PARIS--French authorities Wednesday placed France Telecom SA
(FTE.FR) Chief Executive Stephane Richard under formal
investigation for his alleged role in a controversial arbitration
ruling made in 2008, when he worked at the French Finance
Ministry.
Investigating magistrates pressed preliminary charges of
conspiracy to commit fraud against Mr. Richard for his alleged
actions surrounding the arbitration panel and its decision to grant
a 420 million euro ($557.5 million) award from the French Treasury
to business tycoon Bernard Tapie.
A lawyer for Mr. Richard, Jean-Etienne Giamarchi, did not
immediately respond to a request for comment. Representatives for
France Telecom were not immediately available for comment.
Mr. Richard has repeatedly defended his actions in the matter,
telling The Wall Street Journal in January that he had been "trying
in good faith to defend the state's best interests."
The decision to put Mr. Richard under formal investigation could
eventually lead to formal charges, a trial and criminal penalties
for the France Telecom chief. Investigating magistrates could also
decide to abandon the inquiry after further digging.
Write to Sam Schechner at sam.schechner@dowjones.com
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