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Chapter X - Politics and Accusations: The "Affairs"

La rançon des grandes actions, c’est la bassesse quand elle prend sa revanche.
(The price of great acts, it’s baseness when it takes its revenge.)
Charles de Gaulle

That Thursday, December 8, 1994, having just arrived from Paris that morning, I had a luncheon meeting at the restaurant Lespinasse on 55th Street in New York with Rand Araskog, the chairman of ITT. I systematically took advantage of my trips to the United States to pay him a visit to discuss our mutual business interests. We had been involved in business matters together for the last ten years, first at Alcatel NV, where he presided over the supervisory board, and then on the board of directors for Alcatel Alsthom which he joined when ITT exchanged its Alcatel stock for shares of Alcatel Alsthom. It was indeed easier for me to have a relaxed conversation with Rand in New York than during his tightly scheduled trips to Europe.

We began our lunch with a very friendly exchange, as usual. The comfortable and elegant surroundings, as well as the almost obsequious attention of the maître d’hôtel, lent themselves to that. It is true that we were in the restaurant of the Saint Regis Hotel, owned by ITT. Suddenly, the head of ITT’s public relations arrived, his look more impenetrable than usual, bringing Rand a fax from his European office calling his attention to an article from the December 9 edition of Le Monde, which had just come out in Paris. Greatly irritated, the ITT chairman held it out for me to see. I read, under the heading “Setbacks for the French group and its chairman Pierre Suard: The American head of ITT might create surprise at the next Alcatel Board of Director’s meeting.” The article stated that “a member of the Board of Directors” (following the ritual formula) was said to have confided: “If Araskog wants Suard’s head, it will be very difficult for us to oppose him.” It was another phase in the underhanded destabilization campaign being carried out in Paris. But what was interesting about that episode was that I got to hear live the strong denials of ITT’s chairman in the heat of the moment, who insisted on responding immediately by a categorical denial. He dictated the response then and there to the head of public relations who noted it at the corner of the table. The written press release was supplemented with verbal statements that the public relations director made to the press and which can be summed up, in substance, as follows:

"Mr. Araskog is greatly annoyed. The article is completely false. Mr. Araskog is a very solid supporter of Pierre Suard. Mr. Araskog understands that times are difficult in Europe, particularly for telecommunications orders, but firmly believes that Pierre Suard has the complete and unanimous support of the Board of Directors."

To my knowledge, the French press said nothing about these clarifications except the December 9 International Herald Tribune which stated:

"ITT denies Alcatel Report: ITT Corp. denied a report in the French press indicating that its Chairman, Rand Araskog, a Board member of Alcatel Alsthom, could push for the resignation of Alcatel's Chairman, Pierre Suard."

Rand assured me once more of his support and trust and we continued our discussions.

I promised myself nevertheless to be more attentive to the development of this destabilization campaign upon my return, all the more since I received a second warning sign on my arrival in Paris.

The return flight itself wasn’t an ordinary one. I made the flight on the Concorde and found myself sitting next to Pamela Harriman, the then U.S. ambassador to France, who was returning to her post. She engaged the conversation, as I abstained from taking the initiative out of courtesy. I discovered in her a personality, whose class and simplicity were striking. She spoke to me of the "affairs" and about the attitude of the press, without hesitating to use her own experience as an example. It is true that she had been rather badly treated recently. We spoke also of international politics. I remember, in particular, the warning that she gave: The United States was changing and Europeans were not conscious of that fact. The growth in the number of citizens of Latin-American and Asian origin was reducing the historical preponderance of the population with Anglo-Saxon and European origins and there existed the risk that in the future, in case of a major crisis, Europe would not as easily find a natural ally in the United States. She questioned me also regarding the situation in France and asked me whether, for example, Jacques Delors would confirm his candidacy for the presidential election. Having heard him respond evasively to that question in a very restricted meeting several weeks earlier, I said that I thought he would not be a candidate. That was not the prevailing opinion in Paris. But it was nonetheless the decision that was officially announced by Mr. Delors the following day. Ms. Harriman had perhaps thought that I benefited from some precise information or good knowledge of the political arena. But that was not at all the case. It was just a matter of chance and perhaps a little common sense.

Back in Paris, I had a meeting scheduled for Monday with the President of the Republic. It would be the first time I would meet with him privately. That meeting had come about fortuitously. On the preceding June 7, I had been invited, along with 200 other people, to an official dinner at the Elysée hosted by President Mitterrand for the occasion of the visit by the President of the United States and the First Lady, Hillary Clinton. Following the usual protocol, each guest was welcomed at the end of a long reception line, first by the French president and then by the president of the foreign country. When it was my turn, I paid my respects to President Mitterrand and then found myself stopped in front of him when the person in front of me extended his conversation with President Clinton. To break the silence, I spoke to the French president concerning the speech he had made the day before for the 50th anniversary of the landing in Normandy. (I admit that I did not dare tell him that I was shocked that he had not mentioned the name of General de Gaulle even once.) After a bit of silence, Mr. Mitterrand said, “Suard, I don’t know you very well. Request a meeting and I’ll receive you.” Not wanting to mix politics and business, I didn’t follow up on that offer immediately. However, in December, with the end of his term approaching, I thought I could make a request for an audience; and I did so before leaving for the United States. To my great surprise, the acceptance came immediately and the meeting was granted for the following Monday at 6:00 pm.

I showed up at the appointed hour. Anne Lauvergeon, the Deputy General Secretary of the President, announced that I would have to wait a little but that, unlike all the other meetings of the day that had been cancelled, I would be received. Upon entering the great office, I found the president fading. We sat down in a corner sitting room and he listened as I spoke, his face pale, still and impassive. I spoke to him about Alcatel Alsthom, of its international development and of several current matters on which Ms. Lauvergeon told me she had made him a report. There was no reaction. I continued; then suddenly, he interrupted me: “Suard, they’re creating a lot of problems for you at this time.”

“That’s true, Mr. President. I didn’t come to speak to you about the 'affairs,' but I can say a few words about them if you would like.”

“It’s not necessary,” he responded; “I had the file passed on to me. I know it’s empty. I told the Government and Mr. Balladur in particular that he was wrong to let the business heads be tarnished and that that’s damaging for France.”

The conversation continued a moment along this theme and I sensed the President much more present. But he only really came to life for the third part of the discussion which he brought up himself—politics. I got to hear his descriptions of his friends as well as his enemies, sometimes very caustic. He told me, in particular, that he was not surprised by the refusal of Jacques Delors, “incapable of winning an election,” to run for president, that he had been saying that for six months to his close staff members (which he indicated by a circular movement of his arm), and that he was alone in his opinion at Elysée. At that moment, while talking about politics, I found the president passionate, professional, at ease, and practically in form; I imagined the masterful analyses and the provocative judgments of which he must have been capable when in his peak form.

He suffered that day and was controlling his illness with stoicism. The audience lasted almost an hour and not wanting to take up too much more of his energy, I indicated my intention to leave. He kept me yet a little longer, and then, with great effort, he got up and accompanied me a few steps to the nearby door adding, “[i]f they must give you other problems, come back to speak to me about them; my door is open to you."

I had many other problems, but I did not return to see him at Elysée. Several months later, after he was no longer president, I saw him again completely by chance. We were having lunch in the same restaurant. After the meal, I stopped discreetly by to say hello. The illness which was overtaking him had visibly progressed and he concluded our brief conversation by this touching advice: “It’s tough, very tough, but you must hang on.” He was saying that to me but implicitly for himself as well.

