Christine Lagarde, the chief of the International Monetary Fund, was placed under official investigation today for negligence in a French corruption probe that dates back to her days as France's finance minister. In a statement after a fourth round of questioning before magistrates, Lagarde said she would return to her work in Washington later in the day and said the decision was "without basis." She and her former chief of staff face questions about their role in a $531 million payment to businessman Bernard Tapie.
The payment was made in arbitration over a dispute with state-owned bank Credit Lyonnais over the botched sale of Adidas. Critics have said the deal was too generous and was symptomatic of the cozy relationship between money and power in France. "After three years of proceedings, dozens of hours of questioning, the court found from the evidence that I committed no offense, and the only allegation is that I was not sufficiently vigilant," Lagarde said in her statement. Under French law, the official investigation is equivalent to preliminary charges, meaning there is reason to suspect an infraction. Investigating judges can later drop a case or issue formal charges and send it to trial.