The trial of Christine Lagarde, the managing director of the International Monetary Fund (IMF), has reached a new boiling point as the former French finance minister has been forced by court to clarify a “colossal” payout she made in 2008 to a business tycoon.

Presiding Judge Martine Ract Madoux asked Lagarde on the second day of her trial on Tuesday to explain justifications behind the payout of 45 million euros ($48 million) to Bernard Tapie as part of a settlement with the former owner of sportswear giant, Adidas.

The judge said the figure was “colossal” and much higher than a normal payout meant to compensate plaintiffs over moral damages. “The heart of this case are the moral damages of 45 million euros, even though… moral damages for the death of a child are between 30,000 and 50,000 euros. Ultimately, it’s a colossal figure,” said Ract Madoux.

Lagarde ordered the payout one year after she became finance minister under France’s former President Nicolas Sarkozy. The IMF managing director sought to settle through arbitration the dispute with Tapie over the purchase of Adidas in 1993 by a state-owned bank. However, many say Tapie had benefited from his personal links to Sarkozy during arbitration as he finally managed to walk away with 404 million euros as settlement. The former minister, who is currently 73, was later ordered by a court to repay the money.

Lagarde has been charged with negligence in the settlement case. She said during the trial on Tuesday that her questioning over the figure would not have altered the case. However, the judge argued that Lagarde should have reacted to the entire process at the time as the figure was like a “punch in the stomach.” Lagarde, the third IMF chief to face trial, could receive a maximum one-year prison sentence and a 15,000-euro ($15,900) fine if found guilty.

Presstv