After these two warnings, it would clearly be necessary to take seriously the media campaign focusing on the "affairs," which were directed at destabilizing Alcatel Alsthom’s chairman.

What were these "affairs?" In the beginning, it was a petty and unfortunately classic affair of misappropriation of funds involving two managers in a branch located near Paris and belonging to one of the group’s French subsidiaries—Alcatel CIT. One of the managers, the financial manager of the branch who was also responsible for the Transmission products division, approved and paid, too accommodatingly, inflated invoices for work that his accomplice, the maintenance manager, had requested. The investigation showed that in certain cases they used companies in which they or their family members had an interest. The misappropriation of funds, which lasted a number of years, had to have involved, in total, several tens of millions of francs.

When the management of the company became aware of the facts during the second quarter of 1993, after having been indirectly alerted by the tax authorities which had undertaken an inspection of the personal financial situation of the two managers, the two employees were immediately dismissed. It was then, in their defense, that they declared that it was common practice in the group to have work done at the homes of managers and to bill it to the company. My name and the name of CIT’s chairman were cited and turned over for public condemnation because constantly in this affair, which was conducted at Evry, the press published information, often biased, which was theoretically covered by the confidentiality of the investigative procedure.

These were not the only appalling practices that I discovered during the investigation. Several weeks after the dismissal of the financial manager, the company was contacted by his lawyer who, without shame, proposed a bargain which I would call a bribe. He stated that his client had an explosive file, kept in a safe place, concerning the audits of the prices charged France Telecom and that he would use it if Alcatel CIT didn’t cease pursuing him. The company obviously refused—and with indignation—to consider this contemptible game. It had, for that matter, a clear conscience. The response was that the company would regret it.

It wouldn’t take long for the company to learn what this was about. It was within the scope of the responsibilities of the financial manager of the Transmission division, among other things, to prepare the documents to be submitted to the PTT at the time of price audits. Pursuant to the traditional scheme of procurement contracts, the government could buy products from its suppliers while controlling their cost price. At the time it used three suppliers which were each, in turn, subjected to price control procedures, and the result of the subsequent negotiations applied to all of the suppliers of the same product. In 1989 it was CIT’s turn. The agency undertook to verify the cost price figures for 1988. At the time of the audit, the financial manager prepared and presented to the agency some documents that he had falsified and which, curiously, penalized the company because it reduced the cost price, which served as the basis of the sales negotiations to come. He had in fact increased the quantities (materials, hours spent) which were included in the direct costs, but reduced the overhead costs which are added to direct costs. As soon as CIT discovered these irregularities, it alerted its customer, which was now called France Telecom. By mutual agreement, an arbitrator was designated to find out whether a prejudice had been created and, if need be, to evaluate it. After several months of discussions, an agreement was reached and CIT paid France Telecom 62 million francs to compensate for the wrong. Although the financial manager had acted without the knowledge of his employer, he nevertheless represented it at the time of the price audit in question. This affair between CIT and France Telecom was, therefore, settled by agreement of the parties.

This matter, which was considered to be explosive, was turned over to the investigating judge. That’s how the sensational matter concerning the over-billing of France Telecom came about. It was widened the following year by spontaneous statements from an accounting manager who had recently been let go for professional inadequacy. He claimed that the same practices existed in the switching area and that the over billed products involved several hundred million francs a year. Members of the press concluded from that, or it was suggested to them, that the over-billings fed a huge secret fund which served to personally enrich the senior managers and provide financing for political contributions.

Naturally, from the start and then again the following year, we always maintained that there had been no over-billings—that all the payments made by France Telecom had been entered into the books and therefore couldn’t have fed a secret fund. With respect to the personal accusations, I always stated that I had paid from my own resources the work and services involving my residence. Particular mention must be made of the installation of security systems that a shrewd and continual amalgam did its best to qualify as personal works.

The security installation originated from a directive by the minister in charge of the police in November of 1986 asking twenty or so company leaders to implement some specific measures of protection against terrorist attacks of which George Besse, after others, had just been a victim. The Minister of the Interior, not having sufficient funds at its disposal, asked the companies to finance out of their own funds the protection of their chairmen. In the CGE group we had a manager specifically assigned to security problems who was in constant communication with the government services. I sent him the minister’s directive and abided by the procedures that he recommended at the office, at home, and during my trips. At my home, the subject of the controversy, a complex system to guard against kidnapping and assassination attempts was installed based on computerization, observance, recordings, calibrated alarms, etc. One of the paradoxes for me was to hear accusations of personal gain supposedly gotten from that situation, whereas everyday life, mine but also that of my family, was actually very perturbed by the presence of these sophisticated devices, from fear that a clumsy move would set off a torrent of alarms or by the management (always somewhat agonizing) of false alarms. In all, over eight years (from 1986 to 1995) the total amount paid by the group was 3.5 million francs. The Board of Directors had always considered that it was up to the group to take as an overhead cost the expenses incurred for the safety of the chairman at that time, as was the case in earlier crises. That was also the continuous position of the government administrations, banks and companies. Indeed, the chairman of Siemens, Von Pierer, using his own home as an example, said that spontaneously when the controversy engulfed Paris.

Because the affair involving the work done for me personally received so much attention from 1994 on and well after my departure from the group, I must outline the principal events. For the public it was symbolized by the remodelling of my bathroom which was supposedly paid for by Alcatel. But it must now be recognized that after an investigative procedure lasting several years and a file containing several thousands of documents, multiple investigations, numerous searches, and the analysis of all of the financial accounts and assets and of their financing, for both me and my family, my initial statements have not been contradicted. My only income was that decided upon by the Board of Directors. The work performed for me personally (including on my bathroom) were paid by me; the security systems, as is the consistent practice and with the consent of the Board, were paid for by the group.

But I think it’s useful to emphasize how difficult it is to establish one’s innocence when faced with a judicial system which seemed to be to be partisan and corporatist.

In principle the judge investigates the accusations and the defenses. I can testify that in my case, his investigation of the accusations was thorough if not without error. As for his investigation of the exculpatory evidence, it was, to say the least, restrained. The principal presumption concerned the alleged payment by CIT or other companies of the group for work done at my residence. The expert designated by the judge said that such payments were possible because the companies concerned received contracts approaching 9 million francs at the CIT Vélizy site; however, no proof of illicit payments was provided. My lawyers asked another expert, an expert for the court in Paris, to verify all of the payments made to these companies by the group and the proof substantiating them. His conclusions are categorical: The total amount of work done by these companies was not 9 million but 6 million francs; all of the payments were made on the basis of invoices approved by an architect and were in accordance with the contracts and estimates. We submitted that second expert evaluation to the judge at the time of my questioning in order that it be included in the investigative file. The court’s expert was aware of it because in a subsequent report, without recognizing his initial error, he cited 6 million francs for all of the work and not 9 million.

That didn’t prevent, two years later, the judge's remand order from again citing 9 million francs nor, even after the court hearings, the prosecutor to still speak in his pleadings about 9 million francs.

The hearings nonetheless brought to light new interesting elements. The original accuser said before the court that the implication of corporate management had been suggested to him but that in fact he knew nothing and regretted what he had done. And then the evening before the hearing at which I was to be questioned, my lawyers again examined the investigative file as it had been handed over to the court. They noted that it did not contain the second expert’s report. They asked the presiding judge if he was aware of it and his response was negative. The following day, at the start of the session, he stated, in his cold and detached voice: “Let Mr. Suard’s lawyers be reassured; the second expert’s report has been found. It had been forgotten in the investigating judge’s desk drawer.” We, of course, spoke of it again during the hearing; but the prosecutor must have been distracted because his pleading, several days later, mentioned again the erroneous 9 million franc figure instead of 6 million, an error which is nevertheless not insignificant when prison sentences are required for the supposed payment of sums not owed.

