New charges filed in fraud probe against France's National Rally

A former high-ranking associate of France's far-right National Rally has been charged with embezzlement as part of an inquiry into suspected misuse of EU funds, his lawyer said Thursday.

European Union flags flutter outside the EU Commission headquarters in Brussels, Belgium. REUTERS/Francois Lenoir

The charges up the pressure on the party formerly known as the National Front as its leader Marine Le Pen battles to recover public subsidies seized in the case, without which she says the party will go bankrupt.

Charles Van Houtte, a Belgian citizen, was the longtime manager of the contracts of European Parliament assistants for the party's lawmakers in the assembly.

Le Pen and 12 other people, as well as the party itself, are accused of using European Parliament funds provided for assistants to pay more than 20 France-based staff in the party from 2009 to 2017.

They have been charged with breach of confidence and conspiracy to defraud, which carry potential sentences of three years in prison and fines of up to 375,000 euros.

But Van Houtte is the first suspect to be charged with conspiracy to embezzle public funds, a more serious offence punishable by up to 10 years in prison and a one-million-euro fine.

He testified to investigators last September that he had "instructions" from Le Pen to misuse the funds and confirmed the existence of fake contracts -- allegations rejected by party officials.

Van Houtte was charged in Paris on Thursday after appearing before one of the two judges overseeing the case.

"If my client has been charged with complicity to embezzle public funds, it seems logical that all the others be charged with this crime," his lawyer, Henri Laquay, said.

The European Parliament estimates it must be repaid 6.8 million euros for the fraud involving 17 MEPs and about 40 assistants.

This prompted the judges to seize two million euros of public subsidies destined for the party in June, nearly half the total of 4.5 million allocated for this year.

Such subsidies are common in European countries, which see them as a way of ensuring a level playing field for political parties while limiting the risks of corruption or illegal funding.

Le Pen has called the seizure a "death sentence" and warned her party faces bankruptcy from this month.

She has appealed the ruling, and a decision is expected on September 26