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 Vicki Huddleston's allegations, which she said dated back two years, strengthened the view that the Mali rebellion was funded largely by ransoms paid in recent years. In February 2011, three of the hostages seized at a French uranium mine in Niger -- including one Frenchwoman -- were freed; four remain in the hands al-Qaida-linked militants in Mali.
The Islamist rebels retreating northward are apparently taking their Western hostages with them -- among them the mine workers and three other French citizens seized elsewhere.
Huddleston, who served as ambassador to Mali and held positions in the State Department and Defense Department in the U.S. before retiring, told France's iTele network that the French money allowed al-Qaida's North Africa branch to flourish in Mali.
"Although governments deny that they're paying ransoms, everyone is pretty much aware that money has passed hands indirectly through different accounts and it ends up in the treasury, let us say, of al-Qaida in the Islamic Maghreb and allows them to buy weapons and recruit," she said in the comments that aired Friday.
Magnus Ranstorp, a terrorism expert at the Swedish National Defense College, said a French policy of paying for hostages through middlemen has been clear for years and has broad support from a public that sees near daily references to the hostages on television and in print.
"There is a political consensus that is being built subtly. Every single day you are reminded that you have nationals somewhere," Ranstorp said. "It's through several middlemen. It's almost a normal business transaction."
The primary drawback as far as France is concerned, he said, "is a security cost because wherever French people go they become prey."
Huddleston said the $17 million payment was intended to win freedom for the hostages kidnapped in September 2010 from their guarded villas in the Niger town of Arlit, where they were working with French nuclear company Areva.
"France paid ransom for the release of these hostages," Huddleston said.
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 Claude Gueant, who was French President Nicolas Sarkozy's chief of staff at the time, on Friday denied that France had ever paid a ransom and said intermediaries had been negotiating to free the hostages. Philippe Lalliot, the current spokesman for the foreign ministry, dismissed Huddleston's comments as based on "rumor."
"On these statements, if you want to quote them very precisely -- statements that point to rumors -- I don't have a particular comment to make. On the situation of our hostages more generally, you know . that it is a concern for us at every moment," Lalliot said.
Even as France launched its military intervention in Mali on Jan. 11, the hostages remained in the French public eye. Rarely a day goes by without a story about their possible whereabouts.
Diane Lazarevic -- whose father Serge was abducted in Mali in 2011, and is among the missing captives -- said each week of the fighting has brought new fears.
"All of us have imagined a scenario about how it could end, what they (the extremists) will demand, how it will happen. We have thought up a thousand different films in a loop in our heads and how it will unfold," she told The Associated Press this week.
"I'm still hopeful, but with this military intervention and the progression of military force close to the kidnappers and the hostages, it is becoming very difficult and very nerve-wracking."
[Associated
Press; By LORI HINNANT]
Associated Press writer Jamey Keaten contributed to this report from Paris.
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