Orange Chief Executive Stephane Richard was placed under investigation on Wednesday (June 12) for his role in a 2008 arbitration case that resulted in a 285 million euro (£242 million) payout to a businessman, a spokesman for the CEO said.
Richard has been questioned for the past two days by investigating magistrates over the payout to Bernard Tapie that he helped negotiate as chief of staff to former finance minister Christine Lagarde.
Tapie, a supporter of former president Nicolas Sarkozy, contested the bank's role in the sale of his stake in sports clothing firm Adidas in 1993.
Richard has denied any wrongdoing in the case.
The corruption probe has put Richard, whose contract at the state-backed France Telecom is up for renewal next year, in a delicate position with the government, which owns 27 percent of the group and chooses its chief executive.
The Socialist government has not yet replaced any of the bosses of the major state-owned companies such as utilities EDF or GDF, but could move on Richard if the Tapie case is seen as preventing him from carrying out his duties.
Presented by Adam Justice