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Strauss-Kahn Awaits Arraignment in Sex Assault Case

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International Monetary Fund Chief, Dominique Strauss-Kahn, is placed in the backseat of a police vehicle outside of a New York City Police Department facility on W 123rd St.

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Photographer: Brian Harkin/Getty Images

International Monetary Fund Chief, Dominique Strauss-Kahn, is placed in the backseat of a police vehicle outside of a New York City Police Department facility on W 123rd St. Close

International Monetary Fund Chief, Dominique Strauss-Kahn, is placed in the backseat of a police vehicle outside of a... Read More

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Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF), third from right, is escorted by police in New York. Close

Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF), third from right, is escorted by... Read More

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Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF), is escorted by police in New York. Close

Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF), is escorted by police in New York.

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Dominique Strauss-Kahn, the head of the International Monetary Fund and a potential candidate for the French presidency next year, was charged with attempted rape and a criminal sex act on a maid in a New York hotel, the police said today. Close

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Benjamin Brafman, lawyer for International Monetary Fund Managing Director Dominique Strauss-Kahn, center, is surrounded by the media as he enters Manhattan criminal court in New York. Close

Benjamin Brafman, lawyer for International Monetary Fund Managing Director Dominique Strauss-Kahn, center, is... Read More

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Benjamin Brafman, lawyer for International Monetary Fund Managing Director Dominique Strauss-Kahn, speaks to the media as he enters Manhattan criminal court in New York. Close

Benjamin Brafman, lawyer for International Monetary Fund Managing Director Dominique Strauss-Kahn, speaks to the... Read More

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New York City Police Detective Brian Sessa, left, speaks with the media regarding a case involving Dominique Strauss-Kahn, head of the International Monetary Fund (IMF), in New York, U.S., on May 14, 2011. Close

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A New York City Police Department crime scene unit truck is parked outside of the Sofitel Hotel on May 15, 2011. Close

A New York City Police Department crime scene unit truck is parked outside of the Sofitel Hotel on May 15, 2011.

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Dominique Strauss-Kahn, managing director of the International Monetary Fund, speaks at a news conference during the IMF-World Bank spring meeting in Washington, D.C., on April 14, 2011. Close

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International Monetary Fund chief Dominique Strauss-Kahn awaits his first court appearance on attempted rape charges after giving police permission to examine him for physical evidence of scratches and DNA from his accuser.

The alleged attack on a 32-year-old female maid at a Sofitel hotel in midtown Manhattan occurred May 14, according to the New York Police Department. Strauss-Kahn, who was taken into custody aboard an Air France flight at John F. Kennedy International Airport as it prepared to depart, also was charged with unlawful imprisonment and a criminal sex act. He remains in custody until an 11 a.m. hearing in Manhattan criminal court.

A potential candidate for the French presidency, Strauss- Kahn, 62, has denied the charges and will plead not guilty, his lawyer Benjamin Brafman said. The IMF chief was picked out of a lineup yesterday by the maid, police said. His arraignment, during which bail terms may be set, had been scheduled for yesterday and was delayed after investigators sought a warrant for a physical examination of Strauss-Kahn.

The IMF “remains fully functioning and operational” following Strauss-Kahn’s arrest, the Washington-based organization said in a statement yesterday. John Lipsky, the IMF’s first deputy managing director, is serving as acting managing director, IMF spokesman William Murray said.

Strauss-Kahn had been scheduled to attend a meeting of euro-area finance ministers in Brussels today. The meeting will take place as officials discuss increasing a 110 billion-euro ($155-billion) loan package to Greece amid concerns the country may be unable to finance its debt next year.

‘Terrible News’

“For the fund, this is terrible news at a time when its leadership needs to portray stability, wisdom, and confidence,” Bessma Momani, a professor in at the University of Waterloo in Canada specializing in the IMF and its policies, said in an e- mail.

The alleged assault occurred about 1 p.m. on May 14 when the woman entered Strauss-Kahn’s $3,000-a-night suite, where he had been staying since the day before, New York police said. Strauss-Kahn is alleged to have emerged from a bathroom naked and made two attempts to forcibly have sex with the maid, New York Police Deputy Commissioner Paul Browne said.

The maid escaped and notified co-workers who called the police, Browne said. When officers arrived, Strauss-Kahn wasn’t there and his mobile phone was left behind, he said. He was later detained by Port Authority police while sitting in first- class aboard the Air France flight. He has been held in a cell in an East Harlem precinct house, where the NYPD’s Special Victims Unit is located. The unit handles sex-crime cases.

King of Pop

Nathalie Kosciusko-Morizet, France’s environment minister, said in an interview with Canal Plus that the arrest would hurt the country’s image abroad.

A former Manhattan assistant district attorney, Brafman has represented singer Michael Jackson, rapper Sean “Diddy” Combs and Salvatore “Sammy the Bull” Gravano of New York’s Gambino crime family. At a press conference outside Manhattan criminal court last night, he said Strauss-Kahn was “tired” and that the arraignment was postponed “because of the hour.”

