Arrest of IMF leader jolts France, raises questions on bailouts in Europe

NEW YORK — Charges that International Monetary Fund leader Dominique Strauss-Kahn sexually assaulted a maid in his hotel room in New York generated shock and revulsion on Sunday in his home country of France and raised questions on efforts to fix Europe's debt crisis.

The longtime Socialist Party figure and former French finance minister has been cited in opinion polls as the strongest potential challenger to President Nicolas Sarkozy in presidential elections scheduled a year from now. But that equation was disrupted, commentators said.

At the same time, the IMF, which plays a key role in efforts to control the European debt crisis, named an acting leader, first deputy managing director John Lipsky, and said it remains "fully functioning and operational" despite Saturday's arrest of its managing director.

But Strauss-Kahn has been a muscular advocate for aiding Greece, Ireland and Portugal as they have fought to avoid insolvency. A default by a developed European economy would shock the global financial markets and endanger the nascent economic recovery in the United States.

He had been due in Germany on Sunday to meet with Chancellor Angela Merkel about increasing aid to Greece, and then was to join European Union finance ministers in Brussels today and Tuesday. The IMF, which is based in Washington, is responsible for one-third of Greece's loans.

Strauss-Kahn, 62, was arrested less than four hours after the alleged assault, plucked from a Paris-bound Air France flight that was about to leave John F. Kennedy International Airport.

The well-dressed, thrice-married father of four was alone when he checked into the luxury Sofitel hotel, not far from Manhattan's Times Square, on Friday afternoon, police said. It wasn't clear why he was in New York.

The maid, 32, told authorities that when she entered his suite Saturday afternoon, she thought it was unoccupied. Instead, Strauss-Kahn emerged from the bathroom naked, chased her down a hallway and pulled her into a bedroom, where he sexually assaulted her, New York police said.

The woman told police she fought him off, but then he dragged her into the bathroom, where he forced her to perform oral sex on him and tried to remove her underwear. The woman broke free again, escaped the room and told hotel staff what had happened, authorities said.

The maid was taken by police to a hospital and was treated for minor injuries. Stacy Royal, a spokeswoman for Sofitel, said that the hotel's staff was cooperating in the investigation and that the maid "has been a satisfactory employee of the hotel for the past three years."

Strauss-Kahn was arrested on charges of a criminal sex act, attempted rape and unlawful imprisonment.

His wife, Anne Sinclair, defended him, saying she did not believe the accusations. His New York lawyer, Benjamin Brafman, said he will plead not guilty.

In France, the Socialist Party leader, Martine Aubry, said news of the arrest had arrived in Paris "like a thunderbolt" during the night, throwing the party into disarray. But she urged the country to withhold judgment.

Jacques Attali, a fellow Socialist leader, told French reporters, "The most likely outcome is that the case will stick … he won't be able to be a candidate for the Socialist Party presidential primary. And he won't be able to stay on at the International Monetary Fund."

Bernard Debre, a member of Parliament from Sarkozy's conservative coalition, was more personal and more damning. In a conversation with Europe 1 radio, he called the arrest "very humiliating for our country."

Strauss-Kahn, who took over the IMF in 2007 after being nominated by Sarkozy, was involved the following year in a scandal involving an extramarital affair with a woman who headed the fund's Africa department and who left the IMF under a voluntary retirement plan. The bank's board reprimanded him.

Information from the Associated Press and Washington Post was used in this report.

.biography

Dominique Strauss-Kahn

Age: 62. Born in Neuilly-sur-Seine, France

Education: Degrees in law, business administration, political studies and statistics. Ph.D in economics from the University of Paris.

Family: Wife, Anne Sinclair, and four children by a previous marriage.

Career: Managing director of the International Monetary Fund since 2007, where he won praise for his handling of the global financial crisis. He was an economics professor, corporate lawyer and legislator in France's National Assembly. He served as finance minister from 1997 to 1999.

Arrest of IMF leader jolts France, raises questions on bailouts in Europe 05/15/11 [Last modified: Sunday, May 15, 2011 11:41pm]

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