Paris dealers reel after €15m fraud

In an incident that put the new French money-laundering laws to the test for the first time with regard to the antiques trade, police raided the flat of the woman identified only as “Françoise H” before arriving at the chic Faubourg St-Honoré antiques district and seizing items from the premises of some of Paris’ best-known dealers.

Mademoiselle H, who is in her 40s, was an accountant in BNP-Paribas’ central offices and has admitted diverting large sums of money from the bank in order to finance her antiques spending. For three years she disguised her misappropriation of funds by transferring payments to antique dealers and then passing them off as invoices to the bank’s suppliers.

BNP lawyer Michel Beaussier hit out at the trade saying that its members are bound by “obligations of vigilance”. However, Christian Deydier, president of the French dealers’ association Syndicat National des Antiquaires, dismissed the affair as “an internal matter for BNP”.

He told ATG that the woman bought “perfectly legally from around 30 dealers”, who had no reason to suspect her. He also played down the whole situation as “a storm in a teacup”.

Monsieur Deydier accused BNP of trying to implicate dealers in order to deflect attention from their own shortcomings.

One St-Honoré dealer who shared this view said: “The true failure comes from the bank. We are being made into scapegoats.” He claimed the Parisian trade was “angry and perplexed” by the police’s attitude.

M. Deydier also pointed out that the new laws concerning money laundering apply only to foreign, not domestic, buyers, so that dealers had no reason to check the woman’s credentials.

Ms H. had become known as a big spender and in September 2004 was invited to the select reception at the Biennale des Antiquaires. She reportedly spent €8m at the Paris fair.

She kept the wares in her modest two-bedroom apartment in the working-class suburb of Montreuil-sous-Bois, explaining to dealers that she had just inherited a large amount of money from her father and would soon be moving to a home more in keeping with her new-found wealth.

When police raided the flat they found a hoard of high quality French furniture including a Louis XIV commode, a bureau mazarin and a royal-blue upholstered four-poster bed.

In response to criticism that the unfashionable address should have aroused dealers’ suspicions, M. Deydier dismissed it as irrelevant. He said the woman was elegant and cultured, and because her flat contained plenty of swish furniture, this allayed any surprise dealers may have felt when delivering there.

At the end of last year the bank became suspicious when BNP-Paribas officials realised €6m was missing from their accounts. In January, they filed an action against Ms H. for the theft of an estimated €15 million.
The woman told police she acted “impulsively” and “out of a passion” for antiques. She had briefly been interned in a psychiatric hospital and claimed that she suffered from a disorder which gave her “a frantic and compulsive urge to buy”.

For some dealers her purchases made up the main part of their sales turnover in 2004. For one dealer it was up to 90 per cent.
The raids on the premises in the Faubourg St-Honoré left a number of dealers placed in police custody. One was then held by police for four days after ignoring a police summons. At least two are now under formal investigation.

M. Deydier said he expects the seized goods will be returned to BNP and appear back on the market in due course.