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October 28, 2020

IMF head Lagarde faces finance deal probe

The investigation will focus the new IMF chief’s role in a much-criticized USD 400 M arbitration deal in favour of a controversial tycoon.

Gerard Palisse, center, the president of the commission of the Republic Court of Justice, addresses the media outside the court in Paris, yesterday. A French court on Thursday ordered an investigation into new IMF chief Christine Lagarde’s role in a much-criticized $400 million arbitration deal in favor of a controversial tycoon. Lagarde was France’s finance minister when magnate Bernard Tapie won a settlement in 2008 with a French state-owned bank over the mishandled sale of sportswear maker Adidas in the 1990s. The court made the decision after meeting for several hours to discuss a preliminary inquiry. Lagarde denies misconduct. There is no suggestion she profited personally. Correspondents say the move is embarrassing for Lagarde, who has been in the job for one month, but no indication of her guilt or otherwise.

Prosecutors say Lagarde abused her authority by approving a EUR 285 M payment to businessman Bernard Tapie, a former left-wing minister who switched sides to support Nicolas Sarkozy in the 2007 presidential election.

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