Swindle allegations throw CSV into leadership crisis
Luxembourg's largest opposition party, the Christian-Democrat CSV, entered a leadership crisis on Wednesday after party members reported president Frank Engel to the public prosecutor, accusing him of misusing company assets.
The scandal revolves around an employment contract under which Engel was supposed to recruit members for the CSV Frëndeskrees non-profit association in return for a salary, according to broadcaster RTL.
But the party's lawmakers had not been aware of the contract, according to Martine Hansen, the leader of the centre-right party's parliamentary faction, who spoke to broadcaster RTL in an interview on Wednesday.
The agreement had only come to light at the association's general assembly a week ago when it appeared in the books, Hansen said. Engel had never done the actual work, the Luxemburger Wort reported, quoting party sources.
The members of the association then commissioned a legal opinion, which led to the allegation of misuse of company assets and the subsequent complaint at the prosecutor's office against Engel, who heads the party as well as the Frëndeskrees - or "circle of friends" - Hansen told RTL.
The prosecutor's office had not received the complaint yet, but "that might change throughout the day", spokesman Henri Eippers said in an email on Wednesday morning. Engel did not immediately respond to a request for comment.
Engel rejected the allegations of embezzlement and fraud on RTL on Wednesday at noon, all whilst conceding that he wrote the contract himself. He said he had "nothing to reproach himself for" and he had "full confidence in the justice system".
Engel failed to attract any new members to the association, which also owns the party's headquarters, RTL reported. He received €40,000 for the contract, according to Luxembourg's Reporter newspaper.
Engel became CSV President in January 2019 after a tight race against contender Serge Wilmes, with his mandate about to expire. He is running for a second term with currently no rival in sight. The election for the new party president is set take place on 24 April during the CSV party congress.
Engel had previously caused a controversy when he backed a wealth and inheritance tax in an interview without having consulted party members, as the party is divided over its ideological stance, with some saying it should become more pro-business and other it should boost its social credentials.
In 2017, Azerbaijan asked Interpol to arrest Engel, who had been an election observer in the Nagorno-Karabakh breakaway region as a member of the European Parliament. Engel, whose wife is Armenian, and his fellow parliamentarians were accused of illegally entering the area.