Lagarde Has G8 Backing; Hits Back At Inquiry Call

By Helen Massy-Beresford and Yves Clarisse

PARIS

(Reuters) - G8 leaders all back French Finance Minister Christine Lagarde's bid to run the IMF, Foreign Minister Alain Juppe said on Sunday, as the candidate attacked a call to investigate her role in a 2008 legal case that may harm her chances.

France was careful not to speak out about Lagarde's candidacy during a Group of Eight summit in Deauville last week but Juppe said all eight nations were firmly behind Lagarde.

"Among the eight heads of state and government, plus the president of the European Commission and the president of the European Council who were there, there was unanimous support for Christine Lagarde," Juppe said on Canal+ television.

The top IMF job is vacant after Dominique Strauss-Kahn quit over attempted rape charges in New York, which he has vowed to fight.

The United States on Sunday stuck with its policy of not announcing support for a specific candidate.

"I won't go beyond what we've said which is that we support the process that's been set up by the IMF to find a successor and we support a process that produces the best possible candidate," said Jay Carney, spokesman for President Barack Obama.

The main obstacle in Lagarde's way is the possibility of an inquiry into her role in a 2008 legal settlement involving paying 285 million euros (247.5 million pounds) to businessman Bernard Tapie, an ally of French President Nicolas Sarkozy.

Opposition Socialist Party politicians have accused Lagarde of abusing her authority when she awarded the money to Tapie.

Lagarde, who flies to Brazil Sunday to drum up key emerging economy support for her IMF bid, questioned the legal and factual basis of the public prosecutor's call for a formal inquiry into her role in the Tapie case, saying some aspects were false in an interview with Europe 1 radio.

She has said her conscience is clear over the case.

Tapie, a former left-wing government minister who switched sides to support Sarkozy's 2007 presidential campaign, was paid to settle a legal dispute with a state-owned bank.

He had accused former state-owned bank Credit Lyonnais of defrauding him during the sale of his stake in sports giant Adidas in 1993 because the final sale price was higher than he had been led to believe.

A French court initially ruled against Tapie in 2006 but the case was still open when Sarkozy won office in 2007.

Bringing the saga to a close, Lagarde agreed to drop the judicial proceedings and submit the case to a private three-member arbitration panel, overruling some in her ministry who argued that it should remain in court.

Lagarde needs support for her IMF candidature from emerging economies which have criticised EU officials for suggesting the new head must be a European.

The only other declared candidate is Mexican Central Bank Governor Agustin Carstens.

(Reporting by Yves Clarisse and Helen Massy-Beresford; Editing by Louise Ireland)