From the Wall Street Journal Magazine, May 24:
He safeguarded the family’s fortune—and their secrets. Now, it’s all unraveling.
TUCKED ONE STREET behind Monte Carlo’s historic harbor, which is famously dotted with champagne bars and anchored by the storied casino that was the backdrop to multiple James Bond films, the Monaco police station may be the most unglamorous building in one of the world’s most glamorous settings.
Gray and boxy, it looks more like student housing on a university campus than a bulwark of security for the global elite who flock here as much for its aura of protective secrecy as its shimmering scenery.
But over two days this February, in the police captain’s office with a window facing up the rocky slope toward the palace, a dapper 68-year-old suspect in a corruption scandal rattled one of Europe’s most storied royal families and shook the foundations of a tiny country built on polished appearances, ironclad confidentiality and tightly choreographed power.
The suspect, Claude Palmero, has salt-and-pepper hair and wears wire-rim glasses. If he looks like an accountant, it’s because he is, and he now finds himself at the center of the alleged corruption scandal.
For much of his adult life, Palmero was the financial gatekeeper for Prince Albert II, Monaco’s ruler for the past two decades and the son of Prince Rainier III and Princess Grace, the Oscar-winning actress formerly known as Grace Kelly.
A devoted sportsman, environmentalist and philanthropist, 67-year-old Albert has a fortune that has been conservatively estimated at more than 1 billion euros, and by all accounts he historically paid little attention to how it was managed. Instead, he entrusted it to Palmero as his administrateur des biens. That role, which Palmero inherited from his father, empowered him to manage Albert’s private fortune, including by orchestrating quiet cash transfers when requested by the prince or others in the royal family.
Palmero oversaw not only Prince Albert’s private fortune but also assets held by the Crown, from prime real estate to a vast array of collections—including cars, stamps, coins and artworks, as well as financial holdings.
But the relationship turned sour in 2023, after a leak of hacked documents implicated Palmero in a number of alleged corruption and influence-peddling schemes. In a casual text message that belied the chaos that was to come, Albert in May of 2023 wrote to his longtime money manager: “I am now more or less obliged to speak out…to ‘blow the whistle’ a little bit to signal the end of recess and try to reassure many people here at home.” He fired Palmero weeks later.
Albert also initiated a broader shake-up at the top of the principality. Dozens of insiders left their posts, including some of Monaco’s most influential power brokers.
The move kicked off a wave of recriminations and more damaging leaks, including from notebooks Palmero meticulously kept about the prince’s private activities.
French newspapers ran some contents of the notebooks, highlighting Albert’s financial support for his children born out of wedlock and their mothers, as well as the spending of his wife—Princess Charlene, a former Olympic swimmer—and other members of the royal family. (Monaco is a principality, not a kingdom, though the public widely refers to its ruling dynasty as a royal family.)
In September 2023, Albert ratcheted up the feud further by filing a lawsuit—along with his sisters—against Palmero, accusing him of breach of trust and theft. The charges were later expanded to include forgery, use of forged documents and money laundering. According to people close to the prince, it was the first time in over 700 years of the Grimaldi dynasty that a ruler filed a criminal complaint against a Monaco resident.
The February interrogations at the police station, spanning two full days, were part of the continuing investigation that is discreetly winding its way through Monaco’s courts.
Palmero has been questioned about Panamanian holding companies, Swiss bank accounts and secret payments made to keep the prince’s private life exactly that—private. During questioning, he was not even allowed to use the bathroom without a guard escort.
Palmero has denied the allegations. Prosecutors have interviewed him on multiple occasions but have not brought any charges. Palmero’s defense can be boiled down to this: All of his activity was designed with the best interests of the prince in mind, including cleaning up the messes made by Albert and other members of the royal family, who paid little attention to their finances and spending.
In February, for example, Palmero was asked about a roughly $15.9 million transfer he made to a company called Étoile de Mer.
