 after no evidence had been found of wrongdoing (Luxembourg prosecutor's office, Nov. 30, 2004), on suspicion of money laundering, tax evasion, and other fraud, Clearstream's CEO, André Lussi, resigned (See below). This enabled Deutsche Börse to purchase the remaining 50% of Clearstream International in July 2002. According to some, such as Business Week, Lussi had opposed such a takeover.
Clearstream is audited by KPMG
, one of the largest global accounting firms. KPMG declared that it found "no evidence" to support the allegations made by Denis Robert and Ernest Backes, although its report was not made public.
was split apart in 2000, Clearstream became the subject of two commissions of inquiry in Lorraine
(France) conducted before the French parliament and European parliament
both of which had no results.
and Ernest Backes released a book called "Révélation$," followed by Robert's "La Boîte Noire," describing what has been named the "greatest financial scandal in the Grand Duchy of Luxembourg." The little publicity their works received came only in the French media, and even there publicity was minimal. In a number of interviews, Denis Robert accused "Le Monde
" of deliberately suppressing articles and reviews of his book, suggesting that financial links between "Le Monde" and Deutsche Börse (which now owns 100% of Clearstream's shares) were the cause of this censorship. Denis Robert was found guilty of libel and sentenced altogether 8 times by the French courts for describing Clearstream as a huge money laundering and tax evasion machine, used by major banks, shell companies, and organized crime
all over the world. (Paris Court of Appeal, 16, October 2008, 18 December 2008, Tribunal correctionnel de Bordeaux, June 2008). He has been cleared of all charged in February 2011 by the Cour de Cassation (http://tempsreel.nouvelobs.com/actualite/societe/20110205.OBS7554/clearstream-denis-robert-est-blanchi.html).
," one of Italy's major political scandals. Two months after his dismissal, Gérard Soisson
was found dead in Corsica
. The Banco Ambrosiano, allegedly involved in money-laundering for the Mafia
and owned in majority by the Vatican Bank
, collapsed in 1982. The bank "laundered drugs- and arms-trafficking money for the Italian and American Mafias, and in the 1980s it channeled Vatican money to the Contras in Nicaragua
and to Solidarity in Poland
", according to Komisar.
In 2005, the Italian justice system reopened its investigation of the murder of Roberto Calvi
, Ambrosiano's chairman; it has requested the support of Ernest Backes, and will investigate Gerard Soisson's death, according to Komisar. Licio Gelli
, headmaster of Propaganda Due
masonic lodge
(aka P2, it was involved in Gladio's "strategy of tension
" starting from the 1969 Piazza Fontana bombing
), and mafiosi Giuseppe Calo
, are being prosecuted for the assassination of Roberto Calvi
. Ernest Backes explained: "When Soisson died, the Ambrosiano affair wasn't yet known as a scandal. (After it was revealed) I realized that Soisson and I had been at the crossroads. We moved all those transactions known later in the scandal to Lima
and other branches. Nobody even knew there was a Banco Ambrosiano branch in Lima and other South American countries."
was the person who authorized each non-published account, "which would be known only by some insiders, including the auditors and members of the council of administration."
Only authorized banks, supranational and government entities, brokers/financial institutions (provided that the institution is subject to regulation by an acceptable regulatory authority) and general corporates as triparty repo cash providers are eligible customers of Clearstream. Individuals are not eligible as Clearstream Banking customers. Accounts are opened in the name of their legal owners. Each customer is free in asking for the opening of subsequent accounts. All main and subsequent accounts are subject to the same rules and internal control procedures and regulatory supervision. Some subsequent account names contain, beside the customer name, an indication as to third parties. These accounts are not opened for individual persons but on instruction of the legal owner of the account.
Banks in most countries worldwide do generally not publish their customers’ account numbers, due to the banking secrecy and legitimate customer personal protection reasons. Depending on the nature of the business executed through Clearstream, customers elect for their account numbers to be published or unpublished. Customers may elect to provide other Clearstream customers with their respective account numbers to ease the settlement process, i.e. publish their account numbers. For other Clearstream services, e.g. the safekeeping of securities as well as the associated services, such as corporate actions on the deposited securities, customers do not need to publish their account numbers to other market participants. This practice is entirely consistent with international banking industry standards.
The non-publication of account numbers does not mean that these accounts are hidden or secret and unknown to Clearstream’s staff and management, the internal and external auditors and the regulatory authorities. To the contrary, all customer accounts, published and non-published, are all continually reviewed, monitored and reported to the regulators as needed.
Another belief of Denis Robert's book is that, according to the May 9, 2001 op-ed by Bernard Bertossa
, attorney general
in Geneva
, Benoît Dejemeppe, king's attorney in Brussels
(procureur du roi), Eva Joly
, investigative magistrate in Paris, Jean de Maillard
, magistrate
in Blois
and Renaud van Ruymbeke
, a judge in Paris, entitled "The 'black boxes' of financial globalization," is that:
In other words, all financial money flows, legal or illegal, have to pass through the financial system.
, had been inscribed in the Swiss register of commerce but not included in the books of the mother company, Cedel International in Luxembourg. "This non-consolidated 'branch,' whose president is Robert Douglass of New York, former private secretary of Governor Nelson Rockefeller
, and vice chairman of the Chase Manhattan Corporation (now J.P. Morgan Chase), apparently had not raised too many questions for Swiss federal magistrates." Backes qualified this "black box" as "institutionalized tax evasion at highest level in world finance,", noting that tax evasion was even "more or less expressed in the objectives of the company as filed in the Swiss register of commerce." The "branch" has since "been resold to another Luxembourg holding company, with the people in the backyard remaining mostly the same."
and Vincent Peillon
, entitled "Parliamentary Report on the obstacles on the control and repression of financial criminal activity and of money-laundering in Europe," dedicated its whole third section to "Luxembourg's political dependency toward the financial sector: the Clearstream affair."
of Luxembourg opened up an investigation on February 26, 2001. On November 30, 2004, the parquet finally declared no proof of "systematic manipulations" had been found, and that investigations would continue on suspicion of manipulation and tax evasion
regarding former Clearstream CEO André lussi. This also led to a non lieu (Statement from the Luxembourg Parquet, November 2004).
Denis Robert also has been sued for defamation by other banks and companies incriminated by the book: 50+ different cases — among which Bank Menatep
, Banque Générale du Luxembourg, etc., in which the author and his editor Laurent Beccaria were acquitted in all but two cases, and damages for both cases of one Euro were awarded. On January 27, 2006, once more Denis Robert was charged by a Luxembourg committing magistrate
for defamation, slander, and insults.
A complaint was opened in March 2001 against Ernest Backes, and Denis Robert was included in it five years later: "I am very surprised of this accusation five years after the facts and of the energy which the Luxembourgian justice puts continuing to harass me while it was not at the end of the inquiry opened for money laundering, tax evasion and corruption against Clearstream", Robert said. An organization, "Freedom to inform," declared to Le Nouvel Observateur
magazine that "By transforming the affair Robert in affair Frieden
(Luxembourg Minister of Justice, of the Treasury and the Budget), every signature will be a civil act which protects the freedom of the media in Europe."
position at Clearstream, and on December 31, 2001, he departed the company on mutual agreement. In February 2004 an investigation was opened against him, on money laundering, fraud, and tax evasion charges. André Lussi was replaced by André Roelants, who had been at Dexia
. After years of investigations, all allegations made against André Lussi turned out to be completely causeless and the lawsuits were abandoned by the courts.
in March 2001 and also to the French National Assembly
. Answering the question raised by European MPs (MEP) Harlem Désir
, Glyn Ford
and Francis Wurtz
, who asked the Commission to investigate the accusations made by the book and to ensure that the 10 June 1990 directive (91/308 EC) on control of financial establishment be applied in all member states in an effective way, Commissioner Frits Bolkestein
observed that "the Commission has no reason to date to believe that the Luxembourg authorities do not apply it vigorously".
On April 26, 2006, 20 Minutes
revealed that "in May 2005, MEP Paul Van Buitenen was shocked by Frits Bolkestein's presence on Menatep
's international consultative council, a Russian banking establishment, and by his work for Shell
, a British-Dutch petrol company, two firms 'maintaining secret accounts in Clearstream'... Van Buitenen, also Dutch, then asked for 'clarification' to the European Commission and the opening of a parliamentary investigation. The Commission's president, José Manuel Barroso, replied that these facts 'do not bring up any new question' and that it is not known 'if Menatep made contact with Bolkestein while he was in these positions'. No investigation therefore took place."
The free daily points out that "in 2001, it was Bolkestein himself who announced the Commission's refusal to open up a parliamentary investigation on Clearstream", following Harlem Désir's requests and accusations that Menatep had an "undeclared account" at Clearstream. Bolkestein refused to answer any questions by the newspaper, which recalls that Van Buitenen, former European public servant, had already revealed a vast corruption affair in 1999, which led to the resignation of the Commission presided by Jacques Santer (who has also been prime minister of Luxembourg) and the fall of Edith Cresson
.
