PARIS: IMF chief Christine Lagarde was ordered on Friday to stand trial in France over a massive state payout to a colourful tycoon when she was French economy minister, dealing a setback to her career.

France’s highest appeals court dismissed Lagarde’s challenge against the decision to try her for negligence in her handling of a dispute between a state-owned bank and businessman Bernard Tapie.

Tapie walked away with a staggering $445 million in compensation in 2008 after Lagarde ordered the long-running row over the sale of Adidas to be resolved by arbitration.

Tapie claimed he was defrauded by Credit Lyonnais bank, which handled the sale of the sportswear giant that he owned between 1990 and 1993.

Friday’s ruling means 60-year-old Lagarde will go before a special tribunal that hears cases against government ministers accused of wrongdoing in the discharge of their duties.

If convicted, she risks up to a year in prison and a fine of 15,000 euros. No date has been set yet for the trial.

The ruling is a blow to the IMF boss, who became the first woman to head the IMF when she replaced Dominique Strauss-Kahn in July 2011.

She has been touted as a possible French presidential contender, though she denies any ambitions to hold the job.

The ruling comes two days after she began her second term as head of the IMF, where she has been hailed as both a tough negotiator and a skilled consensus-builder.

She insists she acted in France’s best interests in the Tapie affair, and the IMF has expressed firm backing for her.

Published in Dawn, July 23rd, 2016