That accusation concerning payment by the group for personal work deflated progressively. At the lower court level, the prosecution maintained its charges in full (even on the basis of a figure which was recognized as false by the court’s expert). But the court only convicted me for payments made to one of the companies (out of three). On appeal, the prosecution abandoned its charges and, on the basis of the facts, the court released me completely.

But the investigating judge, aware of the weakness of his case, added, in the last weeks of the investigation, a new facet of charges: The intervention to my benefit of an architect paid for by the group. I had naturally held in high regard this professional for the work performed at my home. But the bulk of his work was done for the group which compensated him for that. The court didn’t accept either my statements or the documents provided and convicted me on this count. On appeal, the prosecution maintained its charges on this point, but the court released me from these accusations.

At the end of five years of proceedings, it was finally determined that I had, in fact, paid from my own resources the work performed in connection with my home. I had paid myself for the remodelling of my bathroom!

After the ruling by the court of appeals, I only remained held for the security system and then only on an indirect argument. The manager in charge of security, who was particularly preoccupied with keeping secret the security measures that were installed at my home, took the initiative to have indicated on the invoices other addresses than those of the place where the equipment had been installed. Only he, therefore, was familiar with the complete arrangement. From the beginning of the investigation, he immediately turned over the complete file to the police. The judicial position continuously evolved with respect to these works. The investigating judge considered it as expenses incurred for purely personal purposes and, therefore, as constituting a misappropriation of company property. And inasmuch as he considered me, even though I lacked authority to act for the companies that had paid for the work, a de facto manager of all the companies of the group, he accused me of misappropriating of company property for these security expenditures. At the lower level, the court recognized that it was legitimate for the group to protect its chairman, even at his residence; but it concluded that I no longer ran any risks in the 1990’s. As a result, it upheld the misappropriation of company property charges for those years. However, I returned the security system devices upon my departure from the group and paid from my own resources for those which could not be removed. The court determined that the invoice that the group sent me (at a time when I was no longer exercising any functions for the group) was not of a sufficient amount and convicted me for misappropriation of company property in the amount of that “deficiency,” which was arbitrarily valued. Before the court of appeals I provided affidavits from the highest civil and military authorities emphasizing the continuance of the risk of terrorism at the time of the Gulf War and afterwards. The court, in order to convict me, adapted a completely different approach. It did not dispute the reality of the risk nor that it was appropriate for the group to protect its chairman (with a Byzantine nuance between the parent company and the wholly-owned subsidiaries). Neither did it continue to maintain that I was the de facto manager of all of the subsidiaries. Instead it determined that the modification of the invoices by the head of security, which had been done at his own initiative and for the reasons of confidentiality explained earlier, alone constituted misappropriation of company property for which it convicted me as an actor or receiver.

Several months after the decision of the court of appeals became final, I received a letter from the Grand Chancelier of the French Legion of Honor advising me that, in accordance with the rules of the Order, I could be subjected to disciplinary penalties sanctioning members of the Legion of Honor who had committed an act not considered to be honorable. Further on the letter specified that three types of penalties could be applied: Censure, temporary suspension, or expulsion.

With the assistance of my lawyers I submitted a written report which, after having set forth a summary all of the judicial proceedings, concluded:

"The decision of the appellate court on March 23, 1999, rendered me a partial justice. It firmly dismissed the charges that could have implicated my honesty, but it maintained an unjust and unjustified charge, even if it didn't concern my honor."

Several months later I had the satisfaction of knowing that I had been heard. The Council of the Order

"...after deliberation had, in substance, determined that, in view of [my] high-level functions and of the circumstances at the time and, in particular, of the serious and genuine danger which affected [my] safety, the legal offences for which [I] was charged did not constitute acts by [me] which were truly contrary to honor or integrity;"

and, therefore, didn't impose any sanctions on me.

That decision of the Council of the Order of the Legion of Honor reassured me somewhat. That eminent body was the first to understand the true nature of the security problems with which I was faced. Throughout all of the questionings and hearings of the judicial proceedings dedicated to these security expenses, I encountered nothing but scepticism and even irony.

Daily examples in public and business life show how institutions have it in their interest to protect the image and safety of the person representing them—the one through whom they are personified in the eyes of the public. The example is obvious for our highest political representatives. No one is disturbed, and for good reason, that the homes of these high level figures are protected. None of them are irreplaceable. Candidates to succeed them are generally numerous. But destabilization of the functions they personify is sought through attacks against them. To ensure the respect of that function, it is, therefore, legitimate to protect the party personalizing it. In these diverse cases, society (the taxpayer) legitimately assumes the burden and costs for the protection of those who contribute to the functioning of this public service. It would seem no less legitimate that a business organization ensure the safety of the person that represents it and personifies it in the eyes of its partners, its customers, and the public. That was the position consistently adapted by Alcatel Alsthom’s Board of Directors.

To be effective, the protection must cover all risk situations. The specialists are in agreement that among the places where attacks are most often committed, the route of travel comes in first; then comes the home, the office and other places frequented regularly. In the opinion of even the police, “the risk run by high-level managers at their place of work is less than at their home” insofar as fixed locations are concerned. That indeed was what was recommended, in substance, by the “consignes de vigilance” (instructions for vigilance) aimed at preventing terrorist activities which had been provided to me, as well as to several other company chairmen, by the minister responsible for the police on November 28, 1986.

At the time, the organization Action Directe had, for a period of several years, made symbolic figures of the army and business its targets. It had claimed responsibility for 80 explosive attacks on symbolic buildings since 1984. It had also attacked human targets. René Audran, who headed the International Affairs division of the Ministry of Defense, was killed in front of his home at La Celle-Saint-Cloud on January 25, 1985. The General Comptroller of the Armed Forces, Henri Blandin, escaped death while leaving his home on June 26, 1985, and on April 15, 1986 Guy Brana, the vice president of the French employers association, survived on his doorstep the crossfire of two men positioned nearby.

On November 17, 1986 George Besse, chairman of Renault, fell in front of his home to the gunfire of two young women, members of Action Directe.

That attack, coming after many others, stirred up strong emotions and not only for those who knew the victims. I already explained how I knew Georges Besse and the nature of my esteem for this fine engineer and great business leader. But during the same time period I was also friends with and saw frequently Guy Brana who, along with his function in the French employers association, headed the cable group of Thomson that we would acquire.

It was only natural, therefore, that I would follow the security measures recommended by the Minister of the Interior after that cruel assassination, all the more since other attacks were perpetrated in neighboring countries, such as Germany, where Alcatel Alsthom had important subsidiaries. The chairman of Deutsche Bank, Dr. Alfred Herrhausen, was killed on November 30, 1989 and Detlef Rohwedder, the chairman of the German employers’ association, was murdered in his living room on April 1, 1991 by the Red Army Fraction.

