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IMF executive board expresses confidence in Christine Lagarde

WASHINGTON -- The executive board of the International Monetary Fund expressed confidence Friday in IMF Managing Director Christine Lagarde after receiving a briefing on a French corruption probe in which Lagarde is being investigated.

In a brief statement, the 24-member board said it continues to have “confidence in the managing director's ability to effectively carry out her duties.”

Lagarde called the investigation “without basis” after answering questions before magistrates in Paris on Wednesday. She and her former chief of staff are facing questions about their role in an arbitration ruling that handed 400 million euros (US$531 million) to French businessman Bernard Tapie.

Tapie had sued French bank Credit Lyonnais for its handling of the sale of his majority stake in sportswear company Adidas in the mid-1990s.

In her statement Wednesday, Lagarde said that after three years of proceedings and dozens of hours of questioning, the court had found no evidence that she had done anything wrong and that the only remaining allegation “is that I was not sufficiently vigilant.”

She said she was returning to Washington and her work at the IMF.

Under French law, the action to put Lagarde under official investigation is equivalent to a preliminary charge, which means there is reason to suspect an infraction. Investigating judges can later decide to drop the case or issue a formal charge and send the matter to trial.

In its statement, the IMF board said, “It would not be appropriate to comment on a case that has been and is currently before the French judiciary.” But the statement said the board wanted to express its continued confidence in Lagarde's abilities to carry out her duties.

The 24-member executive board is responsible for the day-to-day operations of the IMF. It represents the 188 nations that are members of the international lending organization. The largest economies, such as the United States, have their own board seat, while smaller countries are represented by directors who speak for a group of countries.

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