It recently came to light that the European Central Bank’s President, Christine Lagarde, previously served as director of two affiliates that operated in tax havens.
Lagarde worked for Baker & McKenzie, a legal firm, and served on the board of subsidiaries in Singapore and Bermuda from 2003 to 2005. The company that Lagarde directed belonged to Baker & McKenzie and its Bermuda location means that it was in a region that was part of the tax haven blacklist that the European Union followed at the time. Additionally, Lagarde served on the board of a business that has connections to the same international company but in Singapore, which also had banking secrecy laws during the time.
This relationship with tax haven all came with Lagarde’s partner status at Baker & McKenzie, the international law firm. The Bermuda-based company in question, Law in Context Ltd, listed Lagarde as the director until 2005.
Research by El Pais
Lagarde’s involvement with and crucial leadership roles in companies located in tax havens recently resurfaced due to research conducted by El Pais. The newspaper found that the holding headed by Lagarde had its registered address in Bermuda’s capital of Hamilton at 41, Cedar Avenue. Interestingly enough, the newspaper also discovered that multiple additional offshore companies list this address.
A Baker & McKenzie spokesperson told El Pais that the holding in question, Law in Context Ltd, was created following Bermuda’s corporate laws and following the same common practices as other international companies. The difference was that Law in Context Ltd faced financial problems and did not find itself stock exchange listed.
What Those in the Know Say
Those who are close to Lagarde indicated that she did not have any economic interest in Law in Context Ltd’s activity beyond a minimal amount due to her role as partner. The sources in question told El Pais that when she entered the French government, she lost even that minuscule interest. Those sources clarified that Lagarde never benefited from illegal advantages or had accounts in tax havens.
Lagarde’s History After the Tax Havens
Some argue that Lagarde’s connections to tax havens are not relevant since they are not recent. In 2005, Lagarde left Law in Context Ltd to become the French Foreign Trade Minister under Prime Minister Dominique de Villepin. In 2011, she eventually became the International Monetary Fund’s managing director, before she moved on to her current role as president of the European Central Bank.
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