Authorities revealed they have paid €1.7 million in fraudulent claims but prevented the payment of more than €6 million.
The Paris Prosecutor's Office announced on Friday that it had launched an investigation into the "massive fraud" of the country's temporary unemployment scheme with perpetrators pocketing €1.7 million.
"Fraudulent requests for payment of compensation were made by electronic declaration by usurping the company name and the SIRET identification number of existing companies which did not ask to benefit from aid for partial activity," the prosecutor's office said in a statement.
Investigations, first launched by authorities in Toulouse and Limoges, revealed that 13 of the country's 16 regional offices of the ministry for labour "were confronted with massive fraud in the payment of compensation".
They also identified more than 160 corporate victims in the southwestern region of Occitanie and 110 fraudulent bank accounts set up to receive the compensation. Investigators were also able to trace back 18 fraudulent transfers worth 868,000 of which nearly half was recovered from French bank accounts.
"If more than 1,700,000 euros corresponding to fraudulent claims have already been unduly paid by the ASP [National Agency for Payments], the payment of more than 6,000,000 euros was suspended as soon as the infringements were discovered," the prosecutor's statement added.
The French government launched its "temporary unemployment" scheme in late March to prevent companies from going bankrupt or cutting jobs due to the COVID-19 pandemic and the strict lockdown imposed in the country a week earlier to stem the spread of the deadly virus.
As part of the scheme, the government initially agreed to pay workers' wages in full and has since been reducing the amount it pays. It now covers up to 85 per cent of wages with the remaining 15 per cent left to employers. Another reduction is planned for October 1.
Between March and June 22, 13.6 million workers were on the scheme, according to data from the Ministry for Labour.
The country has so far set aside €31 billion to fund the temporary unemployment scheme.