Behind the surface: A world of fraud and corruption

Bouygues, a major business group, operates in France and outside its borders. Bouygues is the owner of TF1, a top French television channel, Bouygues Construction the world's second biggest global contractor and Bouygues Telecom one of the three biggest mobile phone operators in France. Behind the glorious surface Bouygues hides a tradition of anticompetitive behaviour.

In the 1990's Bouygues was accused of malpractice on several occasions. In 1995, the French police raided the Bouygues Group headquarters over an investigation on alleged frauds and illegal deposits in a Swiss bank. Bouygues chairman Martin Bouygues later admitted that his company had paid over 300 000 euros (then ecus) to a slush fund, used to fund the re-election campaign of the former mayor of Lyon. Bouygues was later granted a 700 million euro road building contract in Lyon.

For years, until 1996, Bouygues was involved, together with over 30 other French building companies, in a web of cartels created to bid for a series of public sector contracts. The contracts included the construction of the TGV high-speed railway and the Normandy Bridge in France. Bouygues was imposed a 19 million euro fine for its involvement in the cartel.

Between 1989 and 1996, Bouygues was part of a corrupt cartel that dealt with the construction of schools in the region around Paris. Contracts worth over four billion euros were shared out by three major French building companies: Bouygues, Suez-Lyonnaise and Vivendi. Bouygues was sentenced to a fine on the grounds of public funds' misappropriation.

No turn for the better

The series of malpractices does not end at the turn of the millennium. In 2005, Bouygues Telecom got its share of the biggest ever competition-related fine in the history of France. From 1997 to 2003 the company exchanged figures on mobile phone users monthly with two other big mobile operators, Orange France and SFR. Between 2000 and 2002 they also fixed their market shares. The total fine imposed on the three companies amounted 534 million euros, out of which Bouygues Telecom's share was 58 million.

The three operators, Bouygues Telecom included, are now back in court to appeal against the fine that the Paris Appeals Court already upheld once in 2006.

Photo: Philippe Guignard