Press and photographers had packed the arraignment part of the courthouse in lower Manhattan since morning, when news that the IMF chief may appear was first reported. Brafman and co- counsel William Taylor said their client agreed to the government request for a physical examination.

Popular Candidate

New York police said Strauss-Kahn doesn’t have diplomatic immunity. The French Foreign Ministry in Paris said the IMF will have to examine what immunity Strauss-Kahn may have. A French consul visited Strauss-Kahn in detention, ministry spokesman Bernard Valero said in a phone interview.

Strauss-Kahn, a former French finance minister and member of France’s opposition Socialist Party, has consistently been among the most popular possible candidates to contest France’s 2012 presidential election, according to opinion polls.

Manuel Valls, a Socialist Party executive, told RTL radio today that Strauss-Kahn told him two weeks ago, during a personal trip to Paris, that he was “getting ready” to run in the party primaries and potentially the presidential election. Valls said Strauss-Kahn’s decision to run was made, even though he hadn’t declared his intentions.

With his IMF term expiring next year, Strauss-Kahn has, in the past several months, declined to say whether he was planning to run for office. The vote will be held in April and May 2012.

President Nicolas Sarkozy would have trailed Strauss-Kahn by 5 percentage points in the first round of presidential voting if the election had been held at the end of last month, a CSA poll for 20 Minutes newspaper, BFM Television and RMC radio showed April 28.

‘A Tsunami’

Any prospect of getting elected has now vanished, said Laurent Dubois of the Paris Political Studies Institute.

“It’s a tsunami,” Dubois said in a phone interview. “There is no way he can recover from this and run.”

This is the second time since taking over the IMF that Strauss-Kahn has faced allegations of misconduct.

In 2008, he had a relationship with Piroska Nagy, a female economist at the IMF, who quit in August of that year. An investigation by the IMF board, released in October 2008, concluded that, while he had made a “serious error of judgment,” he shouldn’t be fired.

Strauss-Kahn apologized to his staff and family, which includes his third wife, French television journalist Anne Sinclair, and four children from his previous marriages.

‘Open, Transparent’

Sinclair yesterday said she doesn’t “for a second” believe the accusations against her husband, Agence France- Presse reported, citing a statement from her.

Last month, officials from the Group of 24, which includes Brazil, China and Mexico, repeated a call for “an open, transparent, merit-based process” for choosing the heads of the World Bank and IMF, “without regard to nationality.” The IMF job has traditionally been held by a European, while an American typically leads the World Bank.

Strauss-Kahn took the helm of the IMF in November 2007, following his loss in the primaries of the French Socialist Party ahead of the 2007 presidential elections.

Strauss-Kahn, who succeeded Spain’s Rodrigo Rato, has helped reshape the agency’s mission and restore its relevance. When he arrived, its emergency lending dropped to $58.7 billion in 2006 from $66.4 billion in 2002. Among his first moves there was to cut about 400 jobs.

The global financial panic triggered by the bankruptcy of Lehman Brothers Holdings Inc. (LEHMQ) in September 2008 restored the Washington-based IMF’s relevance as emergency loans soared to a record of $91.7 billion last year from $1.1 billion in 2007.

IMF Resources

Strauss-Kahn gained backing from the Group of 20 to triple the IMF’s resources, and the group has over the past two years given the agency a host of new missions to help avoid another crisis. The IMF is helping the G-20 single out countries whose policies threaten global growth, and has also submitted proposals to fortify the international monetary system.

More recently, Strauss-Kahn played a key role in efforts to stem the European debt crisis which started last year in Greece, with a pledge to contribute about a third of future bailouts in the region by the European Union. The IMF has co-funded aid packages to Greece and Ireland. He had been scheduled to meet with German Chancellor Angela Merkel yesterday.

Under Strauss-Kahn, the IMF also approved a plan that will make China the third-strongest voice in the 187-member organization, founded in 1945, while weakening Europe’s influence to make room for emerging countries.

1986

Strauss-Kahn has juggled careers as an economics professor, lawyer and Socialist politician. He holds a law degree and a doctorate in economics from the University of Paris.

In 1986, he was elected to France’s National Assembly and served as industry minister from 1991 to 1993. He returned to office as finance minister under Premier Lionel Jospin in 1997. He cut France’s budget deficit to less than 3 percent in 1999, the level required for euro membership.

In November 1999, he resigned as finance minister after magistrates began an investigation into financial irregularities at MNEF, a French student-insurance group. The probe covered an allegation that the company had paid him about $100,000 from 1994 to 1996 for legal work on a property deal which he never performed. Strauss-Kahn denied wrongdoing and was cleared by a Paris court in November 2001.

To contact the reporters on this story: Karen Freifeld in Manhattan Criminal Court at kfreifeld@bloomberg.net; Sandrine Rastello in Washington at srastello@bloomberg.net; David Glovin Manhattan Criminal Court at dglovin@bloomberg.net.

To contact the editors responsible for this story: Mike Hytha at mhytha@bloomberg.net and; Christopher Wellisz at cwellisz@bloomberg.net

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