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Ex-French finance minister in trouble over EADS probe

Former French finance minister Thierry Breton may not have revealed the whole picture last week in a probe into the massive insider trading scandal at Airbus parent company EADS, French daily Le Monde reported yesterday.

Breton was aware and even approved the purchase by the state-owned bank Caisse des Depots and Consignations (CDC) of European Aeronautic Defence and Space company shares owned by defense and media group Lagardere, Le Monde said, citing a CDC document it has obtained.

This purchase happened shortly before EADS subsidiary Airbus announced delays in its flagship A380 aircraft in June last year which led to a sharp fall in the EADS share price, prompting allegations of insider trading.

The document appears to contradict what Breton on Friday told a French Senate committee hearing on the scandal, saying he had not instructed CDC in buying EADS shares and that he had learned about the transaction via the press and was unhappy about it, Le Monde said.

"The state is beyond reproach in this affair" and "acted in an exemplary fashion," Breton had told the hearing.

But Le Monde says it has obtained the minutes from a supervisory board meeting of the CDC on July 12 last year which shows that Breton knew about the transaction and gave it the green light.

Interviewed by the paper, Breton said that on Friday he himself had "brought the minutes concerned to parliament's attention." He added that it was "a legal interpretation error."

Several top EADS executives and corporate shareholders -- Lagardere and Germany's DaimlerChrysler -- are suspected of illegally selling millions of euros in shares just before they announced major problems at the Airbus.

The French state is a major EADS shareholder with 15 percent, while a consortium of other investors including German regional governments holds 7.5 percent.

On Friday, French Finance Minister Christine Lagarde ordered an internal investigation into the action of the finance ministry's services as regards EADS between the end of 2005 and June last year.

The report will be submitted on Thursday to the finance minister and will be "made public immediately," the ministry said.
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