TG: Discuss the origins of L’Orèal and Eugene Schueller
|Eugène Schueller at the helm of his yacht|
TS: Eugène Schueller, son of a baker and a domestic servant, was kind of a Horatio Alger figure who transcended his humble roots to attain a position of enormous wealth and power in France. Armed with a degree in chemistry, in invented a synthetic hair dye that gave birth to L’Oréal in 1909. The company prospered, expanded overseas, and eventually became the world’s number one cosmetics group. In addition to his brilliance as a chemist and entrepreneur, though, Schueller nursed far-right political views and financed one of the most notorious pro-fascist movements, La Cagoule, in the 1930s. He continued to support pro-German groups during Word War II, and actively collaborated with the Nazi occupiers. His wealth and connections allowed him to escape conviction in the post-war “épuration” trials, but as I document in my book, Schueller was not just an economic collaborator but a political supporter and informant of German security officials. After the war, he recruited a number of French collaborators and Nazi sympathizers into the ranks of L’Oréal, a fact that caused the company great embarrassment with it was revealed in the 1990s.
TG: What is the significance of L’Orèal and other marquee brands to France’s image and economy?
TS: L’Oréal is considered a “fleuron” of French industry—that is, a kind of flagship company that is important not just economically but also in terms of national prestige. L’Oréal is not only a major employer and tax contributor, but an emblem of France’s image as a fount of luxury, elegance, refinement, and glamour. This is also true of the big couture houses—YSL, Chanel, Dior, Cardin—and purveyors of luxury goods like LVMH. But L’Oréal’s position as the world’s number one cosmetics firm gives it an especially lofty status as a symbol of French prestige.
TG: You explore several issues in your book that need to be explained to American audiences.
• French political campaign financing and the way that politicians circumvent it
• French inheritance laws and the legal system that applies-no trial by jury
TS: French laws governing political financing are much more restrictive than U.S. laws. In the U.S, the existence of PACs and the Citizens United decision means, in effect, that there are no real limits on political funding. This is why the U.S. has the most expensive political campaigns in the world, and why major donors like Sheldon Adelson and the Koch brothers have an obscenely disproportionate weight in our electoral system. In France, individual contributions to political campaigns are currently limited to €7,500 ($8,800) per candidate per election, and companies are forbidden to make political donations. To circumvent these limits, French parties and politicians have historically resorted to a variety of illegal methods, including kickbacks on public works contracts, channeling money through cutout companies, and undeclared cash payments by donors like André Bettencourt. Bettencourt was a well-known and much solicited source of illegal political financing, which explains why he was given numerous cabinet positions over the years.
As for the French inheritance laws, they are still rooted in the Napoleonic Code. French law requires parents to leave an incompressible proportion of their estate to their children. In the case of an only child like Françoise Bettencourt Meyers, that portion is 50%. The remainder of the estate, known as the quotité disponible, may be left to anyone. In fact, Liliane Bettencourt had already bequeathed 92% of her estate to her daughter in 1992, so there was no legal barrier to her giving the rest to François-Marie Banier if she so chose. The daughter’s legal challenge was not based on inheritance laws but on her claim that Banier had taken advantage of Liliane’s declining mental powers. The suit was tried before a panel of three judges, since jury trials are only used in the case of violent crimes in France.
TG: Discuss the young Liliane, her marriage to André Bettencourt, her relationship with her daughter Françoise Bettencourt Myers and ultimately her relationship with François-Marie Banier.
|Liliane, André, Françoise, 1988|
TS: Liliane’s mother died when she was five. She was raised by her father, Eugène Schueller, whom she idolized almost to the point of obsession. In 1950, she married André Bettencourt, scion of a respected family from Normandy. Schueller had actively encouraged the marriage, but it was far from a perfect match for Liliane. A closet homosexual, and a mediocre man with no diplomas of any kind, André busied himself with a political career funded by his wife’s money. Meanwhile, Liliane had a difficult relationship with her introverted daughter, Françoise, more interested in her books and her piano than the active social life Liliane wanted her to lead. For all her wealth, Liliane was bored, lonely, and depressed. When Banier entered her life in 1987, he opened the doors to a whole new, exciting world of art exhibits, theater, museums, witty conversation, glittering company. She fell in love with him—though it was a platonic affair given Banier’s sexual orientation and the 25-year age gap between them. As their relationship developed, she began to shower him with artworks, cash, real estate, life insurance policies totaling, on paper at least, nearly a billion euros. She justified all this as patronage meant to fund Banier’s artistic career as a photographer, writer, and painter.
|François-Marie Banier and Liliane Bettencourt|
Banier encouraged and accepted her extraordinary largesse, but he also had a genuine affection for her. Theirs was a complex relationship, but it would be mistake to reduce the whole thing to a cynical manipulation by a self-serving gigolo. Did Banier take advantage of their relationship for material gain? Undoubtedly. But I’m convinced that Liliane was a willing and knowing benefactor. The amounts involved seem mind-boggling to ordinary folk—myself included. But bear in mind that what she gave Banier was a tiny fraction of her overall fortune, and a fraction of the company stock she has already willed to her daughter.
TG: At the end of the day, although the alleged witness tampering by Françoise is yet to be adjudicated, what is the impact of L’Affaire Bettencourt?
TS: The scandal has definitely tarnished the image of the Bettencourt family in public opinion. Before it erupted, the Bettencourts lived discreetly, scrupulously avoiding the media spotlight. The suit launched by Liliane’s daughter in 2007 suddenly exposed the whole family to the harsh glare of public scrutiny. All the dirty laundry came out in the press—Liliane’s father’s murky past as a suspected Nazi collaborator, L’Oréal’s postwar infiltration by ex-Nazi sympathizers, André Bettencourt’s anti-Semitic wartime articles, Liliane’s health problems and creeping dementia, Françoise’s jealousy of Banier and resentment of her mother, secret Swiss bank accounts and tax evasion schemes, and of course the torrent of L’Oréal dividends that Liliane showered on Banier. Today, André is dead, Liliane lives in the fog of senility, and Françoise is under investigation for allegedly bribing a witness. Not much glory in all that for the once proud Bettencourts.
As for Banier, it is true that he will face no prison time and, on appeal, managed to avoid a ruinous fine. But he must live with the fact that he was found guilty in court of abusing the weakness of Liliane Bettencourt—he is a convicted felon. The case poisoned ten years of his life, cost him millions in legal fees, and gravely damaged his reputation. Today, 70 years old, he continues to work and enjoy a comfortable material life, thanks to Liliane’s millions. But he is in many ways a wounded, disgraced, and broken man.
|Ex-Presdent Nicolas Sarkozy|
Another victim of the Bettencourt Affair, at least indirectly, is Nicolas Sarkozy. At one point, he was put under formal investigation for allegedly accepting illegal campaign funds from the Bettencourts. Though those charges were dropped, the former president remains under investigation in a related case. Along with numerous other legal and political embroilments, the Bettencourt Affair contributed to his failed re-election bid in 2012 and his unsuccessful comeback attempt this year.
If there is a lesson in all this, perhaps it’s that we should not envy the super-wealthy. Their riches often bring more problems than they solve. This affair always reminds me of the opening line to Tolstoy’s Anna Karenina: “All happy families are alike. Each unhappy family is unhappy in its own way.”