Christine Lagarde, the head of the International Monetary Fund, will face charges in France relating to a decision she made back in 1993 as the Finance Minister under French PM Sarkozy.
Lagarde’s attorney said on Thursday he planned to recommend his client appeal a French court’s decision to go to trial over her decisions the Bernard Tapie/Credit Lyonnais scandal in the early 1990s
“It’s incomprehensible,” Lagarde’s lawyer Yves Repiquet commented in a TV interview. “I will recommend Mrs Lagarde appeal this decision.”
Details on Christine Lagarde and Bernard Tapis case
The French court accuses Christine Lagarde of “negligence by a person in a position of public authority” regarding her role in the giant compensation award to Bernard Tapie, who supported Sarkozy in the 2007 presidential election in France.
The legal case revolves around Tapie’s sale of his majority stake in Adidas in 1993 to take care of a possible conflict of interest when he became a minister in the Socialist government.
Some time later Tapie sued the Crédit Lyonnais bank, largely state-owned at the time, claiming negligence or fraud in the Adidas share sale, accusing it of intentionally undervaluing the sport apparel maker’s shares.
The case would through the French court system until it came to Lagarde, who was Sarkozy’s finance minister at the time, and she assigned it to a three-person arbitration panel, which awarded Tapie over €400m in compensation and interest in 2008.
The payment to Tapie came out of public funds, and caused a major scandal. However, a French court overruled the earlier award just a few weeks ago, and has ordered Tapie to pay back the €400m with interest.
According to several sources, French authorities are investigating whether Tapie was given a lucrative deal in return for supporting Sarkozy in the election
The French Cour de Justice de la Republique, which deals with criminal allegations against government officials, decided to move ahead with a trial for Lagarde despite a lower court recommending to not pursue the case in 2014.
Of interest, Lagarde became the head of IMF in 2011.