IMF Chief Lagarde Ordered to Stand Trial in France

23 Dec 2015 | Author: | No comments yet »

IMF chief Lagarde faces trial in France.

PARIS – International Monetary Fund chief Christine Lagarde has been ordered to stand trial in France over her role in a 2008 arbitration ruling that handed 400 million euros ($434 million) to French businessman Bernard Tapie. Lagarde, who was French finance minister at the time, denied wrongdoing in a statement Thursday and said she had ordered her lawyers to appeal the decision. The case will be heard by magistrates at the Cour de justice de la Republique, which judges ministers for crimes in office, France’s prosecutor general confirmed. The decision came despite the prosecutor’s recommendation in September that investigations be dropped against Lagarde for alleged negligence in the affair while she was France’s finance minister.

Tapie was once a majority shareholder in sports goods company Adidas but sold it in 1993 in order to become a cabinet minister in Francois Mitterrand’s Socialist government. Lagarde’s lawyer, Yves Repiquet, said he would be recommending that she appeal against the decision, which would bring her to court over an affair that dates back more than 20 years. But the Court of Justice of the Republic on Thursday has decided that she has a case to answer, according to a spokesman at the court, which is a special body for trials of government ministers. He sued the Credit Lyonnais bank over its handling of the sale, alleging that the partly state-owned bank had defrauded him by deliberately undervaluing the company.

The spokesman did not have details of the lengthy written decision, and could not say exactly which charges were retained and therefore how much prison time, or fines, she might face, if convicted. Earlier this month, a French court dismissed Mr Tapie’s demand for a further payout of over a billion euros, ordering him instead to pay back the original compensation. Critics say the deal was too generous to Tapie at the expense of the French state, and that the case shouldn’t have gone to a private arbitration authority because it involved a state-owned bank.

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