International Monetary Fund (IMF) Managing Director, Christine Lagarde has vowed to challenge every allegations of negligence leveled against her for approving $424 million payout to businessman Bernard Tapie in eight years ago.
LagardE who was France’s finance minister in the government of the country’s former president, Nicolas Sarkozy, when she approved an out-of-court settlement with Tapie to end a long-running dispute between the magnate and the French state.
At the Court yesterday, Lagarde denies any wrongdoing, saying I would like to show you that I am in no way guilty of negligence, but rather that I acted in good faith with only the public interest in mind.
Her trial is only the fifth to be held before the Cour de Justice de la Republique, a special tribunal created in 1993 to try cabinet ministers.
If found guilty, the decision of the 60-year-old to accept an extremely rare private arbitration ended up costing French taxpayers the huge fund could amount to one year jail term and a fine of $15,895
Lagarde who expressed surprise at the harsh tone of the charges against her, argued firmly that she was never negligent in her duties and that she would strive harder to convince the court on all allegations leveled against him.
Investigators had earlier argued that Lagarde’s behavior in the case went beyond simple carelessness.
On the organization of the court, the panel consists of 15-man panel including 12 lawmakers from both the lower and upper houses of parliament, will hear the case, which is scheduled to run until Dec. 20.
They are expected to focus on correspondence between Lagarde and her staff as well as the government body that manages state corporate holdings, which advised against private arbitration.
The case dates back to a time when Tapie sued the state for compensation after selling his stake in sports company Adidas to then state-owned Credit Lyonnais in 1993.
He accused the bank of defrauding him after it resold its stake for a much higher price. With the case stuck in the courts, the two sides agreed to a private settlement and Tapie was awarded a 403 million euro payout, including interest.
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