By James McAuley
A French court Monday found International Monetary Fund (IMF) chief Christine Lagarde guilty of criminal negligence linked to a government payout to a tycoon eight years ago while she served as finance minister.
But Lagarde will not face punishment or fines, and she vowed to try to appeal the decision by the special tribunal.
It was unclear whether the ruling could have spill over on her leadership of the International Monetary Fund. But the court’s soft touch on applying the ruling — including not recording it her criminal record — suggested limited direct fallout on Lagarde’s IMF duties.
One of her lawyers, Christopher Baker, told the Associated Press that “there is no sentence, which means there’s no record of this.”
During her tenure as France’s finance minister, the court ruled Lagarde failed to thwart a 285 million euro ($297 million) government payout to the French businessman Bernard Tapie in 2008.
The so-called Tapie Affair has been a fixture of French politics for more than a decade.
Tapie, once the major shareholder in the sporting goods company Adidas, had to sell the company in 1993 to avoid conflicts of interest before taking a position in the cabinet of France’s then-president, François Mitterand.
But the following year, Tapie alleged that Credit Lyonnais, the partially state-owned bank that had overseen the transaction at the time, deliberately devalued his company and defrauded him of millions in the process. Tapie sold Adidas for 315 million euros; it was resold the next year for more than double that price.
The case then carried on for years until 2007, when Lagarde, then France’s finance minister, referred it to private arbitration. In 2008, the panel approved a payout of hundreds of millions to the businessman and former actor that would cover most of the difference.
A French court has since ruled that Tapie was not entitled to the compensation, and Lagarde was subsequently accused of “negligence with public money.”
Lagarde, 60, had faced up to one year in prison and a fine of 15,000 euros. But one of the presiding judges said Monday that the defendant would face neither and would not have a criminal record.
On Friday in Paris, Lagarde insisted that she had acted in good faith and called the trial, which had spanned five years, an “ordeal” for her family and former colleagues. She was in Washington, the headquarters of the IMF, when the verdict was issued.
Lagarde took over the International Monetary Fund in 2011 from Dominique Strauss-Kahn, a former French finance minister who was accused of sexually assaulting a hotel maid in New York. Those charges were later abandoned.
The IMF is a major player in global finances, offering packages and oversight to debt-choked nations including Greece, Pakistan and Portugal.
In addition to Lagarde, another former IMF chief, Rodrigo Rata, is presently standing trial alongside 64 other bankers