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France

IMF's Lagarde questioned in court over 'Tapie Affair'

Text by FRANCE 24

Latest update : 2014-03-19

International Monetary Fund chief Christine Lagarde faced more questions in a Paris court on Wednesday over her role in a 2008 arbitration that awarded a massive state payout to controversial businessman Bernard Tapie.

It was Lagarde's third visit to the Court of Justice of the Republic, which is empowered to investigate and prosecute crimes committed by ministers in the exercise of their official duties.

The former finance minister was last questioned in May, when she avoided being charged and was instead given the less compromising statues of "assisted witness" in what has become known in France as the "Tapie Affair".

'I have always acted in accordance with the law'

The case revolves around a controversial €400 million state payout ordered by an arbitration panel in 2008 for Bernard Tapie, a former politician and businessman, over his sale of sportswear company Adidas. The arbitration panel upheld Tapie's claim that the Crédit Lyonnais bank had defrauded him by intentionally undervaluing Adidas at the time of the sale and that the state – as the bank's principal shareholder – should compensate him.

It was Lagarde who, in her role as French finance minister at the time, ordered the case to be heard by an arbitration panel instead of proceeding through the regular courts.

Critics argue that the state should not have paid compensation to a convicted criminal who was bankrupt at the time and would not have been able to pursue the case in court. Tapie spent six months in prison in 1997 for match-fixing during his time as president of France's biggest football club, Olympique Marseille.

They say that Lagarde ensured Tapie received preferential treatment by referring the matter to arbitration due to his financial support for former French president Nicolas Sarkozy – Lagarde’s boss at the time – in his 2007 presidential bid.

Lagarde has always denied any wrongdoing.

Tapie was placed under formal investigation for committing fraud as part of an organised gang in late June of last year.

Orange telecoms CEO Stéphane Richard, who was Lagarde's chief-of-staff at the time of the payout, was also placed under formal investigation for fraud in the matter last June.

(FRANCE 24 with AFP)

 

Date created : 2014-03-19

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