France’s Budget Minister Jerome Cahuzac has resigned amid allegations of hiding assets in a Swiss bank account. Cahuzac, who is heading a French government crackdown on tax evasion, denies having kept money in an UBS account since 2010.
Cahuzac’s resignation comes as a major embarrassment to French president François Hollande’s government, which has placed increased scrutiny on finding and prosecuting tax evaders. The government is also in the midst of drafting plans to reduce France’s debt and maintain its fiscal credibility in the European Union, an effort to which Cahuzac was crucial.
Hollande has supported Cahuzac since a preliminary investigation into his banking activities was opened in January.
The investigation into Cahuzac’s banking activities was prompted by a report from the French investigative news website Mediapart, against whom Cahuzac has since issued a defamation complaint. Since the report was issued in December, the French public prosecutor said police laboratory tests showed a correlation between Cahuzac’s voice and that of an individual admitting to holding an undisclosed account at UBS on a recording published by Mediapart.
Paris prosectors opened a formal judicial investigation into Cahuzac’s activities on Tuesday, prompting his resignation.
Cahuzac, a former plastic surgeon who became a prominent, fiscally conservative member of the Socialist Party, will be replaced by current Europe Minister Bernard Cazeneuve.