The French hairdresser Franck Provost was indicted this week for “abuse of corporate assets” and “money laundering in an organized group of aggravated tax evasion”.
Thanks to fraudulent cash register software, several of its salons would have hidden millions of euros from the tax authorities.
"Franck Provost firmly disputes these accusations," said his lawyer, Me Bouchez El Ghozi, on Thursday, adding that "with this indictment, he will have access to the file and be able to defend himself in a very calm manner".
Under judicial supervision "with a deposit set at several hundred thousand euros"
The 75-year-old businessman was indicted on Tuesday during his presentation to an examining magistrate in Nanterre.
Since then, the founder of the Provalliance group, number one in the hairdressing sector in Europe, has been placed under judicial supervision "with a deposit set at several hundred thousand euros," said the Nanterre public prosecutor's office, in a press release.
According to the prosecution, "several reports" had been "transmitted by the tax administration in 2017 concerning the use of fraudulent cashier software to divert cash receipts from a network of hairdressing salons".
A loss of "several million euros"
Franck Provost is also indicted for "providing equipment and programs to commit offenses and breaches of automated data processing systems".
According to a source familiar with the matter, the amount of the damage, to the detriment of the tax authorities and companies, is "several million euros" over twenty years.
A preliminary investigation was opened and entrusted to the National Brigade for the Repression of Fiscal Crime of the Central Office for the Fight against Corruption and Financial and Fiscal Offenses (OCLCIFF).
The investigations relate to facts ranging from 2001 to 2021.
On April 9, 2021, an opening of judicial information had given rise to the indictment of the former administrative and financial director of the group.
For Me Bouchez El Ghozi, the former administrative and financial director would be the only person responsible for the fraud.
This man, who is no longer in office since 2014, "recognized in writing part of the embezzlement", details the lawyer of the "hairdresser of the stars".
“Apart from his statements, nothing has made it possible to establish the charges against Franck Provost, who has not touched a single penny thanks to this software,” he assures us.
Permissive software
"We received an alert in 2013, a series of investigations were conducted" internally and "the administrative and financial director had to leave the group", explains the lawyer, affirming that years later, this man "tries to shirk responsibility ”.
Sandrine Desliard, deputy divisional commissioner to the head of OCLCIFF, explains that “cash register software for all businesses is by definition 'permissive' because they allow accounting errors to be corrected during the day's financial year”.
“But once the exercise is over, we are no longer supposed to be able to modify it.
However, the software in this case was fraudulent because it allowed modifications even after the accounts were closed, ”she argued.
"10%" of the turnover withdrawn
According to number 2 of the OCLCIFF, "the software redid all the accounting to recreate receipts so that it falls right."
"On average, 10% of turnover was withdrawn each day in the salons concerned, which either belonged to the group or were franchised, and was not declared to the tax authorities," she added.
Franck Provost opened his very first salon in 1974 in Saint-Germain-en-Laye (Yvelines) before creating a franchise network in 1995. The Provalliance group, which he founded in 2007, owns 17 brands including the star brands Franck Provost , Jean-Louis David or Saint-Algue, and a network of 4,000 salons including 600 Franck Provost.
In March, a Brussels-based investment fund, Core Equity Holdings, acquired 54% of Provalliance for an estimated amount of between 500 and 550 million euros, according to financial information provider FactSet.
Franck Provost "is today a minority shareholder of the group with his family", according to the communication from Provalliance.
The group which "remains very affected by the covid in 2021", displays a turnover of "about 500 million euros", according to the same source.
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