Christine Lagarde, the International Monetary Fund’s new managing director has landed in trouble only a month after getting her new job. Her name popped up in the news yesterday when a special French court ordered an investigation into a $400 million settlement paid to a billionaire when she was the French Finance Minister. She denies any impropriety.
Which brings us to Madame Lagarde’s salary in these tough times. As the first woman to serve as the managing director of the non-profit IMF, Lagarde has broken all records in salary compensation at the institution, of which the U.S. is the largest contributor. She exceeded the stratospheric salary and perks of her immediate predecessor, Dominique Strauss Kahn. DSK abruptly resigned earlier this year and is currently free on his own recognizance in the United States for sexually assaulting a hotel maid in New York.
According to IMF records, Ms. Legarde will receive $468,000 in tax free salary, plus an extra $84,000 in an “allowance. ” This is more than DSK, who only received $421,000 in salary and a measly $75,000 in allowances. She will receive $45,975 per month in tax free income.
Both Lagarde and DSK earn nearly three times the $179,000 salary the U.S. Government pays Federal Reserve Chairman Ben Bernanke. High salaries are notorious at the IMF and at its sister organization, The World Bank. Both are supposed to be non-profit organizations but you wouldn’t quite know it from the executive salaries.
When Congress reconvenes in the fall some members of Congress may examine the high IMF and World Bank salaries to determine if they are excessive.