French judges on Monday found International Monetary Fund managing director Christine Lagarde guilty of negligence for failing to challenge a €400 million state arbitration payout to a business tycoon in 2008 when she was French finance minister.

Despite the ruling the judges did not give any sentence in the case on her decision to allow the rare out-of-court arbitration payment. She has denied the negligence charges.

Her lawyer said immediately after the ruling that his team would look into appealing the decision.

The ruling risks triggering a new leadership crisis at the International Monetary Fund after Ms Lagarde’s predecessor Dominique Strauss-Kahn resigned in 2011 over a sex assault scandal.