Arafat's wife blames Sharon for laundering controversy

Yasser Arafat’s wife today accused Israeli Prime Minister Ariel Sharon of being behind reports of a probe by French prosecutors into alleged transfers of millions of pounds to her Paris bank accounts.

The preliminary probe, opened by the Paris prosecutor’s office in October, is looking into more than €8m allegedly transferred to Suha Arafat’s accounts at the Arab Bank and at French bank BNP between July 2002 and September 2003, French judicial officials have said.

From her Paris home the Palestinian first lady told the London-based Al-Hayat newspaper that Sharon was spreading “the malevolent press leaks” to cover up a bribery scandal that could force him out of office.

Sharon has denied wrongdoing, and has told investigators he did not know of a lucrative marketing contract his son Gilad signed with a property developer despite apparent lack of experience needed for the job, according to Israeli press reports.

“The predicament that Sharon and his sons are in resulting from investigations into corruption charges is behind such fabricated press reports that are entirely baseless,” Arafat told the paper,.

“Sharon is trying to fabricate similar scandals (involving) the Arafat family to cover up his scandals,” she added, according to Al-Hayat.

Arafat said she has not been summoned for questioning by the French prosecutor, a French court or any bank, according to Al-Hayat. Arafat told the newspaper she first learned of the probe from press reports.

“As long as there is a Palestinian-Israeli conflict, Sharon and the Israelis will not stop vilifying President Arafat and his family,” Arafat told the newspaper.

“They are trying to efface the Palestinian cause and kill Palestinian children, men and women.”

Arafat told Al-Hayat that the money she receives is sent to her and spent legally.

She did not specify the amount of money she has received nor did she reveal the amount that is under investigation.

“What’s strange about the Palestinian president sending any amount of money to his family and his wife who cares for Palestinian interests abroad?” Arafat said in the interview.

“All this money has come, and is coming, in a legal way and the way it’s spent is legal,” she added.

“My husband and I are ready to respond to any questioning regarding the source of this money and they way it was spent.”

French officials have stressed that the probe is only in its preliminary stages and that police are not involved.

Nor has a full investigation been ordered, since the probe has not determined that the alleged funds came from illicit sources – a necessity if prosecutors are to file any charges of money laundering, French officials have said.

The probe originated from a Bank of France inspection of the Arab Bank. The Bank of France found that cash was allegedly transferred from Switzerland to Mrs Arafat’s accounts in Paris, French judicial officials have said.

The Bank of France alerted the watchdog Banking Commission, which in turn alerted the Paris prosecutor’s office last September, according to those officials.

They said that Tracfin, a government organisation that collates information about money laundering, confirmed the Bank of France’s suspicions about the alleged transfers.