FRANCE’S PUBLIC prosecutor has asked for a full-scale judicial inquiry into the role played by finance minister Christine Lagarde in a €285 million legal settlement with a prominent businessman in 2008.
Public prosecutor Jean-Louis Nadal said there were “numerous reasons to question the regularity, and even legality, of the arbitration settlement”.
Ms Lagarde is accused of having overstepped her authority when she advised the government to settle a long-running legal battle with businessman Bernard Tapie and approved an arbitration procedure which led to a €285 million settlement.
The opposition Socialist Party has strongly criticised the government’s settlement with Mr Tapie, a former government minister, football club owner and convicted match-fixer who went on to have a successful TV career.
Mr Tapie sued the state for compensation after the sale of his stake in sports company Adidas by then state-owned bank Crédit Lyonnais in 1993.
He alleged the bank defrauded him because the final sale price was higher than he had been led to believe. A French court initially ruled against Mr Tapie in 2006 but the case was still open when Mr Sarkozy became president in 2007.
To bring the long-running saga to a swift conclusion, Ms Lagarde agreed to drop the judicial proceedings against Mr Tapie and submit it to a private three-member arbitration panel.
The arbitration panel subsequently awarded Mr Tapie substantial damages. Ms Lagarde and Crédit Lyonnais, now part of Credit Agricole, have denied any wrongdoing.
The Cour de Justice de la République, a public sector court, will have to rule within a month on whether the request is admissible. Only then would a full-scale investigation take place.
Ms Lagarde’s office played down the prosecutor’s request yesterday, describing it to Agence France Presse as “a routine part of [judicial] procedure”.
She has previously insisted Mr Tapie was treated “without exception, without privilege”, adding that the settlement was a “good decision in the interest of the state”.