Furthermore, two Belgian Senators, Isabelle Durant
and Jean Cornil, proposed a law in vain in 2004 to create a national investigation commission charged with the investigation of the use of accounts in "clearing and routing firms" to commit fiscal frauds (tax evasion) and/or money-laundering.
against "John Doe," targeting this time the anonymous denunciations claiming that Nicolas Sarkozy and other French political personalities had secret accounts at Clearstream, which would have been used for hypothetical kickbacks. Former French Prime Minister Dominique de Villepin
came under investigation for what may have been his involvement in spreading the false charges against the current French President Sarkozy, but was later acquitted in January 2010, although three of his co-defendants were found guilty.
Furthermore it answered questions of 20 Minutes
in an interview, denying knowing anything about the various attempts to create European-level investigations commissions about its internal workings. It also denied "the existence of parallel accounts" and of "personal accounts" (in response, Denis Robert published a list of several personal accounts on his blog). However, the company did recognize that "a banking establishment may request an unpublished account, that is, an account only known by the establishments concerned by the transaction, control authorities, and the auditors of the firm". Clearstream also indicated that it had "spent 15 million euros on various audits without finding anything," Denis Robert's accusations.
i-born Nadhmi Auchi
, # 34 on the "Sunday Times Rich List 2004" (# 22 on the same list in 2005) and 13th richest man in Britain according to The Guardian
, estimated to be worth $1 billion according to Forbes
, also appeared to be a key figure.
Auchi was convicted of profiteering
by the Paris Criminal Court, and received a 15-month suspended sentence
, for his involvement in Elf's scandal, "the biggest fraud inquiry in Europe since the Second World War. Elf became a private bank for its executives who spent £200 million on political favours, mistresses, jewellery, fine art, villas and apartments". The "Guardian" noted that Nadhmi Auchi had helped Orascom (which owns Djezzy GSM
), owned by Onsi Sawiris
(worth $5.2 billion with his family according to Forbes), gain a contract to set up mobile phone networks in post-Saddam's
Iraq. As owner of the General Mediterranean Holdings
, Auchi is the largest private shareholder of BNP Paribas
, which until 2001 managed the escrow
account through which the money from the Oil-for-Food programme
transited.
, was involved in the "Kremlingate", when $4.8 billion in International Monetary Fund
funds were diverted to various banks, including US banks. It opened up its non-published Cedel account #81 738 on May 15, 1997. "Menatep further violated the rules because many transfers were of cash, not for settlement of securities", writes Komisar. "For the three months in 1997 for which I hold microfiches, Backes says, only cash transfers were transferred through the Meanatep account. There were a lot of transfers between Menatep and the Bank of New York
." Natasha Gurfinkel Kagalovsky, a former Bank of New York official and the wife of a Menatep vice-president, was accused of helping launder at least $7 billion from Russia, according to Komisar. US investigators have attempted to find out if some of the laundered money originated with Menatep.
On November 26, 2003, Backes and another ex-banker, Swiss citizen André Strebel, filed a criminal complaint with the Swiss attorney general against Khodorkovsky and his colleagues Platon Lebedev
and Alexei Golubovich, accusing them of money-laundering and supporting a criminal organization. They requested an investigation and a search of records of the Swiss office of Menatep SA, Menatep Finances SA, Valmet
. and of Bank Leu
in Geneva
, related to claims of fraud
against the Russian company Avisma and money-laundering by Menatep in Switzerland. According to this complaint, Bank Menatep has been linked since its creation to the Russian oligarchy and criminal organizations, such as Khodorkovsky, Alexander Konanykhine and the Russian godfather
Semion Mogilevich
. "Even though Menatep officially failed in 1998, it oddly remained on the non-published list of Clearstream accounts for 2000", wrote Komisar. Clearstream's listings also present 36 other Russian accounts, most non-published.
In April 2006, Clearstream declared, to the French edition of 20 Minutes
, that if "Menatep may have strange accounts, it wasn't closed because of money-laundering". It also claimed that it dealt with "banks accredited in their country of origin", but not with "establishments that are registered on the Financial Action Task Force on Money Laundering
's black list".
accused various important French political figures of having received kickbacks related to the Taiwan frigates scandal, through secret personal accounts at Clearstream. Clearstream was again pointed out as having been a major platform for illegal financial transactions. After thorough investigation including search in Clearstream's archives and accounts, M Van Ruymbecke found absolutely no evidence of the validity of the allegations and closed the case.
After an investigation by judges On September 3, 2004, the Paris parquet (public prosecutor) opened an investigation into charges of "defamation", following a complaint by Philippe Delmas, EADS' vice-president. Magistrates Jean-Marie d'Huy and Henri Pons have charged Dominique de Villepin, former French PM, Jean-Louis Gergorin
, former EADS executive who confessed having been the poison pen in the case, Imad Lahoud, Florian bourges and Denis Robert. Their trial started on 21 September 2009.
and Dominique Talancé, the French magistrates in charge of the Taiwan frigates scandal, received two letters and a CD-ROM from an anonymous informant (called corbeau in French), detailing numbered bank account
s maintained at Clearstream and describing secret transfers of millions of dollars. Many personalities were named, including Alain Gomez, former director of Thomson-CSF
(which since has become Thales
), Andrew Wang, the Taiwanese intermediary of the frigates contract and one of Taiwan's key figures concerning arms contracts, Philippe Delmas, vice-president of EADS
the European aeronautics consortium, and Nicolas Sarkozy
, then minister of the Economy, Dominique Strauss-Kahn
, Jean-Pierre Chevènement
, and others. Members of the French secret services also were named.
Magistrate Van Ruymbeke opened another investigation, in July 2004. According to the denunciations, Andrew Wang passed on money to several very important French officials from 1999 to 2003, using Clearstream.
But in January 2006, both magistrates declared the case closed, on the grounds that the corbeau 's list of Clearstream accounts owned by various political figures was a fraud. For example, the numbered Banca popolare di Sondrio Clearstream account, supposedly in the names of "Stéphane Bocsa" and "Paul de Nagy" — French president, Nicolas Sarkozy
's full name is "Nicolas Paul Stéphane Sarkozy de Nagy-Bocsa" — was not Sarkozy's personal account, but an account used by various persons, according to the declarations of the Banca popolare di Sondrio to Judge Ruymbeke.
s offices in May 2007, after the election of Nicolas Sarkozy to the presidency
. According to editing director Claude Angeli, the judges were looking for information on a "Rondot document" treating of alleged "Japanese accounts" of former President Jacques Chirac
. The judges were not allowed access to the newspaper's offices, and Reporters Without Borders
(RSF) protested against the search.
and Citibank
, on January 16, 1980, to pay for the liberation of the American hostages held in Tehran's embassy (Iran). He gave copies of files that he asserted shed new light on the October surprise conspiracy to the French National Assembly
.
ian funds in a Citibank
account. Since 2008, these funds have been ordered frozen by the U.S. District Court for the Southern District of New York, and are intended for use to pay the families of hundreds of US Marines killed and injured in a 1983 Beirut
bombing that a US federal judge ruled was orchestrated by Iran
, according to the Wall Street Journal.
Clearing (finance)
In banking and finance, clearing denotes all activities from the time a commitment is made for a transaction until it is settled. Clearing is necessary because the speed of trades is much faster than the cycle time for completing the underlying transaction....
and settlement
Settlement (finance)
Settlement of securities is a business process whereby securities or interests in securities are delivered, usually against payment of money, to fulfill contractual obligations, such as those arising under securities trades....
division of Deutsche Börse
Deutsche Börse
Deutsche Börse AG is a marketplace organizer for the trading of shares and other securities. It also is a transaction services provider. It gives companies and investors access to global capital markets. It is a joint stock company and was founded in 1993. The headquarters are in Frankfurt,...
, based in Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
and Frankfurt
Frankfurt
Frankfurt am Main , commonly known simply as Frankfurt, is the largest city in the German state of Hesse and the fifth-largest city in Germany, with a 2010 population of 688,249. The urban area had an estimated population of 2,300,000 in 2010...
.
Clearstream was created in January 2000 through the merger of Cedel International
Cedel
Cedel was a clearing company of securities. It was founded in 1971 and was owned by of 92 banks. Since July 2002 it is a division of Deutsche Börse, and known as Clearstream....
and Deutsche Börse Clearing. Its main functions are acting as International Central Securities Depository
Central Securities Depository
A Central Securities Depository is an organization holding securities either in certificated or uncertificated form, to enable book entry transfer of securities. In some cases these organizations also carry out centralized comparison, and transaction processing such as clearing and settlement of...
(ICSD), Clearstream also acts as the Central Securities Depository (CSD) for Germany and Clearing House
Clearing house (finance)
A clearing house is a financial institution that provides clearing and settlement services for financial and commodities derivatives and securities transactions...
for a number of securities
Security (finance)
A security is generally a fungible, negotiable financial instrument representing financial value. Securities are broadly categorized into:* debt securities ,* equity securities, e.g., common stocks; and,...
. It is one of the biggest custodians and clearer of the eurobond
Eurobond
A Eurobond is an international bond that is denominated in a currency not native to the country where it is issued. It can be categorised according to the currency in which it is issued. London is one of the centers of the Eurobond market, but Eurobonds may be traded throughout the world - for...
s market.