The continued existence of the risk in my case, which was questioned by the court, had to be confirmed by a letter from the Minister of the Interior dated July 20, 1998, which explained:

"The threat against the managers of major French companies, and especially those working for the military, whether closely or otherwise, appeared at the time (1986) very great. A certain number of measures were thus taken for these managers. Thus, Mr. Pierre Suard would have benefited from certain arrangements….The evaluation of the threat affecting figures like Mr. Suard would later evolve in relation to several events. Of course, the disappearance of the threat represented by Action Directe could only be perceived gradually, all the more since the German Red Army Fraction and the Italian Red Brigades, which had committed attacks with this movement, pursued their criminal activities several years after."

The letter then set forth the particular measures concerning me that had been continuously in place until 1996.

The simplest but significantly more costly solution to protect someone at his home is to provide security guards, which necessitates the full-time employment of at least five guards to ensure permanent security. The solution selected by Alcatel Alsthom’s security manager rested on electronic surveillance and alarms, which only calls for human intervention when there is a confirmed threat. During the nine years for which the necessity of protection was recognized, a surveillance by security guards at my residence alone would have cost eight to ten times more than the 3.5 million francs noted by the investigating judge. To be effective the make-up of the system had to remain confidential. Its presence required scrupulous compliance by the occupants of the residence with a certain number of procedures, very restrictive in practice, as I emphasized earlier, and which, to say the least, certainly did not constitute an advantage for those who had to “benefit” from it or, in reality, put up with it.

I recently listened, with bitter irony, to an interview of Ms. Elisabeth Guigou, who was then the Minister of Justice. She was questioned concerning the protection of her property in the country by eight policemen who were complaining about their working conditions—“tired of the trailer and bunks, tired also of living near a pile of manure.” I would have been able to take the response of the minister as my own:

"That protection, it’s not me who made the decision. It was a decision made by the responsible authorities—that is, the Minister of the Interior and the Minister of the Defense. I can even say that I would prefer not to need it. But it’s also not me who decides the conditions in which they carry out their responsibilities. All of that is decided by the responsible services."

That was, in substance, the explanation that I gave on the witness stand at the lower court level, as well as the court of appeals—but in vain. I was, therefore, punished for the systems of security that the court had nonetheless judged legitimate in light of the risks existing at the time and consistent with Alcatel Alsthom’s interests. But I am reproached for the way that they were recorded in the books, a method of which, according to the court, I must have been aware even though all of the statements throughout the investigative procedure and the hearings proved the opposite. And that’s how this matter—kept alive by a media campaign on the theme of alleged personal work, bathrooms, private mansions and other privileges for which the all-powerful chairman was said to have unjustifiably charged to his company—was decided by the courts once and for all.

When I manage to step back a little, I can’t help but point out the extraordinary determination to implicate me that was revealed by this proceeding. In the beginning, false accusations, recognized as such on the witness stand by the one who had made them; systematic leaks in the press citing “judicial sources;” and continued follow-up in the press which, several times, indicated that the actions of the judge could be hampered in this sensitive matter (as will be seen, it was rather the reverse). A witness told me that during his examination, the judge showed him an organization chart of the Alcatel Alsthom group (even simplified, it contained a lot of companies) and asked him: “Where is Suard?” My examinations ended always around 7:30 or 7:45 pm, and could, therefore, be thoroughly covered by the 8:00 pm television news programs. At that time the Evry courts are deserted. One night, in leaving the office of the investigating judge and going down the stairs and hallways toward the main entry, my lawyers and I noticed a journalist obviously telephoning to his newsroom the contents of the interrogation, from which that day (as with others) large excerpts of the record were cited in the press the following day. Several times, at the end of the afternoon, the judge received a telephone call during the examination to which he responded, disturbed: “I haven’t yet finished. Call me back a little later.”

I filed a complaint for breach of the confidentiality of the proceeding, providing solid proof. A judge was designated to investigate. When I was heard, he didn’t leave me much hope. He appeared sincere when he said he was shocked by the systematic breach of secrecy which rendered the investigation public and, in fact, condemned the suspects in the public opinion before any judgement. But he said he was unable to prove who was responsible for the leaks inasmuch as there were many, and that copies of the file documents were numerous and circulated by fax, sometimes received in premises relatively accessible to the public. As a result, I didn’t hold out much hope, and indeed several years later, I still have received no news concerning that proceeding.

I must also point out the crafty willingness to confuse the misappropriations proven against the two managers and their accomplices and the alleged acts of which the investigating judge accused me. His remand order referred to a widespread system of corruption of which Alcatel CIT had been the victim, which, according to him, explained all the misappropriations, practically minimizing those of the two managers because, in the opinion of the investigating judge, the example came from above.

So we were all transferred to the Evry court together. The presiding judge indeed indicated from the beginning that there were, in fact, two different matters and the hearings were conducted accordingly. That didn’t stop the press coverage from constantly confusing the two. Throughout these numerous hearings, and the waiting in the hall with a crowd which came daily to this court located in a tough suburb outside of Paris, I couldn’t help but think of the excesses of revolutionary justice and the drama of political proceedings. The rich and powerful are guilty by nature. Their explanations are superfluous—no point in hearing them at length and if it’s necessary to keep up appearances, make a mockery of them. It was in that spirit that the presiding judge, when he examined me on the witness stand, asked me if when I went to Germany I took the security system from my apartment with me. That was supposed to be funny.

The unions joined the proceedings as private parties, which resulted in a lot of arguments denouncing capitalism and employers, but the most caricatured was made by the lawyer for the CGT. That lawyer—in an argument which seemed outmoded on the class struggle, profiteering managers and exploited workers—delivered a grandiloquent speech as if for the coming of the grand night of the saving revolution. At the court as well, I noted the fortunate coincidences favoring media coverage. The prosecutor finished his arguments demanding imprisonment at 12:45 pm, which permitted it to be covered by the 1:00 pm news program, which, of course, got the scoop. The day on which the judgment was handed down, television broadcasters were allowed to film the hearing room at length—in fact the star defendant, while waiting for the delayed arrival of the judge. Yet up until that day the presiding judge had denied them access. As a result, I was able to see myself at length on the 8 pm news, seated on the defendant’s bench.

During several years and in successive waves, the accusations of which I was the victim were reported, analysed and commented upon at length; but practically nothing was said about the dismissals ultimately obtained. After the decision of the appellate court, only Valeurs Actuelles did an article which was entitled “Honor Returned;” and Marianne provided a brief mention of the decision. I didn’t even have the satisfaction of seeing it mentioned in the Alcatel news update bulletin, which had conscientiously reported over several years all of the articles implicating me. Thinking that it was an oversight, I pointed it out in writing to the communications director of the group, but only in vain. As far as everyone was concerned, I was guilty and had been convicted a long time ago. It was a closed file for which there wasn’t, even for Alcatel, the possibility to go back. It's true that the management team that took over Alcatel after my removal didn’t make a big effort to counter the rumours that were discrediting me with respect to my former colleagues.

