PARIS — A French court ordered Christine Lagarde, the managing director of the International Monetary Fund, on Friday to face a criminal trial on charges of
negligence dating to her time as finance minister, threatening to overshadow
her second term at the helm of the organization.
France’s highest appeals court rejected an effort by
Ms. Lagarde to have the case dismissed, setting the stage for a lengthy legal
process that will most likely require her to spend more time in Paris, away
from her duties in Washington.
The I.M.F. did not comment on whether Ms. Lagarde, who
is the first woman to lead the organization, would need to recuse herself from
her position during the trial. But in a statement on Friday, it said its executive board had been briefed on the situation
and continued “to express its confidence” in Ms. Lagarde’s ability to carry out
her duties. “The board will continue to be briefed on this matter,” the
statement said.
Ms. Lagarde is accused of negligencewhile overseeing a politically charged 2007
arbitration case in which Bernard Tapie, a French tycoon close to Nicolas
Sarkozy, who was president at the time, was awarded more than 400 million
euros, or $440 million at current exchange rates, to settle a dispute with the
state-owned bank Crédit Lyonnais.
Mr. Tapie, a former leader of the Adidas sports empire
and a minister in the Socialist government of President François Mitterrand in
the early 1990s, switched political allegiances to support Mr. Sarkozy’s
presidential campaign in 2007. French investigators have been looking into
whether Mr. Tapie was offered any kind of a deal in return for his support, and
whether Ms. Lagarde may have been acting on Mr. Sarkozy’s orders by sending the
case to an arbitration panel.
The large payout
ignited a public outcry at the time, and Ms. Lagarde came under scrutiny for
her role after she declined her advisers’ recommendations to appeal the
decision.
She was eventually investigated for “abuse of
authority” after failing to appeal the payout, but that charge was dropped. She
now faces a lesser charge of “negligence by a governmental official,” punishable
by one year in prison and a fine of €15,000.
The Court of Justice of the Republic, where Ms.
Lagarde will stand trial, is rarely used. The cases before the 15-member body
have mostly involved politicians, as former ministers are sometimes brought to
trial when a new government takes over.
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