Probe into Lagarde's €400m 'sweetheart' deal for businessman
Friday 05 August 2011
The stainless reputation of the new International Monetary Fund (IMF) chief, Christine Lagarde, is to be tested by a French court investigation.
Six judges decided yesterday that there was prima facie reason to investigate Ms Lagarde for "complicity in forgery and embezzlement" for approving a €400m (£346.4m) legal settlement to a controversial businessman in 2008.
There will now be a lengthy, formal inquiry on behalf of the special court which tries alleged wrongdoing by French ministers and former ministers. A trial, if any, would still be several years away.
Consequently, there is no immediate threat to Ms Lagarde's position as chief executive of the IMF.
She was elected to the IMF's top post last month to replace another former French finance minister, Dominique Strauss-Kahn, who faces charges of attempted rape in New York.
In nominating Ms Lagarde to the post in June, Paris gave assurances to other governments that the allegations against her would come to nothing.
Ms Lagarde, 55, is accused of exceeding her authority as finance minister to push through a "sweetheart" settlement of a long-running compensation dispute between the French government and the disgraced tycoon and businessman Bernard Tapie. There is no suggestion she benefited personally from the deal, but opposition politicians allege Mr Tapie received an unjustifiably high settlement because he switched allegiances from left to right in the 2007 presidential election to support Nicolas Sarkozy.
Once a senior international lawyer, Ms Lagarde, rejects any suggestion that she acted illegally or politically. She says the settlement, recommended by an arbitration panel that she appointed, was the best way to end a long and poisonous dispute.
Mr Tapie, 68, rose to fame in the 1980s and early 1990s by rescuing a series of failing companies, including the German-based sporstwear firm, Adidas.
He became the owner of the leading football club, Olympique Marseilles (OM) and was appointed minister for urban renewal in a left-wing government.
Later Mr Tapie sold Adidas to the then state-owned bank, Crédit Lyonnais.
After Adidas was resold the following year, Mr Tapie persuaded a court he had been badly treated or cheated. However, no final agreement could be reached on a figure for compensation until Ms Lagarde appointed an independent arbitration panel in 2008.
- 1 Heavy metal producer's corpse to be mutilated by models as per his dying wish
- 2 Man who held up 'hire me' sign at Waterloo station returns a year later with 'I'm hiring' sign
- 3 Nineteen-year-old student left gifts for parents before taking her own life
- 4 Deliberately urinating before sex can increase risk of urinary tract infections
Man who held up 'hire me' sign at Waterloo station returns a year later with 'I'm hiring' sign
'Je suis Muslim': Hundreds rally in Australia over portrayal of Islam and Prophet Mohamed
AirAsia QZ8501: Black box reveals warning alarms 'screamed' before crash, as more bodies recovered from near fuselage of jet
Nineteen-year-old student left gifts for parents before taking her own life
Isis Japanese hostages: Video purports to show Haruna Yukawa executed and second hostage Kenji Goto with new terms for release
British Muslim leaders outraged after Eric Pickles says followers of Islam should 'prove their identity'
UK terror fears: My jihadist son returned from Syria mentally scarred – now he is being ignored
Nigel Farage: NHS might have to be replaced by private health insurance
Billy Crystal: 'Stop shoving gay sex scenes in my face'
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
David Cameron says anyone criticising Eric Pickles' letter to Muslims 'really has a problem'
£15000 - £50000 per annum: Recruitment Genius: Fantastic opportunities are ava...
Negotiable: Recruitment Genius: A Compute Engineer is required to join a globa...
£25000 - £28000 per annum + 25 days holidays & pension: Ashdown Group: PHP Web...
£35000 - £40000 per annum: Recruitment Genius: Based in London, Manchester, Br...