Clearstream has been criticized for allowing banks to move money undetected and has been accused of involvements in a number of cases involving money laundering
Money laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
and tax evasion
Tax evasion
Tax evasion is the general term for efforts by individuals, corporations, trusts and other entities to evade taxes by illegal means. Tax evasion usually entails taxpayers deliberately misrepresenting or concealing the true state of their affairs to the tax authorities to reduce their tax liability,...
. Two notable cases have become known as the Clearstream Affair
Clearstream affair
The "Clearstream affair" was a political scandal in France in the run-up to the 2007 presidential election.The name refers to the Luxembourg bank Clearstream Banking S.A., now wholly owned by Deutsche Börse, which was alleged to have aided many prominent French politicians and companies evade taxes...
which started with the release of the book Révélation$ in 2001 by the investigative reporter Denis Robert
Denis Robert
Denis Robert is a French freelance journalist and a writer. Robert formerly worked for Libération newspaper for 12 years....
and ex-Clearstream banker Ernest Backes and the Second Clearstream Affair which started in 2004 when anonymous denunciations was sent to magistrate Renaud Van Ruymbeke
Renaud Van Ruymbeke
Renaud van Ruymbeke is a French investigative magistrate, well known for specializing in political and financial corruption cases, who investigated on the French-Taiwan frigates Affair, which has been related to the Clearstream scandal, and on the Urba affair.- Bibliography :*Renaud van Ruymbeke,...
accusing a number of major French political figures of having received kickbacks.
History
Clearstream was formed in 1971 as Cedel, specialising in the delivery and settlement eurobonds. It was created by a consortium of banks as a competitor to EuroclearEuroclear
Euroclear is a user owned and governed Brussels, Belgium based financial services company that specializes in the settlement of securities transactions as well as the safekeeping and asset servicing of these securities. It was founded in 1968 as part of J.P...
, which was then owned by US bank J.P. Morgan & Co.
J.P. Morgan & Co.
J.P. Morgan & Co. was a commercial and investment banking institution based in the United States founded by J. Pierpont Morgan and commonly known as the House of Morgan or simply Morgan. Today, J.P...
, being a monopoly in this area.
Clearstream's customers are banks or financial institutions who have accounts with Clearstream which are used to settled and delivered eurobonds with their counterparts. No individual can open an account with Clearstream.
In 1996, Clearstream obtained its own banking license.
In January 2000 it became Clearstream through the merger of Cedel International and Deutsche Börse Clearing, a subsidiary of Deutsche Börse Group, which owns the Frankfurt Stock Exchange
Frankfurt Stock Exchange
The Frankfurt Stock Exchange is the world's 12th largest stock exchange by market capitalization. Located in Frankfurt am Main, Germany, the Frankfurt Stock Exchange is owned and operated by Deutsche Börse, which also owns the European futures exchange Eurex and the clearing company...
when it took a 50% shareholding.
In July 2002, Deutsche Boerse bought the remaining 50% of Clearstream International for 1.6 billion euros.
In 2009 Clearstream contributed earnings before interest and taxes
Earnings before interest and taxes
In accounting and finance, earnings before interest and taxes is a measure of a firm's profit that excludes interest and income tax expenses. Operating income is the difference between operating revenues and operating expenses...
of €720 million to Deutsche Börse. It handled 102 million transactions, and was custodian of securities worth €10.3 trillion.
Settlement and custody
Clearstream often has been described as a bank for banks, as it practices what is called settlement and custody operations ("Plumbers and Visionaries, a history of settlement and custody in Europe", Peter Norman). Basically, its duty is to record transactions between the accounts of different banks, and use that data to calculate the relative financial positions of banks with regard to each other.So a bank can just order a transaction between its own account and the other bank's account, in lieu of less secure methods such as carrying a case full of currency or securities around on the street; the bank merely transmits an order to Clearstream to credit/debit one of its own accounts and the other bank's account(s). This general system is in use between regular companies, governments, and banks around the world.
The purpose of International central securities depositories like Euroclear and Clearstream is to facilitate money movements
Value transfer system
A value transfer system refers to any system, mechanism, or network of people that receives money for the purpose of making the funds or an equivalent value payable to a third party in another geographic location, whether or not in the same form....
around the world, particularly by handling the resolution of sales of European stocks
Stocks
Stocks are devices used in the medieval and colonial American times as a form of physical punishment involving public humiliation. The stocks partially immobilized its victims and they were often exposed in a public place such as the site of a market to the scorn of those who passed by...
and bonds
Bond (finance)
In finance, a bond is a debt security, in which the authorized issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay interest to use and/or to repay the principal at a later date, termed maturity...
, in which market Clearstream is a major player, with an estimated 40% market share
Market share
Market share is the percentage of a market accounted for by a specific entity. In a survey of nearly 200 senior marketing managers, 67 percent responded that they found the "dollar market share" metric very useful, while 61% found "unit market share" very useful.Marketers need to be able to...
until May 2008 - together with its competitor Euroclear
Euroclear
Euroclear is a user owned and governed Brussels, Belgium based financial services company that specializes in the settlement of securities transactions as well as the safekeeping and asset servicing of these securities. It was founded in 1968 as part of J.P...
, the two firms settle 70% of European transactions. Furthermore, in January 2009, Clearstream was the 11th largest employer in Luxembourg.
Clearstream does not hold a monopoly in this market: Euroclear, owned by the market, and custodian banks (Bank of New York-Mellon..] are competitors. ; Clearstream's quasi-monopoly
Monopoly
A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity...
is demonstrated by this European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
statement declaring that "Clearstream Banking AG is an unavoidable trader partner."
Euroclear was created by JP Morgan in 1968 in Brussels
Brussels
Brussels , officially the Brussels Region or Brussels-Capital Region , is the capital of Belgium and the de facto capital of the European Union...
(Belgium). By the end of 2000, JP Morgan had extricated itself from Euroclear, but JP Morgan still is one of the 120 international banks which own shares in Euroclear. In 2000, Euroclear processed 145 million transactions, dealing with a total of 100,000 billion euros.
Euros
Cedel (now Clearstream) and Euroclear were started to manage transfers of "eurobonds," U.S. denominated debt instruments issued in Europe and kept in banks outside the United StatesUnited States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
. By the 1990s, the U.S. Federal Reserve estimated that about 2/3 of U.S. currency was held abroad as eurodollars.
Clearstream's dominant position
On June 2, 2004, the European CommissionEuropean Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
found that "Clearstream Banking AG and its parent company
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
Clearstream International SA ("Clearstream") infringed competition rules by refusing to supply cross-border securities clearing and settlement services, and by applying discriminatory prices. Clearstream has appealed in front of the European Court of Justice. The case was pleaded in July 2008 and the decision is pending.
The Commission’s investigation revealed that Clearstream refused to supply Euroclear Bank SA ('Euroclear Bank') with certain clearing and settlement services, and applied discriminatory prices to the detriment of this customer."
The decision states that "Clearstream refused to supply to Euroclear Bank clearing and settlement services for registered shares issued under German law
Law of Germany
The modern German legal system is a system of law which is founded on the principles laid out by the Basic Law for the Federal Republic of Germany, though many of the most important laws as for example most regulations of the civil code were developed prior to the 1949 constitution...
," underlining the "dominant position" of Clearstream since it "is the only final custodian of German securities kept in collective safe custody, which is the only significant form of custody today for securities traded. New entry into this activity is unrealistic for the foreseeable future. Therefore, Clearstream is an unavoidable trading partner."
The Commission defined clearing
Clearing (finance)
In banking and finance, clearing denotes all activities from the time a commitment is made for a transaction until it is settled. Clearing is necessary because the speed of trades is much faster than the cycle time for completing the underlying transaction....
and settlement
Settlement (finance)
Settlement of securities is a business process whereby securities or interests in securities are delivered, usually against payment of money, to fulfill contractual obligations, such as those arising under securities trades....
as follows:
- "Securities clearing and settlement are necessary steps for a securities trade to be completed.
- Clearing is the process by which the contractual obligations of the buyer and the seller are established.
- Settlement is the transfer of securities from the seller to the buyer and the transfer of funds from the buyer to the seller. (...)
- Clearstream Banking AG is Germany's only Wertpapiersammelbank (Central Securities DepositoryCentral Securities DepositoryA Central Securities Depository is an organization holding securities either in certificated or uncertificated form, to enable book entry transfer of securities. In some cases these organizations also carry out centralized comparison, and transaction processing such as clearing and settlement of...
).
"The Commission considered that during the reference period concerned, 1997 through 2001, Clearstream held a dominant position for providing cross-border clearing and settlement services to intermediaries situated in other member states. The investigation therefore focused on a specific cross-border market and the decision does not set out findings that go beyond that relevant market."
The Commission underlined in a note that, "Central Securities Depositories hold securities and enable securities transactions to be processed through book entry
Book entry
Book entry is a system of tracking ownership of securities where no certificate is given to investors. In the case of book-entry-only issues, while investors do not receive certificates, a custodian holds one or more global certificates...
. In its home country, the Central Securities Depository provides processing services for trades of those securities that it holds in final custody. It can also offer processing services as an intermediary in cross-border clearing and settlement, where the primary deposit of securities is in another country."