For example, in October of 1995 they let a report be published in the Canard Enchaîné that they knew was false and about which they had been questioned by the newspaper before the publication. I was said to have had the capital gains obtained by the exercise of Alcatel stock options paid in Bermuda, protecting them, in that manner, from taxation in France, a problem which was said to have been “uncovered” by the investigating judge. In reality, just the opposite was true. Alcatel had created a structure for the repurchase of shares resulting from the exercise of stock options in such a way as to be able to allocate the new shares among Alcatel's shareholders on a pro-rata basis. Each would in effect retain its percentage interest in the capital of Alcatel. For tax reasons related to the diverse nationalities of the shareholders, the lawyers recommended registration of that holding company in Bermuda. That explains why I was paid capital gains for Alcatel stock options by a check written on a Bermuda bank. I deposited it in my Paris account, declared the income to the tax office, and paid the tax in France. It was in simply reviewing my bank statement, where the entry, in fact, was perfectly clear, that the judge had “uncovered” this “problem.” Far from having hidden this income in a tax haven, I had, to the contrary, deposited and declared in France the sums coming from it. I would add that that procedure applied to all Alcatel stock option beneficiaries. I don’t know if all of them deposited in the place of their tax residence the capital gains earned! My successor, disturbed, assured me that he did not understand why his staff members, when questioned by the satiric weekly bulletin, had not corrected this piece of information, which was then repeated by most of the newspapers. As for me, I don’t understand why his staff members permitted to be published in the internal news update, without setting the record straight, the various articles which picked up the story, and why when questioned during the Worker’s Council meeting, his representative said at the first session that he was not informed, and at the following session had corrected the information appearing in the press but made sure that the correct information was not included explicitly in the record of the meeting.

With respect to the alleged over-billings of France Telecom, it is more difficult for me to explain because this issue has not yet been decided in the courts. I must, all the same, make two comments. One concerns the transmission line of business; the other, switching.

The defense of the transmission financial manager consisted of maintaining that he had acted under the instructions of his management, which is false. Why would management have taken the risk to end up at a reduced cost price and, thus, less profitable price discussions? The truth is that the financial manager wanted to create a means of pressure for the day when his misappropriations would be discovered, something which his lawyer tried to do. He had indeed taken care to give a copy of the file to a friend, an investigator in the security branch of the police department. By minimizing the cost price, he knew that the discussions with the PTT would go much easier and therefore that the management would not be prompted to review his calculations and accounting in order to defend them before the customer. To put together the files, he had former retired employees come back and compensated them under the table from a secret fund that he had set up. It seemed to me, after investigation, that the whole team had probably been inspired by the practices that were taking place during the 60’s and 70’s, but which I know had stopped in 1981 at the latest. When I had rejoined Alcatel CIT in 1984, supervising the transmission business as explained in the first chapter, I did not find a business profiting from great margins. It was, to the contrary, the time-frame when I struggled to prevent LTT, which was losing a million francs a day, from going into bankruptcy!

With respect to switching, even though the accusations of over-billing were the same, the situation was radically different. The facts go back to 1991. That year, and for the first time, France Telecom became an ordinary commercial company which dealt with its suppliers according to private sector commercial practices. It no longer fell under the procurement contract regulations and could no longer exercise cost price controls. An agreement signed with its suppliers gave it the right to conduct accounting audits of the relevant company. The company, which was free to establish its cost accounting procedures, only had to provide its accounts and other information demanded of it. France Telecom’s challenge related to the documents that were provided during the 1991 audit. In practice, France Telecom maintained that the overhead costs included research expenses and risk coverage which did not relate to the supplies destined for it and that that had not been revealed. Alcatel CIT said that these details had not been requested and that it had, at the time of the audit, responded diligently to all the demands made by the customer. It is legitimate and even indispensable, and, moreover, current practice for a company to recuperate in its costs its expenses for research, development and marketing. It was only by psychological rigidity that France Telecom, no doubt misguided by its administrative past, did not understand that when it became a commercial sector company, it was no longer governed by administrative law.

Naturally, there were no over-billings. The invoices were prepared according to the price of the contracts and the quantities delivered. Another paradox is that the prices that CIT agreed upon with France Telecom were the lowest of Europe, for switching as well as for transmission. For switching, they were even lower by more than 10 percent to what France Telecom agreed to pay to its other French supplier.

Yet it is these so-called over-billings concerning switching which resulted in my being charged, on March 10, 1995, for the receipt of fraudulently obtained property, harming France Telecom, even though at no time during the investigation or since has my direct participation been established or even alleged. These contracts concerned Alcatel CIT alone, a subsidiary in which I had no management responsibilities; and I wasn’t even a director of the company.

Nevertheless, these charges were accompanied by draconian judicial restraints: A ban from meeting with any employee or manager of Alcatel Alsthom or France Telecom; a ban from working for Alcatel Alsthom; and, an additional harassment obligating me to alert the judge of my comings and goings. That ban from working for the group, directed at its chairman for events in which he is not alleged to have participated and concerning a subsidiary over which he had no direct authority and for which the sales represented less than 10 percent of those of the whole of the group, remains, seven years later, unique. But the investigating judge responded in this way to a strange and miraculous anonymous letter contained in the file: “As long as Suard is not removed, lips will remain sealed. Signed: A collection of managers.” “Collection” wasn’t really CIT vocabulary. Suard having been removed, the lips nonetheless revealed nothing new, even seven years later.

It was then that the destabilization campaign which had been underway for several months came out into the open. From the beginning, it was the work of Ambroise Roux, who brought along some directors or assured himself of their neutrality; and, to my great embarrassment, I was the last to become aware. It is true that I held that former chairman in high esteem. He was one of the several great business leaders that I knew and respected throughout my professional life. I believed in the sincerity of the things that he expressed to me. I should nevertheless have paid closer attention to the cynical maxims that Cardinal Mazarin summed up in his Breviary for Politicians. A friend had sent me a copy of this work at the beginning of my chairmanship, alerting me particularly to Axiom N° 1: “Agis avec tous tes amis comme s'ils devaient devenir tes ennemis.” (Behave with all of your friends as if they must become your enemies.) That’s the exact opposite of my code of ethics but I should have made an exception for Ambroise Roux and some others!

Officially, Ambroise Roux held me in high esteem and repeated often that he considered me his spiritual son. It was not he, as he liked to tell it, who named me in 1986 as the chairman of CGE, but the Government’s choice suited him very well from the moment that he was appointed as a director of the company. I didn’t wait very long to discover his intentions. He came to see me often and we spoke freely. Quickly I noticed that the ideas or projects about which we had spoken one-on-one made their way to the press. So I became more careful. It’s in this way that, despite his insistence, I refused to create a Strategic Committee of the Board of Directors over which he would have presided. From his point of view, it was a matter of being able to supervise the chairman’s actions in a small committee separated from the whole of the Board of Directors. But I couldn’t accept to devalue, in fact, the role of the other directors to satisfy the former chairman regardless of the esteem that I held for him. When Ambroise Roux became certain that I would not give in, I started to read in the press that the chairman of CGE was a man very much on his own in managing the group.

On the other hand, I was able to easily satisfy him in other circumstances. The Board of Directors was held in a room the decor of which had not been changed, I believe, for many years. Around the large table, the directors took their places as determined by the secretary of the board in identical chairs, except that the chairman's chair had a back which was a little higher. Ambroise Roux, as honorary chairman, was seated, according to ritual, facing the chairman. One day the secretary alerted me that Ambroise Roux had asked for a chair with a higher back. Placing no importance on such details, I asked that he be given my chair at the next meeting. Ambroise Roux stated then that he did not want to deprive the chairman of his chair but he asked for a second one of the same type. We told him that we didn’t have two. He insisted and suggested that we check in storage. He was right. We found another chair of the same type and so were able to satisfy him completely. At another meeting of the Board of Directors, one of the young receptionists brought into the meeting a message for him. At the end of the meeting we got to see real anger. He insisted that we dismiss the poor young woman in order that no one, from now on, forget that it was necessary to follow the traditional ritual and say “Mr. Chairman Ambroise Roux” in addressing him. We explained that to the receptionists; we didn’t let the ill-fated employee go but avoided assigning her to tasks that could require her to cross paths with “Mr. Chairman Ambroise Roux.”

