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IMF chief to go on trial over payout scandal

International Monetary Fund (IMF) Managing Director Christine Lagarde listens during the High-level Tax Symposium in Chengdu, China, July 23, 2016. ©Reuters

The managing director of the International Monetary Fund (IMF) must be put on trial over a massive state payout to a businessman in 2008 during her tenure as France’s finance minister, the country’s top court rules.

Last December, a special court ruled that Christine Lagarde should be tried for negligence that paved the way for the payment of 404 million euros (445 million dollars) in compensation to tycoon Bernard Tapie.

Lagarde appealed the court decision, but France’s Court of Cassation, the highest court of appeals in the country, rejected her request on Friday.

She is expected to be tried at the Court of Justice of the Republic, a special body that tries ministers for wrongdoing while in office.

The case may go to trial before the end of the year if the judges and lawmakers agree on a specific date, a judicial source said.

Patrick Maisonneuve, the lawyer representing Lagarde, expressed regret over Friday’s court ruling, saying he was convinced that the trial would show her client’s innocence.

Tapie, a former French football team owner and some time pop star, won the payout in 2008 in a case against the French public bank, Credit Lyonnais, arguing that the bank had undervalued his stake in the Adidas sportswear company in the mid-1990s.

This file combination of photos shows IMF Managing Director Christine Lagarde (L) and French tycoon Bernard Tapie. ©AFP

Lagarde signed off the payout as France’s then finance minister.

However, investigating magistrates found evidence of carelessness on the part of Lagarde, saying her action had led to a gross “misuse of public money.”

Critics also described Lagarde’s move as a sign of close relationship between the French political elite and magnates such as Tapie, who was close to the then president, Nicolas Sarkozy.

Lagarde has denied any wrongdoing, emphasizing that she had a “clear conscience” regarding the case.

“I’ve always acted in accordance with the law, and I’ve always had in mind the public interest,” she said in a recent interview with AFP.

In January, Lagarde was appointed for a second five-year term as the head of the IMF.

She is the third managing director of the Washington-based international organization to face legal proceedings.

In a statement released on Friday, the IMF voiced support for Lagarde, noting that its board has confidence in her ability to carry out her duties.


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