Accusations
In 2001, investigative reporter Denis RobertDenis Robert
Denis Robert is a French freelance journalist and a writer. Robert formerly worked for Libération newspaper for 12 years....
and Ernest Backes, an executive at Cedel until May 1983, published a book, Revelation$ in which they alleged that Clearstream played a major part in the underground economy
Underground economy
A black market or underground economy is a market in goods or services which operates outside the formal one supported by established state power. Typically the totality of such activity is referred to with the definite article as a complement to the official economies, by market for such goods and...
, was a main platform for money laundering
Money laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
for hundreds of banks, and "operated hundreds of confidential accounts for banks so they could move money undetected," according to Business Week.
Backes and Le Figaro
Le Figaro
Le Figaro is a French daily newspaper founded in 1826 and published in Paris. It is one of three French newspapers of record, with Le Monde and Libération, and is the oldest newspaper in France. It is also the second-largest national newspaper in France after Le Parisien and before Le Monde, but...
were sued by Clearstream and found guilty of libel on March 29, 2004. Denis Robert was sued for libel and found guilty three on three counts on appeal on 16 October 2008 for the books Revelation$ and Black Box, as well as the documentary "Les Dissimulateurs" (The Deceivers). However, in February 2011, in a final judgment, the Court of Cassation
Court of Cassation (France)
The French Supreme Court of Judicature is France's court of last resort having jurisdiction over all matters triable in the judicial stream but only scope of review to determine a miscarriage of justice or certify a question of law based solely on points of law...
overturned all convictions, ruling that his work was protected by freedom of speech and of the press.
After an investigation in Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
, which was closed in November 2004 after no evidence had been found of wrongdoing (Luxembourg prosecutor's office, Nov. 30, 2004), on suspicion of money laundering, tax evasion, and other fraud, Clearstream's CEO, André Lussi, resigned (See below). This enabled Deutsche Börse to purchase the remaining 50% of Clearstream International in July 2002. According to some, such as Business Week, Lussi had opposed such a takeover.
Clearstream is audited by KPMG
KPMG
KPMG is one of the largest professional services networks in the world and one of the Big Four auditors, along with Deloitte, Ernst & Young and PwC. Its global headquarters is located in Amstelveen, Netherlands....
, one of the largest global accounting firms. KPMG declared that it found "no evidence" to support the allegations made by Denis Robert and Ernest Backes, although its report was not made public.
Daewoo shutdown inquiries
After DaewooDaewoo
Daewoo or the Daewoo Group was a major South Korean chaebol . It was founded on 22 March 1967 as Daewoo Industrial and was dismantled by the Korean government in 1999...
was split apart in 2000, Clearstream became the subject of two commissions of inquiry in Lorraine
Lorraine (région)
Lorraine is one of the 27 régions of France. The administrative region has two cities of equal importance, Metz and Nancy. Metz is considered to be the official capital since that is where the regional parliament is situated...
(France) conducted before the French parliament and European parliament
European Parliament
The European Parliament is the directly elected parliamentary institution of the European Union . Together with the Council of the European Union and the Commission, it exercises the legislative function of the EU and it has been described as one of the most powerful legislatures in the world...
both of which had no results.
The Clearstream affair
In 2001, co-authors Denis RobertDenis Robert
Denis Robert is a French freelance journalist and a writer. Robert formerly worked for Libération newspaper for 12 years....
and Ernest Backes released a book called "Révélation$," followed by Robert's "La Boîte Noire," describing what has been named the "greatest financial scandal in the Grand Duchy of Luxembourg." The little publicity their works received came only in the French media, and even there publicity was minimal. In a number of interviews, Denis Robert accused "Le Monde
Le Monde
Le Monde is a French daily evening newspaper owned by La Vie-Le Monde Group and edited in Paris. It is one of two French newspapers of record, and has generally been well respected since its first edition under founder Hubert Beuve-Méry on 19 December 1944...
" of deliberately suppressing articles and reviews of his book, suggesting that financial links between "Le Monde" and Deutsche Börse (which now owns 100% of Clearstream's shares) were the cause of this censorship. Denis Robert was found guilty of libel and sentenced altogether 8 times by the French courts for describing Clearstream as a huge money laundering and tax evasion machine, used by major banks, shell companies, and organized crime
Organized crime
Organized crime or criminal organizations are transnational, national, or local groupings of highly centralized enterprises run by criminals for the purpose of engaging in illegal activity, most commonly for monetary profit. Some criminal organizations, such as terrorist organizations, are...
all over the world. (Paris Court of Appeal, 16, October 2008, 18 December 2008, Tribunal correctionnel de Bordeaux, June 2008). He has been cleared of all charged in February 2011 by the Cour de Cassation (http://tempsreel.nouvelobs.com/actualite/societe/20110205.OBS7554/clearstream-denis-robert-est-blanchi.html).
Banco Ambrosiano scandal
By 1980, Ernest Backes had become Cedel's #3, in charge of relations with clients, but he was fired in May 1983, allegedly because he "knew too much about the Ambrosiano scandalBanco Ambrosiano
Banco Ambrosiano was an Italian bank which collapsed in 1982. At the centre of the bank's failure was its chairman, Roberto Calvi and his membership in the illegal Masonic Lodge Propaganda Due...
," one of Italy's major political scandals. Two months after his dismissal, Gérard Soisson
Gérard Soisson
Gérard Soisson was a French banker who was at the center of the Clearstream Affair. He was the person who authorized each non-published account, which would be known only by some insiders, including the auditors and members of the council of administration.Whereas Soisson had refused numerous...
was found dead in Corsica
Corsica
Corsica is an island in the Mediterranean Sea. It is located west of Italy, southeast of the French mainland, and north of the island of Sardinia....
. The Banco Ambrosiano, allegedly involved in money-laundering for the Mafia
Mafia
The Mafia is a criminal syndicate that emerged in the mid-nineteenth century in Sicily, Italy. It is a loose association of criminal groups that share a common organizational structure and code of conduct, and whose common enterprise is protection racketeering...
and owned in majority by the Vatican Bank
Vatican Bank
The Institute for Works of Religion , commonly known as the Vatican Bank, is a privately held institute located inside Vatican City run by a professional bank CEO who reports directly to a committee of cardinals, and ultimately to the Pope...
, collapsed in 1982. The bank "laundered drugs- and arms-trafficking money for the Italian and American Mafias, and in the 1980s it channeled Vatican money to the Contras in Nicaragua
Nicaragua
Nicaragua is the largest country in the Central American American isthmus, bordered by Honduras to the north and Costa Rica to the south. The country is situated between 11 and 14 degrees north of the Equator in the Northern Hemisphere, which places it entirely within the tropics. The Pacific Ocean...
and to Solidarity in Poland
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
", according to Komisar.
In 2005, the Italian justice system reopened its investigation of the murder of Roberto Calvi
Roberto Calvi
Roberto Calvi was an Italian banker dubbed "God's Banker" by the press because of his close association with the Holy See. A native of Milan, Calvi was Chairman of Banco Ambrosiano, which collapsed in one of modern Italy's biggest political scandals...
, Ambrosiano's chairman; it has requested the support of Ernest Backes, and will investigate Gerard Soisson's death, according to Komisar. Licio Gelli
Licio Gelli
Licio Gelli is an Italian financier, chiefly known for his role in the Banco Ambrosiano scandal. He was revealed in 1981 as being the Venerable Master of the clandestine Masonic lodge Propaganda Due...
, headmaster of Propaganda Due
Propaganda Due
Propaganda Due , or P2, was a Masonic lodge operating under the jurisdiction of the Grand Orient of Italy from 1945 to 1976 , and a pseudo-Masonic or "black" or "covert" lodge operating illegally from 1976 to...
masonic lodge
Masonic Lodge
This article is about the Masonic term for a membership group. For buildings named Masonic Lodge, see Masonic Lodge A Masonic Lodge, often termed a Private Lodge or Constituent Lodge, is the basic organisation of Freemasonry...
(aka P2, it was involved in Gladio's "strategy of tension
Strategy of tension
The strategy of tension is a theory that describes how to divide, manipulate, and control public opinion using fear, propaganda, disinformation, psychological warfare, agents provocateurs, and false flag terrorist actions....
" starting from the 1969 Piazza Fontana bombing
Piazza Fontana bombing
The Piazza Fontana Bombing was a terrorist attack that occurred on December 12, 1969 at 16:37, when a bomb exploded at the headquarters of Banca Nazionale dell'Agricoltura in Piazza Fontana in Milan, Italy, killing 17 people and wounding 88...
), and mafiosi Giuseppe Calo
Giuseppe Calò
Giuseppe 'Pippo' Calò is a member of the Sicilian Mafia. He was referred to as the "Mafia's Cashier" because he was heavily involved in the financial side of organized crime, primarily money laundering....
, are being prosecuted for the assassination of Roberto Calvi
Roberto Calvi
Roberto Calvi was an Italian banker dubbed "God's Banker" by the press because of his close association with the Holy See. A native of Milan, Calvi was Chairman of Banco Ambrosiano, which collapsed in one of modern Italy's biggest political scandals...
