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France

IMF’s Lagarde investigated in French corruption case

© Thomas Samson, AFP | IMF chief Christine Lagarde

Text by FRANCE 24

Latest update : 2014-08-27

IMF chief Christine Lagarde revealed Wednesday that she is under formal investigation in France for “negligence” over her role in a 2008 corruption case that involved a controversial state payout to French tycoon Bernard Tapie.

The former French finance minister told the AFP news agency that she had no intention of resigning from her position at the International Monetary Fund (IMF) over the investigation.

"I return back to Washington where I will indeed brief my board," she said.

The case revolves around a controversial €400 million state payout to Tapie ordered by an arbitration panel in 2008 over his sale of sportswear company Adidas. The arbitration panel upheld Tapie's claim that the now-defunct 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.

Critics have said the deal was too generous, and was symptomatic of the cosy relationship between money and power in France

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.

FRANCE 24’s Stephen Carroll explains the ‘Tapie Affair’

The shocking news that Lagarde had been placed under formal investigation in the case came just a day after she was questioned for the fourth time by a special court in Paris that handles ministerial misconduct.

Lagarde, who has always denied any wrongdoing, said that she planned to challenge the decision.

"I have instructed my lawyer to appeal this decision, which I consider totally without merit," she said.

(FRANCE 24 with AFP, AP)

Date created : 2014-08-27

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