IMF chief charged with Sexual Assault

IMF chief charged with Sexual Assault
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IMF chief charged with Sexual Assault

FROM THE - JOURNALS of Monte Friesner ~ Financial Crime Consultant for WANTED SA

News Bulletin: Monday May 16, 2011 >

IMF chief Dominique Strauss-Kahn was charged Sunday with trying to rape a New York hotel maid in a scandal that appeared to wreck his hopes of becoming France's next president.

The sexual assault charges throw the IMF into a leadership crisis just as it is trying to help ease an escalating euro zone debt crisis, and they turn France's presidential election campaign upside down when polls had made Strauss-Kahn a clear front runner.

The charismatic 62-year-old, who led the International Monetary Fund through the 2007-09 global financial meltdown and has been central in galvanizing Europe to tackle its debt woes, for long had the reputation of a womanizer. But the charges he faces are in another realm.

A maid, 32, said he emerged naked from the bathroom and sexually assaulted her inside his $3,000-a-night suite at the Sofitel hotel in New York's Times Square Saturday afternoon. He was there on private business, the IMF said.

Strauss-Kahn was expected to go before a state court later Sunday. His lawyer said he will plead not guilty.

Police say he fled the hotel after the alleged assault and a few hours later they pulled him out of his first-class seat on an Air France plane 10 minutes before it was to take off for Paris.

He was charged with a criminal sexual act, unlawful imprisonment and attempted rape, moving him from luxurious hotel suite and a glittering public career to scandal and a bare holding cell in New York's tough Harlem neighborhood in the space of a few hours.

The contrast could barely have been more dramatic. At the Sofitel, Strauss-Kahn's suite had a conference room, living room, foyer, spacious marble bathroom and a bedroom with a sumptuous king-sized bed and feather and down duvet.

Police say Strauss-Kahn does not have diplomatic immunity from the charges, which if proven could carry a prison sentence of 15-20 years. They have collected DNA evidence from the hotel suite, The New York Times reported.

Strauss-Kahn has hired New York lawyer Benjamin Brafman, a seasoned defense attorney famed for striking deals or winning not-guilty verdicts for pop stars and a football player.

The IMF chief's wife, well-known French television personality Anne Sinclair, jumped to her husband's defense.

"I do not believe for a single second the accusations leveled against my husband," she said in a statement.


The IMF tried to fill its leadership vacuum by naming its No. 2 official, John Lipsky, as acting managing director. But the charges against Strauss-Kahn are a huge embarrassment for an institution that oversees the global economic system and has authorized hundreds of billions of dollars of lending to troubled countries as well as playing a major role in the euro-zone debt crisis.

The allegations immediately threw France's presidential race wide open.

He had not yet declared his candidacy but Strauss-Kahn was widely expected to run for the Socialist Party and early opinion polls showed him with a big lead over the conservative incumbent, Nicolas Sarkozy, who is seeking a second term at the election next April.

"The news we received from New York last night struck like a thunderbolt," said Socialist leader Martine Aubry, appealing for party unity.

France's government as well as Strauss-Kahn's political allies and rivals called for caution and respect for the presumption of innocence, but his presidential ambitions appeared to be dead in the water unless the case against him quickly unravels and he is shown to be innocent.

"All this is completely astounding, immensely troubling and distressing. If the facts prove true ... it's something degrading for all women. It's terrible for the image of France," said Francois Bayrou, a centrist opponent.

Far-right leader Marine Le Pen said her rival's presidential hopes had been crushed.

Christine Boutin, president of the Christian Democrat Party, suggested Strauss-Kahn may have been set up.

"I think it's very likely a trap was set for Dominique Strauss-Kahn and he fell into it," she told France's BFM television. "It's a political bomb for domestic politics."

French voters are famously tolerant of political leaders' extra-marital affairs but the allegations against Strauss-Kahn are entirely different, and much more serious.

If they are proven, Strauss-Kahn's fall from power in a scandal would be one of the most dramatic of any high-profile international figure in decades.

Many politicians have fallen after being caught in extra-marital affairs and others have survived them, including former U.S. presidents John F. Kennedy and Bill Clinton as well as former French President Francois Mitterrand.

But rarely have senior figures faced brutal assault charges like those filed against Strauss-Kahn.

With Strauss-Kahn in the dock, the IMF also now faces many questions of its own, because his character had been questioned before.

In 2008, Strauss-Kahn apologized for "an error of judgment" after an affair with a female IMF economist who was his subordinate.

The Fund's board of member countries warned him against further improper conduct, but cleared him of harassment and abuse of power and kept him in his job. It will now face new scrutiny over whether that response was too weak, especially as there have been persistent rumors about Strauss-Kahn making sexual advances to women.


An economics professor and former French finance minister, Strauss-Kahn took over the IMF in November 2007 for a five-year term, and won praise for helping galvanize leaders to inject billions of dollars into the world economy during the global financial crisis.

He introduced sweeping changes to ensure vulnerable countries swamped by the crisis had access to emergency loans, and others to give major emerging market countries such as China, India and Brazil greater voting powers in the IMF.

Witty, multi-lingual, a skilled public speaker and sharp back-room negotiator, Strauss-Kahn also weighed into thornier issues by urging China to let its currency rise in a dispute with the United States.

A crisis of leadership at the Fund now will especially worry European nations given Strauss-Kahn's pivotal role in brokering bailouts for Iceland, Hungary, Greece, Ireland and Portugal.

"The chances are the successor won't be a European, and will want to rebalance the IMF's priorities away from its massive commitment in Europe," said Jean Pisani-Ferry, director of the Bruegel economic think-tank.

Strauss-Kahn had been due to meet German Chancellor Angela Merkel Sunday and join euro zone finance ministers Monday to discuss the bloc's debt crisis and how to handle Greece, which is struggling to meet the terms of a 110 billion euro European Union/IMF bailout last year.

"This might definitely cause some delays in the short term," a Greek official told Reuters on condition of anonymity.

Strauss-Kahn's lawyers moved quickly to cast doubts on the allegations against him.

"We must wait until things settle and see if it's true or a provocation," said one of his France-based lawyers, Leon Lef Forster. "We must be especially careful not to get into a media circus and we must wait until things are clear."

Brafman, his U.S. lawyer, previously defended pop star Michael Jackson against child molestation charges as well as other celebrities in trouble.

The maid who accused Strauss-Kahn told police he attacked her when she went in to clean his suite.

"She told detectives he came out of the bathroom naked, ran down a hallway to the foyer where she was, pulled her into a bedroom and began to sexually assault her, according to her account," New York police spokesman Paul Browne said.

"She pulled away from him and he dragged her down a hallway into the bathroom where he engaged in a criminal sexual act, according to her account to detectives. He tried to lock her into the hotel room."

The woman, who has not been named, was treated in hospital for minor injuries, Browne said. She has worked at the hotel for three years and the property's manager said Sunday she has been a "completely satisfactory" employee in her work and her behavior.

Under New York state law, attempted rape and criminal sexual act both carry a potential sentence of 15-20 years. Unlawful imprisonment carries a potential sentence of three to five years. (Reporting by Christine Kearney and John Irish; Additional reporting by Michelle Nichols, Lesley Wroughton, Noeleen Walder, Basil Katz, Edith Honan, Andrew Longstreth, Brian Love, Catherine Bremer and John Irish)

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