. Ernest Backes explained: "When Soisson died, the Ambrosiano affair wasn't yet known as a scandal. (After it was revealed) I realized that Soisson and I had been at the crossroads. We moved all those transactions known later in the scandal to Lima
Lima
Lima is the capital and the largest city of Peru. It is located in the valleys of the Chillón, Rímac and Lurín rivers, in the central part of the country, on a desert coast overlooking the Pacific Ocean. Together with the seaport of Callao, it forms a contiguous urban area known as the Lima...
and other branches. Nobody even knew there was a Banco Ambrosiano branch in Lima and other South American countries."
Secret accounts and the workings of 21st century economics
Gérard SoissonGérard Soisson
Gérard Soisson was a French banker who was at the center of the Clearstream Affair. He was the person who authorized each non-published account, which would be known only by some insiders, including the auditors and members of the council of administration.Whereas Soisson had refused numerous...
was the person who authorized each non-published account, "which would be known only by some insiders, including the auditors and members of the council of administration."
Only authorized banks, supranational and government entities, brokers/financial institutions (provided that the institution is subject to regulation by an acceptable regulatory authority) and general corporates as triparty repo cash providers are eligible customers of Clearstream. Individuals are not eligible as Clearstream Banking customers. Accounts are opened in the name of their legal owners. Each customer is free in asking for the opening of subsequent accounts. All main and subsequent accounts are subject to the same rules and internal control procedures and regulatory supervision. Some subsequent account names contain, beside the customer name, an indication as to third parties. These accounts are not opened for individual persons but on instruction of the legal owner of the account.
Banks in most countries worldwide do generally not publish their customers’ account numbers, due to the banking secrecy and legitimate customer personal protection reasons. Depending on the nature of the business executed through Clearstream, customers elect for their account numbers to be published or unpublished. Customers may elect to provide other Clearstream customers with their respective account numbers to ease the settlement process, i.e. publish their account numbers. For other Clearstream services, e.g. the safekeeping of securities as well as the associated services, such as corporate actions on the deposited securities, customers do not need to publish their account numbers to other market participants. This practice is entirely consistent with international banking industry standards.
The non-publication of account numbers does not mean that these accounts are hidden or secret and unknown to Clearstream’s staff and management, the internal and external auditors and the regulatory authorities. To the contrary, all customer accounts, published and non-published, are all continually reviewed, monitored and reported to the regulators as needed.
Another belief of Denis Robert's book is that, according to the May 9, 2001 op-ed by Bernard Bertossa
Bernard Bertossa
Bernard Bertossa was Geneva's public prosecutor from 1990 to 2002. He signed the 1996 Appel de Genève against international money laundering and other financial criminal activities...
, attorney general
Attorney General
In most common law jurisdictions, the attorney general, or attorney-general, is the main legal advisor to the government, and in some jurisdictions he or she may also have executive responsibility for law enforcement or responsibility for public prosecutions.The term is used to refer to any person...
in Geneva
Geneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...
, Benoît Dejemeppe, king's attorney in Brussels
Brussels
Brussels , officially the Brussels Region or Brussels-Capital Region , is the capital of Belgium and the de facto capital of the European Union...
(procureur du roi), Eva Joly
Eva Joly
Eva Joly is a Norwegian-born French magistrate and politician for the French Green Party.-Early life:Born in Grünerløkka, Oslo, she moved to Paris at 20 to work as an au pair...
, investigative magistrate in Paris, Jean de Maillard
Jean de Maillard
Jean de Maillard is a French magistrate in Blois.He wrote several books concerning financial crime...
, magistrate
Magistrate
A magistrate is an officer of the state; in modern usage the term usually refers to a judge or prosecutor. This was not always the case; in ancient Rome, a magistratus was one of the highest government officers and possessed both judicial and executive powers. Today, in common law systems, a...
in Blois
Blois
Blois is the capital of Loir-et-Cher department in central France, situated on the banks of the lower river Loire between Orléans and Tours.-History:...
and Renaud van Ruymbeke
Renaud Van Ruymbeke
Renaud van Ruymbeke is a French investigative magistrate, well known for specializing in political and financial corruption cases, who investigated on the French-Taiwan frigates Affair, which has been related to the Clearstream scandal, and on the Urba affair.- Bibliography :*Renaud van Ruymbeke,...
, a judge in Paris, entitled "The 'black boxes' of financial globalization," is that:
"The chaos of financial flux is only an appearance. Of course, offshore banks and tax havenTax havenA tax haven is a state or a country or territory where certain taxes are levied at a low rate or not at all while offering due process, good governance and a low corruption rate....
s perfectly hide the points of arrival and of transit of dirty capitalCapital (economics)In economics, capital, capital goods, or real capital refers to already-produced durable goods used in production of goods or services. The capital goods are not significantly consumed, though they may depreciate in the production process...
. It is even their reason of existence (raison d'être). Trying to find the illegal money flux in those offshore centers is hopelessly doomed... However, since capital from criminal origin pass in the same financial 'pipes' as other ones [legal funds], i.e. clearing and financial routage companies, they become vulnerable precisely during their transfer [in those clearing companies]."
In other words, all financial money flows, legal or illegal, have to pass through the financial system.
A "black box" of Cedel
Ernest Backes also explained that a company named Cedel International, located in GenevaGeneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...
, had been inscribed in the Swiss register of commerce but not included in the books of the mother company, Cedel International in Luxembourg. "This non-consolidated 'branch,' whose president is Robert Douglass of New York, former private secretary of Governor Nelson Rockefeller
Nelson Rockefeller
Nelson Aldrich Rockefeller was the 41st Vice President of the United States , serving under President Gerald Ford, and the 49th Governor of New York , as well as serving the Roosevelt, Truman and Eisenhower administrations in a variety of positions...
, and vice chairman of the Chase Manhattan Corporation (now J.P. Morgan Chase), apparently had not raised too many questions for Swiss federal magistrates." Backes qualified this "black box" as "institutionalized tax evasion at highest level in world finance,", noting that tax evasion was even "more or less expressed in the objectives of the company as filed in the Swiss register of commerce." The "branch" has since "been resold to another Luxembourg holding company, with the people in the backyard remaining mostly the same."
March 2000 French parliamentary report
In March 2000, a parliamentary report by French deputies Arnaud MontebourgArnaud Montebourg
Arnaud Montebourg is a French politician, and a deputy of the fifth district of Saône-et-Loire to the French National Assembly for the Socialist Party. He has also been elected president of the local assembly of Saône et Loire after local elections in 2008...
and Vincent Peillon
Vincent Peillon
Vincent Benoît Camille Peillon is a French politician and Member of the European Parliament for the north-west of France...
, entitled "Parliamentary Report on the obstacles on the control and repression of financial criminal activity and of money-laundering in Europe," dedicated its whole third section to "Luxembourg's political dependency toward the financial sector: the Clearstream affair."
Judicial investigations and libel lawsuits
Following the publication of "Revelation$," the tribunalTribunal
A tribunal in the general sense is any person or institution with the authority to judge, adjudicate on, or determine claims or disputes—whether or not it is called a tribunal in its title....
of Luxembourg opened up an investigation on February 26, 2001. On November 30, 2004, the parquet finally declared no proof of "systematic manipulations" had been found, and that investigations would continue on suspicion of manipulation and tax evasion
Tax evasion
Tax evasion is the general term for efforts by individuals, corporations, trusts and other entities to evade taxes by illegal means. Tax evasion usually entails taxpayers deliberately misrepresenting or concealing the true state of their affairs to the tax authorities to reduce their tax liability,...
regarding former Clearstream CEO André lussi. This also led to a non lieu (Statement from the Luxembourg Parquet, November 2004).
Denis Robert also has been sued for defamation by other banks and companies incriminated by the book: 50+ different cases — among which Bank Menatep
Bank Menatep
Bank Menatep was a US$29 billion holding company created by Mikhail Khodorkovsky, that had indirect controlling interest in Yukos Oil Company. It was involved in the US$4.8 billion diversion of International Monetary Fund funds.-Scandal:...
, Banque Générale du Luxembourg, etc., in which the author and his editor Laurent Beccaria were acquitted in all but two cases, and damages for both cases of one Euro were awarded. On January 27, 2006, once more Denis Robert was charged by a Luxembourg committing magistrate
Magistrate
A magistrate is an officer of the state; in modern usage the term usually refers to a judge or prosecutor. This was not always the case; in ancient Rome, a magistratus was one of the highest government officers and possessed both judicial and executive powers. Today, in common law systems, a...
for defamation, slander, and insults.
A complaint was opened in March 2001 against Ernest Backes, and Denis Robert was included in it five years later: "I am very surprised of this accusation five years after the facts and of the energy which the Luxembourgian justice puts continuing to harass me while it was not at the end of the inquiry opened for money laundering, tax evasion and corruption against Clearstream", Robert said. An organization, "Freedom to inform," declared to Le Nouvel Observateur
Le Nouvel Observateur
Le Nouvel Observateur is a weekly French newsmagazine. Based in Paris, it is the most prominent French general information magazine in terms of audience and circulation ....
magazine that "By transforming the affair Robert in affair Frieden
Luc Frieden
Luc Frieden is a Luxembourgian politician for the Christian Social People's Party . He was Minister for Justice and Minister for the Treasury and Budget from 1998 to 2009, and has been Minister for Finances since 23 July 2009.In the capacity of Minister for the Treasury and Budget, Frieden was...
