IMF Chief Christine Lagarde To Stand Trial In France For Negligence

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Christine Lagarde

The head of the International Monetary Fund, Christine Lagarde, has been ordered to stand trial in France over her involvement in a dispute when she was France’s finance minster in 2008.

She is accused of negligence and could face a one year prison sentence.

dpa International reports:

In a statement released by her lawyer, Lagarde said she would appeal the order. Lawyer Yves Repiquet said that Lagarde, “acted in the best interest of the French state and in full compliance with the law.”

Lagarde, 59, has been under investigation for alleged negligence for her involvement in the arbitration of a dispute between businessman Bernard Tapie and French bank Credit Lyonnais in 2008 that awarded Tapie 400 million euros (445 million dollars).

Critics said the award to Tapie, a close friend of then-president Nicolas Sarkozy, was overly generous. Lagarde has consistently denied wrongdoing. There has been no allegation that Lagarde benefitted personally from the transaction.

In September, prosecutors recommended dismissing the case against Lagarde. The IMF director has had to undergo lengthy hearings in Paris in connection with the case. Prosecutors originally said that during mediation she had pushed for a settlement that was far more than might have been decided by a court.

“[Lagarde] shares the prosecutors’ view that there is no basis for any charge against her,” her lawyer said in the statement.

The Law Court of the Republic, where Lagarde was ordered to appear, is a special court for French government officials. If she is found guilty, Lagarde could face up to one year in prison and a fine of up to 15,000 euros.

Lagarde has headed the IMF since 2011, taking over from former French finance minister Dominique Strauss-Kahn, who was forced to give up the post following a sex scandal.

An IMF spokesman said the institution would not comment on Lagarde’s case, but added that, “the executive board continues to express its confidence in the managing director’s ability to effectively carry out her duties.”