December 9, 2005

French Frauds

Filed under: Economy,Immigration,Taxes & Government — Tom @ 11:24 am

From The Wall Street Journal (requires subscription), on how France is aiding and abetting its largely immigrant population’s determination not to assimilate with its lax enforcement of welfare rules:

The sprawling unemployment insurance scheme is fighting a losing battle against clever fraudsters. According to a report in Le Monde Wednesday, the courts are investigating 17 organized groups who’ve used the latest technology to swindle millions in illegal dole payments since 1998. In all, the system has lost something between €250 million and €4 billion due to fraud since 1998. That’s hardly small change for a program already €14 billion in the red.

In one case, a French national of Pakistani origin reportedly sold “kits Assedic” — named for the agency that manages unemployment insurance — that enabled 55 people, mostly immigrants, to claim benefits from losing jobs at a fictional small business. The kits went for up to €3,800 each. In another case, the suspect allegedly created 200 shell companies to fool Assedic into paying out €10 million to about 500 of his “clients.”

….. Once caught, according to Le Monde, a majority of the fraud rings’ customers said that they had worked in the black market and were temporarily without work. By this logic, they claimed that the benefits were legitimate, and many Frenchmen seem inclined to agree. Unlike the efforts to whitewash colonialism, these revelations about welfare fraud haven’t stirred up much controversy.

The jobless, who account for a tenth of the French workforce, receive 57.4% to 75% of their last salary, paid monthly for up to four years, depending on seniority. So the incentives to commit fraud are pretty clear. Perhaps the bigger scandal is that the incentives to find a new job aren’t.


1 Comment

  1. There’s the French work ethic for you. It’s too bad they can’t spend as much time working real jobs as they spend working the welfare system.

    Comment by CincyJeff — December 9, 2005 @ 3:47 pm

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