“The amount of Russian assets frozen in France amounts to 1.2 billion euros”, Guillaume Valette-Valla (Tracfin)

LA TRIBUNE – What are the main lessons of Tracfin’s latest activity report, just unveiled?

WILLIAM VALETTE-VALLA – In 2021 the service activity remained at high levels. This activity is illustrated by the collection of data, in particular the reports of suspicious transactions by professionals subject to due diligence obligations in the fight against money laundering and terrorist financing. The number of information received by the service increased by almost 50% between 2020 and 2021. The number of notes produced by Tracfin for its partners increased by almost 10% in 2021.

Tracfin’s partner landscape is broad and reflects the scope of the department’s missions. Our notes are addressed to the judiciary but also to the administrations responsible for the fight against fraud, to foreign financial intelligence units and to our partners in the intelligence community. Our three priority missions are the fight against economic and financial crime, the fight against fraud in public finances, the intelligence that contributes to the national security strategy and the defense of the fundamental interests of the nation.

Tracfin has been called up for other roles in recent years. How has your workforce evolved?

Tracfin has a staff of 200 people, the number of agents has increased by 65% ​​since 2017, the number of information received has doubled in the same period. We have seen very strong growth over the past few years. Some events such as the Covid crisis and fraud in economic support regimes or the war between Russia and Ukraine have contributed to the increase in demand for our services.

In your last report, you indicate the multiple frauds in the personal training account (CPF). How are they characterized?

These fraud patterns have evolved over time. The CPF frauds were committed by petty scammers in 2020 and early 2021. They were therefore fairly straightforward frauds. Some companies pretended to be training organizations when it was a scam. We have also seen a lot of identity theft. Since mid-2021, it is no longer the same types of fraud or the same types of scammers.

Currently, the practices handled by our services reveal a much greater complexity thanks to the shell companies that are born and disappear shortly after receiving public funds for training. The department’s cooperation with our foreign counterparts is essential for monitoring international financial flows and guarantees the effectiveness of the mechanism to combat such fraud.

Since the start of the pandemic, numerous aid has been implemented to support the economy (partial unemployment, solidarity funds, state-guaranteed loans). What is the extent of the fraud on all these devices?

Tracfin cannot know the full extent of the fraud. We only see part of the fraud. The estimate of the total amount of fraud corresponds to an “obscure figure”. This is a number that cannot be calculated precisely. It is primarily an evaluation.

Contrary to what one might think at the start of the pandemic, fraud in first aid devices was limited. The various works of the Court of Auditors have shown that this fraud has been limited. We have also seen more traditional fraud on energy savings certificates. These frauds rely on more structured networks reaching these devices to illegally capture taxpayers’ money. It is very difficult to have an accurate quantification of fraud. On the other hand, what can be said is that the easier it is to access a device, the more easily the scammer will hack into this device.

What methods did you use to identify them?

Regarding fraud related to emergency measures, we have informed Tracfin’s reporting professionals, such as banking institutions, or professionals in the non-financial sector of abnormal movements related, for example, to the creation and closure of fictitious companies. .

An organization has been set up within the state and public administrations with the DGFiP, the ASP (Agenzia Servizi e Pagamenti) and the Caisse des dépôts. This cooperation allowed for a rapid exchange of information between administrations to block aid payments to criminal organizations. On the CPF, several files have been sent to justice or are in the process of being judged.

Have you identified a fraud in the context of the recovery plan?

Yes, we have detected fraud in the context of state-guaranteed loans, for example. Such acts will be qualified as fraud only by the latest eligible repayment installments by the companies. However, deadlines will only be eligible in June 2024. In order for a breach to qualify as fraud, the company that benefited from the PGEs does not have to reimburse them. Other criteria must also be considered to qualify these bankruptcies as fraud.

Partial unemployment fraud: prison sentence for two scammers who stole several hundred thousand euros

In 2021, the Pandora Papers revealed once again the fraudulent practices of executives to evade taxes. Despite the proliferation of international investigations and the sophistication of investigative methods, tax evasion is still very much present. How do you explain this paradox?

Tracfin is not necessarily the administration best placed to address this phenomenon, unlike DGFiP. Today the phenomenon continues. There will always be a person, a malevolent organization that wants to cheat the law. However, the situation has changed dramatically over the past decade. The tools of the tax administration have clearly evolved. This allows for better dealing with fraud cases.

At the international level, the issues revolve around tax optimization and the reduction of tax evasion. The tax rates of some foreign companies in the new economy often challenge public opinion. It is more often about tax optimization than fraud. There is a lot of confusion between tax evasion and legal tax optimization. Thanks to Tracfin’s investigative resources and its network of overseas counterparties, it is possible to obtain important information and pass it on to the courts. Tax evasion remains a topic of interest for Tracfin but from the point of view of our services we cannot say that it is an explosive phenomenon.

Tax fraud: € 7.8 billion recovered from the tax authorities in 2020

After the outbreak of the war in Ukraine, on 1 March Bercy announced the establishment of a task force that brings together Tracfin, the Directorate General for Public Finance (DGFiP) and customs. What conclusions do you draw from these first months of action? What is the amount of frozen Russian assets?

The amount of frozen assets amounts to approximately 1.2 billion euros, excluding those of the Russian central bank. These are financial and non-financial assets. These blocks are based on a European regulation establishing a list of people adopted by Brussels. This mission mobilized Bercy’s services heavily during the first quarter of 2022.

The priority was to be able to provide data to our political authorities who defended proposals in Brussels on the basis of lists of assets held in France.

What is your job today?

Today our task is to verify that there is no risk of circumvention. When assets are frozen, an attempt is made to ascertain whether people are not attempting to evade the measures through family relays, relatives or tax optimization mechanisms.

Since May, Tracfin has returned to more normal activity. From the data collected, we try to see if we can not bring files to justice in the context of files on the laundering of illicit assets held in France, the laundering of illicit gains on the basis of acts of corruption. We are less looking for an administrative freeze but we are helping to fuel justice. Must be able to legally seize and confiscate illegally held assets. The persons indicated in this list drawn up by the European Union are not deprived of their assets.

In French law, they can only be by decision of a judge. This is to characterize criminal fraud. For example, let’s try to see if the property has been the subject of a crime or a punishable offense in France, in particular if it is tax evasion or if the property of a Russian oligarch has been the subject of international concealment or trafficking.

Interview by Grégoire Normand

In Bercy, the difficult hunt for Russian billionaires