IMF chief Lagarde ordered to face trial over Tapie payout
Former French finance minister accused of negligence over €400m compensation for tycoon
Christine Lagarde, the former French finance minister and current head of the International Monetary Fund (IMF), could be facing a year in prison.
The BBC reports that the Court of Justice of the Republic in France has ruled that Lagarde, who as IMF chief is one of the world's most important financial figures, must stand trial next year over her role in a €404m (£293m) payout from the state bank to a tycoon, during her time in office in 2008. She is accused of negligence in public office, which carries a maximum sentence of one year's imprisonment.
Bernard Tapie was awarded the sum by a special arbitration panel after direct intervention from Lagarde, who CNBC notes ultimately signed off the controversial compensation. This had followed a 15-year legal battle after Tapie sold his majority shareholding in the sports brand Adidas to a consortium that included the state-backed bank Credit Lyonnais, which later sold the stake on for a hefty profit.
The businessman, who relinquished his holding in order to clear an apparent conflict of interest after taking up a role in Francois Mitterrand's Socialist government, claimed the bank had mishandled the sale and deliberately undervalued the company. He was originally awarded €135m, but he claimed that did not cover the losses incurred.
Legal wrangling has been ongoing for some time and back in 2013 a fraud investigation saw Lagarde's Paris home raided by police. Earlier this month a separate French court ruled that Tapie was not entitled to the compensation and should repay it with interest.
Lagarde's lawyer Yves Repiquet told a French television network the decision to order her to stand trial is "incomprehensible" and that he will recommend she appeal. The IMF boss, who is 59, has five days to do so once the court decision is made public today or Monday.