Prosecutors grill IMF chief for second day

Lagarde arrives at the Court of Justice in Paris yesterday to face a second day of questioning over her role in a large payout to a businessman in 2008, when she was France’s finance minister.

AFP/Paris

IMF chief Christine Lagarde’s future was at stake yesterday as French prosecutors grilled her for a second day to decide if she should be charged over a state payout to a disgraced tycoon when she was finance minister.

Lagarde was questioned for 12 hours on Thursday by prosecutors working for a court that probes cases of ministerial misconduct over her 2007 handling of a scandal that resulted in 400mn euros ($515mn) being paid to controversial business figure Bernard Tapie.

Lagarde has downplayed the investigation, but the stakes are high for both her and the International Monetary Fund (IMF), which has expressed confidence in its first woman leader.

She could be named an assisted witness, whose status falls between that of simple witness and being placed under formal investigation – the closest equivalent in French law to being charged – and implies there is some evidence against the person questioned.

But she would not be automatically forced to resign from the IMF if she is charged.

The chic Lagarde, considered one of the world’s most powerful women, won respect as France’s first female finance minister for her no-nonsense attitude, intellect and style.

The investigation concerns Tapie, a former politician, who went to prison for match-fixing during his time as president of French football club Olympique de Marseille.

Prosecutors working for the Court of Justice of the Republic (CJR) suspect he received favourable treatment in return for supporting Nicolas Sarkozy in the 2007 presidential election.

They have suggested Lagarde – who at the time was finance minister – was partly responsible for “numerous anomalies and irregularities” which could lead to charges for complicity in fraud and misappropriation of public funds.