Palmero referred the officer to a letter addressed to the prince’s legal team, explaining that the funds had ultimately ended up with a company used to cover expenses tied to Nicole Coste, the former Air France flight attendant and onetime lover of Prince Albert, as well as their son, Alexandre.
The prince “wished for the utmost confidentiality so that this situation would not become known to his wife,” the letter read, according to documents viewed by WSJ. Magazine.
Police investigators also questioned Palmero about a $795,000 transfer flagged by auditors as “suspect.” He described it as reimbursement for years of unlogged spending on behalf of the prince himself, kept private “for reasons of confidentiality” and his own sense of duty and discretion.
Among the outlays Palmero claimed to have quietly absorbed: rent for the prince’s Monaco bachelor pad, the salaries and housing arrangements for Coste’s staff and assorted costs tied to Princess Charlene’s private Monaco apartment, which he said were deliberately kept off the books to avoid leaving evidence that she sometimes stayed outside the palace.
The commingling of funds was further complicated by Palmero’s practice of investing alongside the royal family, which he said he could do because he has a personal fortune of more than $113.5 million, much of which came from an inheritance.
In one instance, police pressed Palmero on why some $185 million—mostly in private-equity funds—was held in a company called Janus, which was owned by Palmero.
“Janus is a two-headed god,” Palmero told police, implying that this was no coincidence. “There were two people involved.”
At times, Palmero got exasperated by the questioning, saying of his former boss: “He now pretends that for 22 years he knew nothing about the state or management conditions of his own assets? He is the sovereign of a state! So either he is lying to serve his own interests, or he should step down—because someone like that should not be allowed to manage anything! It’s utterly ridiculous!”
Some of the prince’s allies agree with at least part of that assessment, suggesting the prince placed too much trust in familiar faces. Surrounded by old friends and advisers who echoed each other’s views, he saw little cause for doubt. The scandal, they say, jolted him into seeing things differently.
Prince Albert took the throne 20 years ago this July, promising to usher in a new era in which Monaco would stand for something more than immense wealth for its own sake. But the scandal is merely reinforcing to many outsiders the famous Monaco descriptor from Somerset Maugham: “a sunny place for shady people.”
IN A STATEMENT TO WSJ. MAGAZINE, Jean-Michel Darrois, Prince Albert’s lawyer, said the prince would not comment on the specifics of the scandal and the dispute with Palmero. “Of course, this episode has been difficult,” Darrois said. “He has taken all necessary decisions and measures to address the issues, strengthen governance and ensure full transparency. The matter is now in the hands of the judiciary, in which he has complete confidence. His focus is now fully on Monaco’s future.”
Palmero’s lawyers, Marie-Alix Canu-Bernard and Christophe Llorca, dismissed the allegations, saying that his management of the family’s assets had only ever been profitable. “The false indignation of the princely family — especially Prince Albert’s — inventing that their estate administrator of 22 years might have tried to appropriate their assets, is utterly staggering,” they said. The lawyers described the barrage of lawsuits as a “palace vendetta” aimed at silencing Palmero’s fight against corruption.
With no income tax for individuals and an obsession with privacy, Monaco is a magnet for billionaires, celebrities and high-net-worth expats looking to shelter fortunes in plain sight. Property prices regularly hit over $110,000 per square meter, making it some of the most expensive real estate on earth. The harbor in the sun-dappled Mediterranean hosts a parade of superyachts—floating mansions stacked with helipads and champagne decks, all moored just steps from the palace.
And once a year, the entire city transforms into a high-octane playground for the Monaco Grand Prix, when Formula 1 cars scream through the narrow streets, watched from private terraces and luxury suites perched above the track.
The principality’s global status is largely the creation of Albert’s father, Prince Rainier III, who ruled for over 50 years. In 1956, he married Grace Kelly, the Hollywood starlet whose image helped cement Monaco’s mystique on the world stage until her death in a car accident in 1982....
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