More seriously, on a Monday morning in January of 1988 I received a telephone call from Carlo Benedetti who informed me of his tender offer for Société Générale de Belgique, of which we held some percentage of its shares. He added that he counted on our support as Ambroise Roux had promised him. I wasn’t at all aware of these dealings. I told him clearly that there was no question about it: I had confidence in Governor Lamy who ran Société Générale de Belgique. He had always acted with great loyalty at the time of the creation of Alcatel NV, of which he was a friendly shareholder; and the relations between the two groups were excellent in Belgium and elsewhere. In the stock market battle that the Benedetti Group had just launched, we were going to remain loyal to Générale de Belgique to the end. In fact, our holding turned out to be pivotal. Neither of the two rival groups which were after the bank, Suez or Benedetti, was able to gain the absolute majority of shares. It was at the request of Governor Lamy that we finally voted with Suez; that’s how Suez was able to take control of the illustrious Belgian financial institution. Ambroise Roux never brought up that incident, and neither did I.

We went up against each other more harshly in connection with Générale Occidentale, of which he had been chairman since 1987. One day he requested an urgent meeting for an important and very confidential matter. Without having spoken to me about it, he had negotiated the acquisition of the L’Expansion group. The contents of the agreement quickly appeared to me to be unacceptable. The difficult financial situation that the group was in did not justify the price agreed upon and, moreover, the role left to the owner-seller would have meant that Générale Occidentale had not in fact taken over the company. I refused. Later, I discovered how much he had committed. He had, for example, signed a lease for the company L’Express, which was owned by Générale Occidentale, to move into the premises of the L’Expansion group. We did not use that space but had to pay the rent anyway.

But with the passage of time, I’ve come to think that I unwittingly signed my death warrant during the preparation for the 1989 General Meeting of Générale Occidentale. I discovered that, among the resolutions presented at the General Meeting, one concerned the age limit of the chairman, which was proposed to be raised from 68 to 72 years. But the rule of 68 years had been applied across the board in the CGE group for a long time and I refused to make an exception for Générale Occidentale. The resolution was withdrawn. Several months later Ambroise Roux, having reached the age limit, had to step down as chairman of Générale Occidentale.

Our periodic meetings became from then on more ambiguous. One day he discussed with me at length his skill for replacing chairmen, citing several examples. Naive, I listened with curiosity but didn’t imagine for one instant that it was no doubt a warning.

Another time he started the meeting by telling me with the episcopal unctuousness he liked to affect, that the publication of my salary in the press, stated to be the highest among French employers, “without being dramatic, was nonetheless disturbing.” I responded that it was all the more disturbing that the information was incorrect. He lost his self-control and told me he did not agree. He knew perfectly well my remuneration because he presided over the Board of Directors committee that determined it. I then showed him why the information appearing in the press was inaccurate. He had misinterpreted a decision of the committee, and it was that which was the origin of the leak.

Revealing salaries of top company managers is not usual in France or Europe. In the United States, to the contrary, everything is public for companies listed on the stock market. Across the Atlantic a very high salary is proof of worth and success. In France, on the other hand, it’s a subject of scandal and reprobation—unless, of course, you’re a soccer player, show business star or top model. My remuneration, everything included, was 12 or 13 million francs a year during the better years (half depended upon results). That’s certainly a significant sum, but it wasn’t the highest in France whereas Alcatel Alsthom was the largest group in France. Compared with international standards, it was modest, especially after deducting of taxes. At that time, the chairmen of General Electric and AT&T earned in one year the equivalent of my remuneration during the nine that I was chairman of the group. But in France that remuneration led to my being criticized and fed the envy of detractors when the “affairs” were in center state. It’s in that way that a socialist leader who was preparing for responsibilities at the highest level, without mentioning my name, stated that someone who earns 12 or 13 million francs a year can pay for the work done on his bathroom. I would respond, without mentioning his name either, that someone who aspires to be a statesman doesn’t spread slander even by electoral demagogy or Trotskyite loyalties.

The person that had given the amount of my salary to the press was very farsighted!

In 1994 the campaign intensified along the theme that Pierre Suard was indeed on his own and was not preparing for his succession. At the time I was not yet 60 years old. I knew that talent in the 40’s age group existed in the group and that, when the time came—that is, in several years—it would be possible to promote to the head of the group one of those young managers. That assessment, in fact, would be confirmed by the make-up of the management committee five years later. With the exception of the chairman and the president, who joined the group from outside in 1995 and who were both more than 60 years old, the other members of the management committee (who were younger) were with the group in 1994 and I knew them.

In the fall of 1994 it was said to me that a close staff member of Total’s chairman had indicated at a dinner that soon her boss would be at the head of Alcatel Alsthom.

Then the campaign became more precise. It was predicted that I would have difficulties at the December 21 Board of Directors meeting which was to take place the day after my first interrogation by the investigating judge. To everyone’s surprise or disappointment, it had to be recognized that the Board of Directors would renew “its unanimous confidence in its chairman.” The publication Capital added: “The discussion is put off to the January 25 Board of Directors meeting. In the meantime, the establishment [the people in high positions or with influence] wonders who indeed could hold such a grudge against Pierre Suard....” The December 20, 1994 edition of L’Expansion was more explicit:

"The shadow of Ambroise Roux hovers over Alcatel. The misfortunes of Pierre Suard, his distant successor, are mobilizing Ambroise Roux, the honorary chairman.… For several days now the Paris business inner circle has been circling its shadow on a new front in a destabilization initiative, the calibre of which will leave its mark. Ambroise Roux, 73 years of age, along with other barons on the Board of Directors, is believed to be orchestrating the campaign against Pierre Suard, who has fallen from his pedestal as untouchable by the establishment in the grip of the ‘affairs.’… It was thought that the moment of truth might come on December 21 at Alcatel’s Board of Directors meeting. But since the ‘true-false’ leak of the newspaper Le Monde forecasting that Rand Araskog, head of ITT and a director, was getting ready to settle up with Pierre Suard regarding his management, the pressure has miraculously let up. What still remains unknown is the judicial factor, the only true menace which still weighs on Pierre Suard. If he comes out of that intact, his future would seem to be assured for the short term."

In January I was interviewed at length by La Tribune, which ran its story under the headline, “Alcatel Alsthom: Pierre Suard’s counter-attack.” Ambroise Roux called me the next day to tell me that he found it very positive and helpful. He had also, at the beginning of the month, sent me a letter of unusually warm wishes:

"You are facing with a lot of courage a very difficult media and judicial campaign. Our job, that of all of your directors and mine especially, is to stand by your actions totally, to support you, and to help you should you deem it necessary. Count on me to be entirely at your side in mutual confidence that I hope to be as complete as possible."

That didn’t prevent the press from reporting, following the January Board of Directors meeting where the atmosphere was as good as it had been at the meeting before, a comment made in confidence by a director: “It’s a disaster. Nothing is moving.”

The judicial constraints that were imposed upon me on March 10 rushed to the aid of those who went to work to prepare for my ousting.

