Lagarde Faces Probe in $400M Deal

Court orders look at $400M arbitration deal
By Kevin Spak,  Newser Staff
Posted Aug 4, 2011 11:17 AM CDT
In a July 26, 2011 file photo, IMF Managing Director Christine Lagarde addresses a gathering at the Council on Foreign Relations in New York.   (AP Photo/Richard Drew, File)
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(Newser) – Well, at least there’s no maid involved this time: A special French court has ordered an investigation into newly minted IMF chief Christine Lagarde, over her role in a $400 million arbitration deal with tycoon Bernard Tapie. The much-maligned settlement, awarded in 2008, came after Tapie sued a French state-owned bank over its handling of the sale of Adidas, the AP explains. Lagarde was finance minister at the time, and prosecutors suspect she overstepped her authority.

Critics say a case involving a state-owned bank never should have gone to arbitration, and question the impartiality of one judge on the panel. France’s Court of Justice of the Republic—a court convened only for matters involving government officials—today ordered an investigation into Lagarde’s role in the matter. “We'll get to the bottom of things,” Lagarde’s lawyer promised. “There will no longer be the least doubt.”

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