French minister facing judicial inquiry

Christine Lagarde, France's Finance Minister, is facing a judicial inquiry into her role in awarding financial compensation to a former tycoon and urban affairs minister who is close to President Nicolas Sarkozy.

The French public prosecutor said there were "numerous reasons to question the regularity, and even legality, of the arbitration settlement".

Lagarde dropped a long-running judicial battle in 2007 with Bernard Tapie, the former president of Marseille football club.

Instead she approved an arbitration procedure that led to a €285 million ($515 million) settlement in his favour, plus €100 million in interest and €45 million for "moral damage".