German coalition party loses appeal against big penalty

Berlin - The junior party in Chancellor Angela Merkel's German coalition, the Free Democratic Party (FDP), lost a court appeal in Berlin Tuesday against a huge fine for accounting irregularities. The administrative tribunal for the state of Berlin rejected a complaint that the fine of 4.3 million euros (6.3 million dollars) was excessive. The fine was a blow, both financially and politically, to the party, which is led by Foreign Minister Guido Westerwelle.

The FDP said it would appeal to a higher tribunal against the penalty imposed by the clerk of parliament for errors in the years up to 2002.

The late Juergen Moellemann, a former federal minister who headed the North Rhine Westphalia section of the FDP, was blamed for the failure to properly account for millions of Deutschmarks in contributions to the party between 1996 and 2002.

Moellemann, a controversial figure because of his criticism of Israel, was under investigation when he died in 2003. He jumped from a plane and did not open the parachute he was wearing.

The fine was imposed under German legislation that grants generous public financing to political parties but requires them to disclose all large donations. The penalty for hiding any income is a loss of some of the public financing distributed by parliament.

The FDP argued that the fine, which was finalized in July this year, was excessive because it had itself investigated and exposed Moellemann's practices. The accounts left out the cost of millions of copies of an anti-Israel leaflet written by Moellemann in 2002.

The FDP, which moved from opposition to the government benches after the German general election in September, has paid part of the federal fine, but contended that the remainder, 3.5 million euros, was too much.