Investigators search Paris home of IMF chief

AP News
Posted: Mar 20, 2013 12:45 PM
Investigators search Paris home of IMF chief

PARIS (AP) — A lawyer for IMF chief Christine Lagarde says French investigators have searched her Paris home as part of an inquiry into her role in a $400 million arbitration deal in favor of a tycoon.

The lawyer, Yves Repiquet (eev ruh-PEE-kay), says Lagarde has nothing to hide and welcomed Wednesday's search as another step in proving her innocence.

Lagarde was France's finance minister when magnate Bernard Tapie won a 2008 settlement with a state-owned bank over the mishandled sale of Adidas in the 1990s. Critics said the settlement was too generous.

IMF spokesman Gerry Rice said the organization's executive board had discussed the issue prior to Lagarde's appointment in June 2011, "and expressed its confidence that Madame Lagarde would be able to effectively carry out her duties as managing director."

Rice declined further comment, saying it would be inappropriate to say more about a case currently before the French judiciary.

Critics in France have said the Adidas case shouldn't have gone to a private arbitration authority in the first place because it involved a state-owned bank, Credit Lyonnais, and that Lagarde should have questioned the independence of one of the arbitration panel's judges.

Questions about the settlement began before Lagarde was appointed head of the Washington-based International Monetary Fund after her predecessor, Dominique Strauss-Kahn, quit to face charges he tried to rape a New York hotel maid. The charges against Strauss-Kahn were dropped.

During Lagarde's four-year tenure as France's finance minister, she won praise for her role in international negotiations during the global financial crisis and Europe's debt troubles.

Given the legal troubles of her IMF predecessor, Strauss-Kahn, Lagarde's contract says she is "expected to observe the highest standards of ethical conduct" and "shall strive to avoid even the appearance of impropriety in your conduct."