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France uncovers 'massive fraud' of coronavirus wage payouts

The French government has paid around 84% of net salary for people unable to work due to the pandemic.

Image: Shutterstock/Vladyslav Starozhylov

THE PARIS PROSECUTOR’S office said Friday that it was investigating “massive fraud” across France by people falsely claiming temporary wage assistance for employees laid off during the coronavirus lockdown.

As the crisis hit, the French government quickly introduced a system to pay around 84% of net salary for people no longer able to work.

Thousands of firms applied for the payments, allowing millions of people to avoid a sudden drop in revenue – in the first month alone the programme paid out some €24 billion.

But officials soon began noticing suspicious similarities in some applications, in many cases by people who surreptitiously used the tax registration numbers of firms that had not applied for the funds.

“More than 1,740 fraudulent operations were discovered across the country on behalf of 1,069 different businesses asking for wire transfers to over 170 different bank accounts,” Paris Prosecutor Remy Heitz said in a statement.

It said €1.7 million was illicitly paid out, but officials managed to suspend other payments totalling more than €6 million.

In the southern Occitanie region alone, investigators tracked 18 fraudulent transfers totalling €868,000 to French bank accounts, of which €421,000 have been recovered.

“Several other investigations, aimed at uncovering international financial movements linked to these frauds, still need to be carried out,” Heitz said.

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“They will be extremely complex and require significant international cooperation.”

Despite the relief programme, the French government has warned that up to 800,000 jobs could be lost in coming months because of the two months of business closures during the Covid-19 lockdown, which began to be lifted in May.

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