(Luxembourg Minister of Justice, of the Treasury and the Budget), every signature will be a civil act which protects the freedom of the media in Europe."
Suspension & investigation of Clearstream's CEO
On May 15, 2001, André Lussi was suspended from his CEOChief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
position at Clearstream, and on December 31, 2001, he departed the company on mutual agreement. In February 2004 an investigation was opened against him, on money laundering, fraud, and tax evasion charges. André Lussi was replaced by André Roelants, who had been at Dexia
Dexia
Dexia N.V./S.A., also referred to as the Dexia Group, is a Belgian-French financial institution active in public finance, providing retail and commercial banking services to individuals and SMEs, asset management, and insurance...
. After years of investigations, all allegations made against André Lussi turned out to be completely causeless and the lawsuits were abandoned by the courts.
Refusal of the European Commission to open an investigation: 20 Minutes ' revelations
Along with Ernest Backes, Denis Robert presented Revelation$ to the Capital Tax, Fiscal Systems and Globalization intergroup of the European ParliamentEuropean Parliament
The European Parliament is the directly elected parliamentary institution of the European Union . Together with the Council of the European Union and the Commission, it exercises the legislative function of the EU and it has been described as one of the most powerful legislatures in the world...
in March 2001 and also to the French National Assembly
French National Assembly
The French National Assembly is the lower house of the bicameral Parliament of France under the Fifth Republic. The upper house is the Senate ....
. Answering the question raised by European MPs (MEP) Harlem Désir
Harlem Désir
Harlem Désir is a French politician and Member of the European Parliament for the Île-de-France since 1999. He is a member of the Socialist Party, part of the Party of European Socialists....
, Glyn Ford
Glyn Ford
Glyn Ford was a member of the European Parliament initially for Greater Manchester East, until 1999 and then South West England for the Labour Party and Gibraltar Socialist Labour Party....
and Francis Wurtz
Francis Wurtz
Francis Wurtz was a French Member of the European Parliament from 1979 till 2009. Elected in the Île-de-France constituency on the French Communist Party ticket, he sits with the European United Left - Nordic Green Left group, and is its current President...
, who asked the Commission to investigate the accusations made by the book and to ensure that the 10 June 1990 directive (91/308 EC) on control of financial establishment be applied in all member states in an effective way, Commissioner Frits Bolkestein
Frits Bolkestein
Frederik "Frits" Bolkestein is a retired Dutch politician of the People's Party for Freedom and Democracy . He served as a Member of the House of Representatives from 16 January 1978, until 5 November 1982, when he became State Secretary for Economic Affairs from 5 November 1982, until 14 July...
observed that "the Commission has no reason to date to believe that the Luxembourg authorities do not apply it vigorously".
On April 26, 2006, 20 Minutes
20 minutes
20 minutes may refer to:*20 minutes *20 minutes *20 minutos, Spanish newspaper...
revealed that "in May 2005, MEP Paul Van Buitenen was shocked by Frits Bolkestein's presence on Menatep
Bank Menatep
Bank Menatep was a US$29 billion holding company created by Mikhail Khodorkovsky, that had indirect controlling interest in Yukos Oil Company. It was involved in the US$4.8 billion diversion of International Monetary Fund funds.-Scandal:...
's international consultative council, a Russian banking establishment, and by his work for Shell
Royal Dutch Shell
Royal Dutch Shell plc , commonly known as Shell, is a global oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the fifth-largest company in the world according to a composite measure by Forbes magazine and one of the six...
, a British-Dutch petrol company, two firms 'maintaining secret accounts in Clearstream'... Van Buitenen, also Dutch, then asked for 'clarification' to the European Commission and the opening of a parliamentary investigation. The Commission's president, José Manuel Barroso, replied that these facts 'do not bring up any new question' and that it is not known 'if Menatep made contact with Bolkestein while he was in these positions'. No investigation therefore took place."
The free daily points out that "in 2001, it was Bolkestein himself who announced the Commission's refusal to open up a parliamentary investigation on Clearstream", following Harlem Désir's requests and accusations that Menatep had an "undeclared account" at Clearstream. Bolkestein refused to answer any questions by the newspaper, which recalls that Van Buitenen, former European public servant, had already revealed a vast corruption affair in 1999, which led to the resignation of the Commission presided by Jacques Santer (who has also been prime minister of Luxembourg) and the fall of Edith Cresson
Édith Cresson
Édith Cresson is a French politician. She was the first and so far only woman to have held the office of Prime Minister of France.- French Prime Minister :Cresson was appointed to the prime ministerial post by President François Mitterrand on 15 May 1991...
.
Furthermore, two Belgian Senators, Isabelle Durant
Isabelle Durant
Isabelle A.J. Durant is a Belgian politician, member of the Ecolo party. On 15 September, 2010 Durant supported the new initiative Spinelli Group in the European Parliament, which was founded to reinvigorate the strive for federalisation of the European Union...
and Jean Cornil, proposed a law in vain in 2004 to create a national investigation commission charged with the investigation of the use of accounts in "clearing and routing firms" to commit fiscal frauds (tax evasion) and/or money-laundering.
Clearstream's reply
In April 2006, while the second "Clearstream affair" was beginning to make French media headlines (See below), Clearstream filed a lawsuitLawsuit
A lawsuit or "suit in law" is a civil action brought in a court of law in which a plaintiff, a party who claims to have incurred loss as a result of a defendant's actions, demands a legal or equitable remedy. The defendant is required to respond to the plaintiff's complaint...
against "John Doe," targeting this time the anonymous denunciations claiming that Nicolas Sarkozy and other French political personalities had secret accounts at Clearstream, which would have been used for hypothetical kickbacks. Former French Prime Minister Dominique de Villepin
Dominique de Villepin
Dominique Marie François René Galouzeau de Villepin is a French politician who served as the Prime Minister of France from 31 May 2005 to 17 May 2007....
came under investigation for what may have been his involvement in spreading the false charges against the current French President Sarkozy, but was later acquitted in January 2010, although three of his co-defendants were found guilty.
Furthermore it answered questions of 20 Minutes
20 Minuten
20 Minuten is a free German language daily newspaper in Switzerland, distributed to commuters at over 150 train stations across the country.The newspaper was first published in 1999 by "20 Minuten Schweiz AG"...
in an interview, denying knowing anything about the various attempts to create European-level investigations commissions about its internal workings. It also denied "the existence of parallel accounts" and of "personal accounts" (in response, Denis Robert published a list of several personal accounts on his blog). However, the company did recognize that "a banking establishment may request an unpublished account, that is, an account only known by the establishments concerned by the transaction, control authorities, and the auditors of the firm". Clearstream also indicated that it had "spent 15 million euros on various audits without finding anything," Denis Robert's accusations.
Nadhmi Auchi, largest private share-holder of BNP Paribas bank
IraqIraq
Iraq ; officially the Republic of Iraq is a country in Western Asia spanning most of the northwestern end of the Zagros mountain range, the eastern part of the Syrian Desert and the northern part of the Arabian Desert....
i-born Nadhmi Auchi
Nadhmi Auchi
Nadhmi Shakir Auchi, , is a British Iraqi businessman and billionaire, founding president of the Anglo Arab Organisation, and the founder and chairman of General Mediterranean Holding , a conglomerate of 120 companies worldwide...
, # 34 on the "Sunday Times Rich List 2004" (# 22 on the same list in 2005) and 13th richest man in Britain according to The Guardian
The Guardian
The Guardian, formerly known as The Manchester Guardian , is a British national daily newspaper in the Berliner format...
, estimated to be worth $1 billion according to Forbes
Forbes
Forbes is an American publishing and media company. Its flagship publication, the Forbes magazine, is published biweekly. Its primary competitors in the national business magazine category are Fortune, which is also published biweekly, and Business Week...
, also appeared to be a key figure.
Auchi was convicted of profiteering
Profiteering
Profiteering may relate to:* Profiteering * War profiteering...
by the Paris Criminal Court, and received a 15-month suspended sentence
Suspended sentence
A suspended sentence is a legal term for a judge's delaying of a defendant's serving of a sentence after they have been found guilty, in order to allow the defendant to perform a period of probation...
, for his involvement in Elf's scandal, "the biggest fraud inquiry in Europe since the Second World War. Elf became a private bank for its executives who spent £200 million on political favours, mistresses, jewellery, fine art, villas and apartments". The "Guardian" noted that Nadhmi Auchi had helped Orascom (which owns Djezzy GSM
Djezzy GSM
Djezzy GSM, a branch of the Algeria-based Orascom Telecom, is Algeria's principal mobile network operator, with a market share of 65% and a network covering 84% of the population It acquired the country's second GSM license in July 2001, with a bid of $737 million, and was officially launched on...