Anticipating coercive measures, before showing up at the hearing ordered by the investigating judge on March 10, I called Marc Vienot. I asked him if he would agree to cover for me temporarily if it became impossible for me to continue to carry out my responsibilities. Since the beginning of the year, a formally adopted management committee had been assuring the leadership of the group which, otherwise, remained largely decentralized and, therefore, in the hands of the managers of the large sectors or subsidiaries. Moreover, the general manager, who was perfectly familiar with the group, could cover most things coming up during the interim. I sensed that Marc Vienot was very uncomfortable about my call and evasive in his responses, even if, in the end, he reluctantly gave me his agreement. I understood later the reasons for his discomfort. Initially, the Board of Directors, having met again on March 12, confirmed its confidence in me, left the general manager in charge temporarily, and decided to wait for the decision of the appellate court regarding my appeal of the constraints ordered by the investigating judge. It simply put together a special committee presided over by Ambroise Roux and made up of six directors to follow the activities of general management. At last, the strategic committee which the honorary chairman had wanted since 1987 had taken shape!

It was during this period that took place what, after the passage of time, seems by far the most outrageous; and yet I was not spared the slightest defamation, slander, or betrayal throughout all of these months.

While we were waiting for the court’s decision regarding our appeal of the constraints that had been imposed upon me, the public prosecutor for Paris called my lawyer to make him aware of his surprise at what he had learned—the continuation of the judicial restraints on Pierre Suard would suit Alcatel Alsthom’s Board of Directors. Stunned, I suggested to my lawyer to immediately call Marc Vienot. He responded that he knew nothing and that that was certainly not the opinion of the majority of the Board of Directors. I then proposed that he call Ambroise Roux. The answer was not disappointing. “What you’re telling me there, Mr. Bâtonnier (Bar President), is very unfortunate for Mr. Suard. Who indeed could have talked? It must have been Rand Araskog who....” Still the same mark! But this time it was a show, admittedly improvised on the spot. It was not plausible. Rand Araskog doesn’t speak French. Moreover, he is extremely concerned about respecting procedures, always surrounded by lawyers. Could it be imagined that he would be that candid with the Chancellery and moreover, speak in the name of Alcatel Alsthom’s Board of Directors? I later came to know who the person close to Ambroise Roux was who had been charged with the task.

On April 14 the appellate court finally handed down its decision, which had originally been scheduled for April 5. It maintained the order banning me from working for Alcatel Alsthom, as requested by the prosecuting attorney, but lightened appreciably the other aspects of the judicial restraints. The obligation to alert the judge of my comings and goings was removed and the ban on meeting people was limited to those with charges against them and to company managers and the accountants of Alcatel Alsthom and France Telecom. The Board of Directors, which met on April 18, decided to designate Marc Vienot, a director, as chairman and assigned him the task of finding my successor. Those who had initiated the destabilization campaign without much regard to the means had succeeded. My replacement was selected rapidly because contacts had already been made. The only stumbling block was negotiating the financial terms. It’s not because they were replacing the “best paid company leader in France,” who was criticized a bit on that account, that it would be necessary to accept sacrifices, an approach with which I agree because the remuneration which was fixed by the Board was appropriate in accordance with customary practices and the size of the group.

That day my Alcatel Alsthom adventure ended. I would leave the position as chairman on the basis of charges which had not been proven, a fortiori not judged, and without even having the opportunity to be heard by the Board of Directors. When, at the end of May, Marc Vienot announced the choice of my successor to the press and his appointment effective the following June 22, he indicated that I should continue as a director to the end of my term, which would expire four years later. He determined that, “indeed, to exclude Pierre Suard from the Board of Directors would be extremely unfair, since he benefits from the presumption of innocence.” The interim president had, moreover, indicated at the time of the meeting where these decisions were made that the Board of Directors was indeed conscious of committing an injustice with respect to Pierre Suard. Despite this favorable attitude, my successor demanded several months later that I leave the Board of Directors, and to avoid a public debate at the General Meeting, I accepted to resign my position as director in December of 1995. The new chairman of the group didn’t want me to attend the Board of Directors meeting when he examined the 1995 financial accounts. If the reader has read the preceding chapter, he will easily understand the reasons for my being banished. Let me point out that, no doubt in the event I refused to resign, the debate would have been brought before the General Meeting and the media, duly misinformed, would mention a financial disagreement: "The chairman did not want to pay the high financial compensation hoped for by his predecessor, who is negotiating every inch of the way his departure from the Board of Directors.” That was totally false but had the merit of distributing in advance the roles of the good and the bad.

I filed an appeal at the highest level court against the decision of the court of appeals, which was partially set aside on July 25 on the basis that the persons (company managers and accountants) with which I couldn’t have contact were insufficiently identified. The chamber of the court that reconsidered the case lifted the order banning me from meeting with anyone but on the basis that the time passed since the commission of the facts was sufficiently long to make the measure unnecessary—which goes to show that a few months added to a few years changes everything! The court of final appeal, on the other hand, in its July 25, 1995 decision, maintained the order banning me from working for Alcatel, pointing out that it was a temporary measure. The temporary aspect would last many years!

The press naturally covered at length the decisions of the investigating judge. The majority of the commentaries talked about a chairman dethroned and fallen from his pedestal, or with irony: “A slap in the face for the super-chairman.” Many again took up the fantasies regarding the money from over-billings, calculating the amount of money misappropriated for private use or political payments. Questions were raised about the funding of my hôtel particulier (private mansion) in Neuilly. Yet I never had a hôtel particulier, in Neuilly or elsewhere. Each denial brought new defamatory statements. One journalist who surely doesn’t question for one minute the level of his professional ethics entitled one of his editorials: “Can Suard stay?” Several days later, he answered the question himself on a foreign radio station: “Suard must leave.” Several weeks after my resignation, as it happens, we crossed paths in the lobby of a hotel, a leading hot-spot for business breakfasts. “How are you?” he asked, as affably as ever. “Oh, very well of course!” I answered with a smile, without saying another word and without stopping. I can still see his face stiffen and grow pale with surprise. He didn’t know me if he thought that I was going to listen to this sanctimonious hypocrite justify himself.

March 15, several days after the judge banned me from working at Alcatel, TV Channel 2 offered to let me explain myself live on the 8:00 pm news program. Despite the risks involved and the cautionary advice that I received, I accepted. The risk that I ran was my introductory statement. To the question of the journalist, “So, why are you speaking?” I answered that, faced with the flood of maligning comments, it was a matter of defending the image of the group and my honor because “enough is enough.” And I was able in this way to speak rather freely during 15 or 20 minutes concerning the Alcatel affair (something for which I am very grateful to Jean-Pierre Elkabach, head of the newsroom). I didn’t reveal anything that hadn’t already been made public, but live and with utmost sincerity, I was able to assert my innocence and that of the group. I repeated that I had paid from my own resources for the work done for me personally, that the security work had been paid for by the group with the approval of the Board of Directors, that there were never any over-billings, and that all the sums received were entered in the accounting records. I challenged anyone who could prove the contrary to do so. None of the claims advanced had been established. The coercive measures taken by the judge were shown to be out of proportion. The beginnings of a judicial error were there and I cited precedent: Bruay-en-Artois, Gregory, and the Dreyfus affair. That day, Channel 2 demonstrated another proof of violation of the confidentiality of the investigative procedure by citing, in the story that preceded my interview and of which I had not been forewarned, the over-billing figures from an expert’s report and information concerning my personal property that I had given to the investigating judge the day before.

That televised interview brought me unanimous criticism from the media’s inner circle and even an intervention by the trade union for the judiciary which protested because, according to them, the judge, held to an obligation of silence, could not respond. That was the epitome of irony, as for a period of over two years all the details of the investigation had been published by the press, even announced in advance, citing "judicial sources."

