IMF chief awaits verdict in negligence trial

intern

December 19, 2016 2:15 PM

Lagarde could face up to a year in prison and a fine of 15,000 Euros (15,665 dollars), if found guilty.

IMF chief Christine Lagarde (C) has been charged with negligence over the settlement with tycoon Bernard Tapie

Christine Lagarde Head of the International Monetary Fund (IMF) was on Monday awaiting the verdict in a trial over an arbitration payout made when she was France’s finance minister.

Prosecutors in the case have called for her acquittal and her defense lawyers have expressed confidence in the outcome to be handed down by a special court charged with trying former ministers.

A guilty verdict will also cast doubt over her position at the head of one of the world’s most powerful financial institutions.

Lagarde has denied wrongdoing over the payout ruling, which was handed down by a three-person arbitration panel in 2008.

In 2007, Lagarde gave the go-ahead for arbitration in the case of business mogul Bernard Tapie and a public consortium in charge of former state-owned bank Credit Lyonnais’ liabilities.

The panel awarded 403 million Euros to Tapie, an amount critics said was too high.

Some speculated that he got it because of his political connections, including the then president Nicolas Sarkozy.

In February 2015, the Court of Appeal of Paris overturned the arbitration award issued to Tapie because of connections between Tapie’s lawyers and one of the members of the arbitration panel.

Speaking to the court recently, Lagarde said that she had acted in her conscience and had not foreseen the risk of potential fraud by one of three esteemed jurists.

Her defense team said that she had consulted with lawyers before deciding not to appeal the ruling, and added that there was no reason to doubt the arbitration panel members.

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