French police have arrested the CEO of France’s Orange (formerly France Telecom), Stéphane Richard as part of an ongoing investigation into a business corruption scandal.
He was arrested after arriving at court for a scheduled hearing into the scandal.
The affair doesn’t involve Orange, but Stéphane Richard was the chief of staff to Finance Minister Christine Lagarde (now head of the IMF) at the time of a dispute between businessman Bernard Tapie and Paris-based bank Crédit Lyonnais over the 1993 sale of Germany’s Adidas.
Tapie was a majority shareholder in Adidas in 1993 and has alleged the company was sold without his prior knowledge.
Then Finance Minister, Christine Lagarde referred the dispute to an arbitration court, which awarded unexpectedly high damages, and unusually quickly. It has been claimed that the ruling was related to Tapie’s support of future French President, Nicolas Sarkozy.
The revelations surrounding the dispute and how the arbitration have been handled has become a political scandal in the past few months.
Richard can be held by the police for up to 48 hours before a decision has to be taken whether he should be charged.
There are reports that the government, which still owns a substantial stake in the phone company is pushing for the CEO to step aside while the investigation is ongoing.