), owned by Onsi Sawiris
Onsi Sawiris
Onsi Sawiris is an Egyptian businessman. He was estimated to be worth approximatively $2.9 billion according to Forbes in 2011. He is the patriarchal head of the Sawiris Family...
(worth $5.2 billion with his family according to Forbes), gain a contract to set up mobile phone networks in post-Saddam's
Saddam Hussein
Saddam Hussein Abd al-Majid al-Tikriti was the fifth President of Iraq, serving in this capacity from 16 July 1979 until 9 April 2003...
Iraq. As owner of the General Mediterranean Holdings
General Mediterranean Holdings
The General Mediterranean Holding is a financial holding company established in 1979 in Luxembourg City, in southern Luxembourg, founded by Anglo-Iraqi businessman Nadhmi Auchi....
, Auchi is the largest private shareholder of BNP Paribas
BNP Paribas
BNP Paribas S.A. is a global banking group, headquartered in Paris, with its second global headquarters in London. In October 2010 BNP Paribas was ranked by Bloomberg and Forbes as the largest bank and largest company in the world by assets with over $3.1 trillion. It was formed through the merger...
, which until 2001 managed the escrow
Escrow
An escrow is:* an arrangement made under contractual provisions between transacting parties, whereby an independent trusted third party receives and disburses money and/or documents for the transacting parties, with the timing of such disbursement by the third party dependent on the fulfillment of...
account through which the money from the Oil-for-Food programme
Oil-for-Food Programme
The Oil-for-Food Programme , established by the United Nations in 1995 was established with the stated intent to allow Iraq to sell oil on the world market in exchange for food, medicine, and other humanitarian needs for ordinary Iraqi citizens without allowing Iraq to boost its military...
transited.
Bank Menatep
Bank Menatep, owned by Mikhail KhodorkovskyMikhail Khodorkovsky
Mikhail Borisovich Khodorkovsky is a Russian prisoner, considered by some - such as Amnesty International - to have been imprisoned for political reasons, jailed until 2016 and a former Russian oligarch and businessman...
, was involved in the "Kremlingate", when $4.8 billion in International Monetary Fund
International Monetary Fund
The International Monetary Fund is an organization of 187 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world...
funds were diverted to various banks, including US banks. It opened up its non-published Cedel account #81 738 on May 15, 1997. "Menatep further violated the rules because many transfers were of cash, not for settlement of securities", writes Komisar. "For the three months in 1997 for which I hold microfiches, Backes says, only cash transfers were transferred through the Meanatep account. There were a lot of transfers between Menatep and the Bank of New York
Bank of New York
The Bank of New York was a global financial services company established in 1784 by the American Founding Father Alexander Hamilton. It existed until its merger with the Mellon Financial Corporation on July 2, 2007...
." Natasha Gurfinkel Kagalovsky, a former Bank of New York official and the wife of a Menatep vice-president, was accused of helping launder at least $7 billion from Russia, according to Komisar. US investigators have attempted to find out if some of the laundered money originated with Menatep.
On November 26, 2003, Backes and another ex-banker, Swiss citizen André Strebel, filed a criminal complaint with the Swiss attorney general against Khodorkovsky and his colleagues Platon Lebedev
Platon Lebedev
Platon Leonidovich Lebedev is a former CEO of Group Menatep, currently imprisoned in Russia, and is best known as a close associate of Mikhail Khodorkovsky.-Conviction:...
and Alexei Golubovich, accusing them of money-laundering and supporting a criminal organization. They requested an investigation and a search of records of the Swiss office of Menatep SA, Menatep Finances SA, Valmet
Valmet
' was a Finnish state-owned conglomerate. Valmet was formed in 1951, when the state of Finland decided to group their various factories working on war reparations to the Soviet Union under one company...
. and of Bank Leu
Bank Leu
Bank Leu AG was a Swiss private bank that existed from 1755 to 2007. Headquartered in Zurich, it was a subsidiary of Credit Suisse from 1990. In 2007, it was merged with that company's other private banking units as Clariden Leu. At the time, it was the oldest bank in Switzerland.The bank was...
in Geneva
Geneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...
, related to claims of fraud
Fraud
In criminal law, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation...
against the Russian company Avisma and money-laundering by Menatep in Switzerland. According to this complaint, Bank Menatep has been linked since its creation to the Russian oligarchy and criminal organizations, such as Khodorkovsky, Alexander Konanykhine and the Russian godfather
Russian Mafia
The Russian Mafia is a name applied to organized crime syndicates in Russia and Ukraine. The mafia in various countries take the name of the country, as for example the Ukrainian mafia....
Semion Mogilevich
Semion Mogilevich
Semion Yudkovich Mogilevich is a Ukrainian-born organized crime boss, believed by European and United States federal law enforcement agencies to be the "boss of bosses" of most Russian Mafia syndicates in the world...
. "Even though Menatep officially failed in 1998, it oddly remained on the non-published list of Clearstream accounts for 2000", wrote Komisar. Clearstream's listings also present 36 other Russian accounts, most non-published.
In April 2006, Clearstream declared, to the French edition of 20 Minutes
20 Minuten
20 Minuten is a free German language daily newspaper in Switzerland, distributed to commuters at over 150 train stations across the country.The newspaper was first published in 1999 by "20 Minuten Schweiz AG"...
, that if "Menatep may have strange accounts, it wasn't closed because of money-laundering". It also claimed that it dealt with "banks accredited in their country of origin", but not with "establishments that are registered on the Financial Action Task Force on Money Laundering
Financial Action Task Force on Money Laundering
The Financial Action Task Force , also known by its French name, Groupe d'action financière , is an intergovernmental organization founded in 1989 on the initiative of the G7. The purpose of the FATF is to develop policies to combat money laundering and terrorist financing...
's black list".
The Second Clearstream Affair
The Second Clearstream affair began in July 2004, when anonymous denunciations sent to magistrate Renaud Van RuymbekeRenaud Van Ruymbeke
Renaud van Ruymbeke is a French investigative magistrate, well known for specializing in political and financial corruption cases, who investigated on the French-Taiwan frigates Affair, which has been related to the Clearstream scandal, and on the Urba affair.- Bibliography :*Renaud van Ruymbeke,...
accused various important French political figures of having received kickbacks related to the Taiwan frigates scandal, through secret personal accounts at Clearstream. Clearstream was again pointed out as having been a major platform for illegal financial transactions. After thorough investigation including search in Clearstream's archives and accounts, M Van Ruymbecke found absolutely no evidence of the validity of the allegations and closed the case.
After an investigation by judges On September 3, 2004, the Paris parquet (public prosecutor) opened an investigation into charges of "defamation", following a complaint by Philippe Delmas, EADS' vice-president. Magistrates Jean-Marie d'Huy and Henri Pons have charged Dominique de Villepin, former French PM, Jean-Louis Gergorin
Jean-Louis Gergorin
Jean-Louis Gergorin is a former French diplomat and former executive vice president of EADS – the giant European aerospace company that controls Airbus. He is also the whistleblower of the Clearstream Affair; a money laundering scandal that has garnered international attention and disturbed the...
, former EADS executive who confessed having been the poison pen in the case, Imad Lahoud, Florian bourges and Denis Robert. Their trial started on 21 September 2009.
Investigation of the anonymous denunciations
On May 3, 2004 and June 14, 2004, Renaud Van RuymbekeRenaud Van Ruymbeke
Renaud van Ruymbeke is a French investigative magistrate, well known for specializing in political and financial corruption cases, who investigated on the French-Taiwan frigates Affair, which has been related to the Clearstream scandal, and on the Urba affair.- Bibliography :*Renaud van Ruymbeke,...
and Dominique Talancé, the French magistrates in charge of the Taiwan frigates scandal, received two letters and a CD-ROM from an anonymous informant (called corbeau in French), detailing numbered bank account
Numbered bank account
A numbered bank account is a type of bank account where the name of the account holder is kept secret, and he identifies himself to the bank by means of a code word known only by the account holder and a restricted number of bank employees, thus providing the holder with a degree of bank privacy in...
s maintained at Clearstream and describing secret transfers of millions of dollars. Many personalities were named, including Alain Gomez, former director of Thomson-CSF
Thomson-CSF
Thomson-CSF was a major electronics and defence contractor. In December 2000 it was renamed Thales Group.-History:In 1879 Elihu Thomson and Edwin Houston formed the Thomson-Houston Electric Company in the United States....
(which since has become Thales
Thales
Thales of Miletus was a pre-Socratic Greek philosopher from Miletus in Asia Minor, and one of the Seven Sages of Greece. Many, most notably Aristotle, regard him as the first philosopher in the Greek tradition...
), Andrew Wang, the Taiwanese intermediary of the frigates contract and one of Taiwan's key figures concerning arms contracts, Philippe Delmas, vice-president of EADS
EADS
The European Aeronautic Defence and Space Company N.V. is a global pan-European aerospace and defence corporation and a leading defence and military contractor worldwide...
the European aeronautics consortium, and Nicolas Sarkozy
Nicolas Sarkozy
Nicolas Sarkozy is the 23rd and current President of the French Republic and ex officio Co-Prince of Andorra. He assumed the office on 16 May 2007 after defeating the Socialist Party candidate Ségolène Royal 10 days earlier....