On the other hand, my television interview set off an enormous burst of sympathy from the general public, often from those with simple backgrounds. I received several hundred letters of encouragement and for a long time people that I met on the streets, sometimes crossing the street or retracing their steps to do so, made it a point to tell me that they were moved, that they believed I was innocent, and that I had to continue to fight. For me, that reaction of the simple people made more of an impression than the disapproval of the “in” crowd.

Mention must also be made of the spontaneous support that I received from many employees of the group. The CGC (French management union) representative didn’t hesitate to make an appeal to the office of the Minister of Justice. The chairman of the Supervisory Board for the Fonds Commun de Placement, the second largest Alcatel Alsthom shareholder, courageously sent an open letter to the Minister of Justice. He sent me a copy on which he added: “You will note that it expresses the feelings, exasperations and concerns of the majority of our co-workers; feelings that were reinforced after having seen you and listened during the televised news program on Channel 2 at 8:00 last evening.” The response of the Minister of Justice, totally academic, recalled the principles of the independence of judges and respect for the law. Yet several days later the Chancellery seemed to have taken over from the Paris prosecutor’s office the steps initiated by Ambroise Roux! Even after several years the letter from the chairman of the Fonds Commun de Placement to the Minister of Justice, which can be found in the appendix, remains absolutely relevant—not one word to be changed, not one assertion invalidated by the subsequent investigation.

I can’t resist the temptation to refer to a public testimonial of a great elder of the cable industry, the late François Brunner, former chairman of the Câblerie de Cossonay in Switzerland and long-time chairman of the ICDC (International Cable Development Corporation), where I knew him. He sent a letter to the Swiss newspapers which was published widely:

"Mr. Pierre Suard, Chairman of the company Alcatel Alsthom, has been accused by the French justice system. It so happens that I have known Pierre Suard personally for a number of years. We worked together in technical collaboration for the benefit of our respective companies and other cable companies in America, Europe and Japan. Mr. Suard is not only an employer profoundly honest and upstanding, but he has extraordinary capabilities in managing and developing the companies that he leads. He is a person of great modesty and exemplary behavior in human relations.... Alcatel Alsthom brought France major contracts from all over the world, giving work to thousands of employees. It is to be hoped that, for the good of the company, its employees, its shareholders and the whole of France, Mr. Pierre Suard can continue without incident to attend to Alcatel Alsthom, which he manages with so much competence.

To make this writing complete, I must say that several serious journalists publicly raised questions about the judicial excesses involved. Ivan Rioufol, for example, under the heading, “The downfall of Pierre Suard, judges and power” wrote on March 13, 1995:

"Pierre Suard, Chairman of Alcatel Alsthom, has fallen without having first been tried. Under investigation and placed under judicial restraints Friday by the judge Jean-Marie d’Huy, he was thereby forced to abandon his functions at the head of one of the leading and foremost French companies. Even Bernard Tapis hadn’t experienced such harshness. Of course, Mr. Suard was spared the degradation of pre-trial detention, the ultimate weapon of ‘petty judges’ in their new combat against corruption. But once again, the secrecy of the investigative procedure and the presumption of innocence have been deliberately ignored. It seems that judges believe they can do whatever they please.... Pierre Suard’s downfall gives a new dimension to this judicial offensive without precedent in France. It is led by ten or so poorly paid investigating judges who have decided to purge in a spectacular way the reign of ‘easy money. Some of their motives are commendable. Too many bad habits have been taken up. A sense of impunity has led to abuse—for the right-wing as well as for the left and in politics as well as in business. Improving the morals of those in power had certainly become necessary. But judges must avoid arbitrariness. The system of justice will ultimately tell whether an honest man deserved this affront, which brings him down to the level of an ordinary racketeer. In any case, it is unfair to see the chairman of the third ranked French industrial company be treated more severely than Mr. Tapis with his sleights of hand. And it must be recognized that the discretionary power of the judges favors these excesses, all the more since the notion of misappropriating company property at the origin of numerous indictments is itself subject to flexible interpretation."

"The chairman of Alcatel is perhaps guilty of dubious management of certain funds of the company. But the judiciary, for the moment, knows nothing. It hasn’t been able to render a final decision in this matter after a due hearing of the parties. Yet Mr. Suard, who employs almost 200,000 people, is already publicly condemned. Presumption of innocence? Secrecy of the investigative procedure? The obvious violation of these fundamental legal principles is outrageous."

And it is all the more outrageous that seven years later the investigation concerning the alleged over-billings to the detriment of France Telecom is still not closed, the accusations of fraud and, a fortiori, the receipt of fraudulently obtained property have not been established, and no dubious management of company funds has been proven or even suspected. It is nonetheless on the basis of these allegations, which he is unable to support after several years of investigation, expert reports and examinations, that the investigating judge decided on March 10, 1995, alone and with arbitrary authority, to isolate me from Alcatel Alsthom.

That day, he put an end to my professional career. As painful as that was for me on a personal level, that decision seems to me to have been even more harmful to Alcatel Alsthom itself, at least as my colleagues and I had conceived it and had developed it.

We had, in less than a decade, radically transformed it. A group essentially French, still with business activities rather diversified in the beginning of the 1980’s, it had become ten years later a recognized player on the international scene, a leader in the telecommunications and cable industries and among the two or three leaders for transportation and energy. It was present in all markets. It had control of its technologies and, especially, had acquired unique expertise in those (such as optical transmission and ADSL) which would make possible high output transmission for the Internet era, as well as mobile communications, which would become the principal telecommunications market in the world in the years 2000. Alcatel Alsthom also manufactured 200 MW-plus gas turbines, the biggest cruise liners, as well as the TGV, the high speed train holding the world record for speed and the most sold in the world.

But we also wanted this international group to be deeply united, which implied the sincere support of the majority of the employees for the objectives and values underpinning the overall strategy, something very difficult to obtain. We saw its future in maintaining its portfolio of telecommunications, energy, transportation and related service businesses and the continuation of its policy of technological independence following the example of its great competitors—American, German and Japanese. We also wanted it to strengthen the financial dimension that it had acquired and to continue to satisfy the legitimate hopes of its shareholders which it asked to participate in the high technology ambitions of the group, requiring continuity and time. We were committed to adding value to the investments of our shareholders, but that creation of value had to be measured on a long-term basis and not each quarter and it had to be shared with the employees, the major players in its creation. Finally, we wanted that, despite its international dimension, the group not lose its European and, more particularly, its French culture. It was that ambitious project, shared by many, that went under on March 10, 1995.

During an examination by the Evry investigating judge, after having stated once again that there had never been any over-billings of France Telecom, I added that it had to be feared, on the other hand, that these unfounded charges brought against Alcatel CIT would damage its credibility with its customers, reduce its orders, and ultimately bring about the loss of several hundreds of jobs. That was the only time I saw a troubled expression on the judge’s face; he blushed slightly and I heard him respond in a murmur, “But there were offenses.”

Which ones, your honor? Seven years later the investigation, which is still not closed, hasn’t established them. I was far from imagining that day the dramatic consequence that this judicial torture would have for Alcatel Alsthom. It wasn’t several hundreds of jobs that the group would lose, but tens of thousands.

What followed was indeed instructive. Alcatel Alsthom lost the majority of its businesses, its name, and its world rank—one after the other. What’s more, it isn’t even known yet, seven years later, when this descent into hell will come to an end. What a waste!

<< Chapter IX: The Tarpeian Rock   -   Epilogue >>

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