French appeals court rules IMF chief Christine Lagarde must face Bernard Tapie payout trial

Caitlin Morrison
Follow Caitlin
Christine Lagarde And Jim Yong Kim Address IMF-World Bank Group Annual Meetings
Lagarde has been ordered to stand trial (Source: Getty)

The French appeals court ruled today that IMF boss Christine Lagarde must stand trial over allegations that she was negligent in her handling of a controversial payout during her time as French finance minister.

The trial relates to a €404m (£340m) payment made to French business tycoon Bernard Tapie in 2008, when Lagarde was finance minister under former President Nicholas Sarkozy.

Lagarde is accused of improperly signing off on the decision to allow an extremely rare out-of-court arbitration between Tapie and the state - Tapie had sued the state for compensation after selling his stake in Adidas to now-defunct bank Credit Lyonnais in 1993.

The final settlement is alleged to have been rigged because of Tapie's support of then-president Nicolas Sarkozy.

Lagarde's lawyer Patrick Maisonneuve said today that he was convinced the trial would show she was innocent.

Lagarde was originally ordered by a French court to face trial over the allegations in December 2015, but she went on to appeal that decision.

At the time, Lagarde's lawyer Yves Repiquet told French TV channel iTele that the decision was "incomprehensible".

The IMF boss was put under formal investigation by the French courts in August 2014. She has insisted throughout the process that she is innocent of playing any "improper" role in the payout process.

Orange chief executive Stephane Richard was also investigated by French police in connection with the Tapie payout. Richarde was Lagarde's chief of staff when she was finance minister.

Tapie has been ordered to repay the €404m to the French state, but an appeal lodged by the businessman is still pending.