PARIS, Dec. 19 (UPI) -- International Monetary Fund chief Christine Lagarde escaped jail time but was found guilty of negligence in a misuse of funds case, a Paris judge ruled Monday.
A guilty verdict could have forced Lagarde, 60, to leave her post as the IMF's managing director. The verdict by the Court of Justice of the Republic, a court which exclusively tries cases pertinent to French politics and government, leaves her without punishment or a criminal record. She could have received a $13,000 fine and a one-year prison sentence.
The trial concerned her decision in 2007, as France's finance minister, to allow a dispute over the sale of the Adidas sports brand to Credit Lyonnais bank to be resolved through a rarely-used private arbitration panel, instead of through the courts. She was also accused of neglecting to challenge the $421 million award to Adidas part-owner Bernard Tapie. The bank was, in part, government-owned at the time, and Tapie accused the bank of cheating him when it managed the 1993 sale of his share of the company. The accusation was followed by years of legal battles.
The court Monday said no crime was committed in approving the arbitration, but Lagarde was guilty of "negligence" in not appealing its decision.
The payout to Tapie came from an illicit agreement by which the long-running claim of damages would be resolved through Tapie's support to the re-election campaign of then-president Nicolas Sarkozy, court testimony said. Lagarde was suspected of approving a deal by which Tapie was bought off by taxpayer money. She denied she was involved in the arrangement, saying she may have been misled by civil servants and that the potential for fraud "totally escaped me."