, then minister of the Economy, Dominique Strauss-Kahn
Dominique Strauss-Kahn
Dominique Gaston André Strauss-Kahn , often referred to in the media, and by himself, as DSK, is a French economist, lawyer, politician, and member of the French Socialist Party...
, Jean-Pierre Chevènement
Jean-Pierre Chevènement
Jean-Pierre Chevènement is a French politician. He was Minister of Defense from 1988 to 1991 and Minister of the Interior from 1997 to 2000. He was a presidential candidate in 2002 and since 2008 has been a member of the Senate....
, and others. Members of the French secret services also were named.
Magistrate Van Ruymbeke opened another investigation, in July 2004. According to the denunciations, Andrew Wang passed on money to several very important French officials from 1999 to 2003, using Clearstream.
But in January 2006, both magistrates declared the case closed, on the grounds that the corbeau 's list of Clearstream accounts owned by various political figures was a fraud. For example, the numbered Banca popolare di Sondrio Clearstream account, supposedly in the names of "Stéphane Bocsa" and "Paul de Nagy" — French president, Nicolas Sarkozy
Nicolas Sarkozy
Nicolas Sarkozy is the 23rd and current President of the French Republic and ex officio Co-Prince of Andorra. He assumed the office on 16 May 2007 after defeating the Socialist Party candidate Ségolène Royal 10 days earlier....
's full name is "Nicolas Paul Stéphane Sarkozy de Nagy-Bocsa" — was not Sarkozy's personal account, but an account used by various persons, according to the declarations of the Banca popolare di Sondrio to Judge Ruymbeke.
Lawsuits alleging defamation
In December 2005, magistrate Van Ruymbeke, in charge of the Taiwan frigates Affair, showed that the listings had been fraudulently modified to accuse French political luminaries.Searches in 2007
French magistrates sought to search the Canard enchaînéLe Canard enchaîné
Le Canard enchaîné is a satirical newspaper published weekly in France. Founded in 1915, it features investigative journalism and leaks from sources inside the French government, the French political world and the French business world, as well as many jokes and humorous cartoons.-Early...
s offices in May 2007, after the election of Nicolas Sarkozy to the presidency
French presidential election, 2007
The 2007 French presidential election, the ninth of the Fifth French Republic was held to elect the successor to Jacques Chirac as president of France for a five-year term.The winner, decided on 5 and 6 May 2007, was Nicolas Sarkozy...
. According to editing director Claude Angeli, the judges were looking for information on a "Rondot document" treating of alleged "Japanese accounts" of former President Jacques Chirac
Jacques Chirac
Jacques René Chirac is a French politician who served as President of France from 1995 to 2007. He previously served as Prime Minister of France from 1974 to 1976 and from 1986 to 1988 , and as Mayor of Paris from 1977 to 1995.After completing his studies of the DEA's degree at the...
. The judges were not allowed access to the newspaper's offices, and Reporters Without Borders
Reporters Without Borders
Reporters Without Borders is a France-based international non-governmental organization that advocates freedom of the press. It was founded in 1985, by Robert Ménard, Rony Brauman and the journalist Jean-Claude Guillebaud. Jean-François Julliard has served as Secretary General since 2008...
(RSF) protested against the search.
The October surprise conspiracy
Ernest Backes also indicated in Révélation$ that he was in charge of the transfer of $7 million from Chase Manhattan BankChase Manhattan Bank
JPMorgan Chase Bank, N.A., doing business as Chase, is a national bank that constitutes the consumer and commercial banking subsidiary of financial services firm JPMorgan Chase. The bank was known as Chase Manhattan Bank until it merged with J.P. Morgan & Co. in 2000...
and Citibank
Citibank
Citibank, a major international bank, is the consumer banking arm of financial services giant Citigroup. Citibank was founded in 1812 as the City Bank of New York, later First National City Bank of New York...
, on January 16, 1980, to pay for the liberation of the American hostages held in Tehran's embassy (Iran). He gave copies of files that he asserted shed new light on the October surprise conspiracy to the French National Assembly
French National Assembly
The French National Assembly is the lower house of the bicameral Parliament of France under the Fifth Republic. The upper house is the Senate ....
.
Banks with accounts in Clearstream
- Bank of Credit and Commerce InternationalBank of Credit and Commerce InternationalThe Bank of Credit and Commerce International was a major international bank founded in 1972 by Agha Hasan Abedi, a Pakistani financier. The Bank was registered in Luxembourg with head offices in Karachi and London. Within a decade BCCI touched its peak...
, which, although officially closed in July 1991, continued to operate via Clearstream through unpublished accounts — as did Bank MenatepBank MenatepBank Menatep was a US$29 billion holding company created by Mikhail Khodorkovsky, that had indirect controlling interest in Yukos Oil Company. It was involved in the US$4.8 billion diversion of International Monetary Fund funds.-Scandal:...
, involved in the "Kremlingate" (diversion of IMF funds), and owned by Mikhail KhodorkovskyMikhail KhodorkovskyMikhail Borisovich Khodorkovsky is a Russian prisoner, considered by some - such as Amnesty International - to have been imprisoned for political reasons, jailed until 2016 and a former Russian oligarch and businessman... - Banque Générale du Luxembourg
- Carlyle GroupCarlyle GroupThe Carlyle Group is an American-based global asset management firm, specializing in private equity, based in Washington, D.C. The Carlyle Group operates in four business areas: corporate private equity, real assets, market strategies and fund-of-funds, through its AlpInvest subsidiary...
- Crédit LyonnaisCrédit LyonnaisCrédit Lyonnais is a historic French bank. In the early 1990s it was the largest French bank, majority state-owned at that point. Crédit Lyonnais was the subject of poor management during that period which almost led to its bankruptcy in 1993...
, one of France's major financial crashes during the 1990s - Société GénéraleSociété GénéraleSociété Générale S.A. is a large European Bank and a major Financial Services company that has a substantial global presence. Its registered office is on Boulevard Haussmann in the 9th arrondissement of Paris, while its head office is in the Tours Société Générale in the business district of La...
- Banco AmbrosianoBanco AmbrosianoBanco Ambrosiano was an Italian bank which collapsed in 1982. At the centre of the bank's failure was its chairman, Roberto Calvi and his membership in the illegal Masonic Lodge Propaganda Due...
, controlled by the Vatican BankVatican BankThe Institute for Works of Religion , commonly known as the Vatican Bank, is a privately held institute located inside Vatican City run by a professional bank CEO who reports directly to a committee of cardinals, and ultimately to the Pope...
and involved in one of Italy's major financial and political scandals - SiemensSiemensSiemens may refer toSiemens, a German family name carried by generations of telecommunications industrialists, including:* Werner von Siemens , inventor, founder of Siemens AG...
(Published Accounts by Lucy KomisarLucy KomisarLucy Komisar is a New York City-based investigative journalist. She writes about offshore banking, corporate secrecy, international money laundering, and how they relate to corporate fraud; international corruption; the looting by dictators; financing of terrorism; international crime including...
) - More than 38,000 others; as Clearstream is an international clearing and settlement organization, most member companies and banks have published accounts. Dealing with Clearstream is entirely legal; accounts used for tax evasion or money laundering is not.
Iranian Funds Controversy
Clearstream is allegedly holding $2 billion in IranIran
Iran , officially the Islamic Republic of Iran , is a country in Southern and Western Asia. The name "Iran" has been in use natively since the Sassanian era and came into use internationally in 1935, before which the country was known to the Western world as Persia...
ian funds in a Citibank
Citibank
Citibank, a major international bank, is the consumer banking arm of financial services giant Citigroup. Citibank was founded in 1812 as the City Bank of New York, later First National City Bank of New York...
account. Since 2008, these funds have been ordered frozen by the U.S. District Court for the Southern District of New York, and are intended for use to pay the families of hundreds of US Marines killed and injured in a 1983 Beirut
Beirut
Beirut is the capital and largest city of Lebanon, with a population ranging from 1 million to more than 2 million . Located on a peninsula at the midpoint of Lebanon's Mediterranean coastline, it serves as the country's largest and main seaport, and also forms the Beirut Metropolitan...
bombing that a US federal judge ruled was orchestrated by Iran
Iran
Iran , officially the Islamic Republic of Iran , is a country in Southern and Western Asia. The name "Iran" has been in use natively since the Sassanian era and came into use internationally in 1935, before which the country was known to the Western world as Persia...
, according to the Wall Street Journal.
See also
- Argentine debt restructuringArgentine debt restructuringArgentina went through an economic crisis beginning in the mid-1990s, with full recession between 1999 and 2002; though it is debatable whether this crisis has ended, the situation has been more stable, and improving, since 2003....
- ATTAC
- Banco AmbrosianoBanco AmbrosianoBanco Ambrosiano was an Italian bank which collapsed in 1982. At the centre of the bank's failure was its chairman, Roberto Calvi and his membership in the illegal Masonic Lodge Propaganda Due...
scandal - Kremlingate
- Underground economyUnderground economyA black market or underground economy is a market in goods or services which operates outside the formal one supported by established state power. Typically the totality of such activity is referred to with the definite article as a complement to the official economies, by market for such goods and...