http://www.washingtonpost.com/business/economy/imf-head-taken-into-custody-in-new-york-questioned-over-sex-assault/2011/05/14/AF8Tfj3G_story.html?nl_headlines

IMF chief arrested in alleged sex assault, police tell AP

View Photo Gallery - ?IMF chief Dominique Strauss-Kahn was removed from a 
Paris-bound flight in New York Saturday and arrested in connection with an 
alleged sexual assault of a hotel housekeeper, police told the Associated Press.

By Zachary A. Goldfarb, Updated: Sunday, May 15, 9:18 AM 
NEW YORK - The head of the International Monetary Fund was removed from a 
Paris-bound flight in New York minutes before takeoff Saturday afternoon and 
was arrested in connection with a sexual assault on a housekeeper at a 
Manhattan hotel earlier that day, police told the Associated Press.

The AP reported that Dominique Strauss-Kahn, 62, was questioned by the New York 
Police Department's special victims office, according to Paul J. Browne, police 
spokesman. The IMF chief was arrested at 2:15 a.m. Sunday on charges of 
criminal sex act, attempted rape and unlawful imprisonment, police said. 

Strauss-Kahn had retained an attorney and was not making statements to police, 
Browne said.

According to the AP report, Browne said the housekeeper told authorities she 
entered Strauss-Kahn's suite at the luxury Sofitel hotel not far from 
Manhattan's Times Square at about 1 p.m., and that he attacked her. She said 
she had been told to clean the spacious $3,000-a-night suite, which she had 
been told was empty, Browne said.

The wire service said the woman gave this account to police: Strauss-Kahn 
emerged from the bathroom naked, chased her down a hallway and pulled her into 
a bedroom, where he began to sexually assault her. She said she fought him off, 
but then he dragged her into the bathroom. The woman was able to break free 
again, escaped the room and told hotel staff what had happened, and they called 
police, authorities said..

He previously served as France's finance minister and is the subject of intense 
speculation in France that he will declare his candidacy for president as a 
member of the Socialist Party. He unsuccessfully ran for his party's nomination 
in the last election.

At the IMF, Strauss-Kahn has overseen a number of crucial emergency loan 
packages for troubled economies, most recently for Greece and Pakistan.

The organization is also being eyed to help orchestrate potential bailouts for 
Portugal and Ireland as Europe suffers a painful debt crisis. And it is working 
to help Egypt as that country tries to stabilize its economy in the 
post-Mubarak era.

"This sordid episode - no matter how it ultimately plays out - will spell the 
end of Strauss-Kahn as an effective leader of the IMF even if he retains his 
position, which is highly unlikely," said Eswar Shanker Prasad, an 
international economics professor at Cornell University. "With Strauss-Kahn's 
departure, the IMF can no longer be counted on to watch Europe's back as it 
becomes increasingly clear that the EU-IMF program in Greece is not working." 

Prasad added, "Additional uncertainty is the last thing that Europe needs right 
now, but that will be the reality as the IMF absorbs this body blow and 
reorients itself to a post-Strauss-Kahn era."

In 2008, Strauss-Kahn was investigated on suspicion that he might have abused 
his authority in an extramarital affair with an economist who had left the IMF 
with financial compensation. He kept his position but acknowledged that he had 
made a "serious error of judgment." 

As a member of the Socialist Party, Strauss-Kahn has been criticized in France 
for enjoying a lavish lifestyle of expensive cars and clothing, which he has 
denied.

At the IMF, Strauss-Kahn has been helping to transform the organization after 
the financial crisis. He wants to be able to probe financial firms around the 
world and demand more data. And he wants the IMF to develop better indicators 
for when a country might be going off track economically.

The United States is the biggest shareholder in the IMF and makes its largest 
financial contribution each year.

Treasury Secretary Timothy F. Geithner, who represents the United States at the 
IMF, has been pushing the organization to use its power to pressure China to 
allow its currency to increase in value, which the country has resisted. 
Allowing the renminbi to appreciate would make it easier for American companies 
to sell into China.

Under Strauss-Kahn, the IMF has exerted only modest pressure, aware that China 
is an important emerging power. The IMF, which once had as many as 3,000 
employees, is based near Foggy Bottom. Strauss-Kahn's deputy, John Lipsky, has 
already announced his plans to depart later this summer.


Browne said that when police detectives arrived moments later, Strauss-Kahn had 
already left the hotel, leaving behind his cellphone, the AP reported. "It 
looked like he got out of there in a hurry," Browne said.

Police discovered that he was at the airport, and they contacted Port Authority 
officials, who removed Kahn from first class on the Air France flight that was 
scheduled to depart at 4:40 p.m. and was just about to leave the gate.

The allegations create immediate uncertainty for the Washington-based IMF, 
which has been playing an important role in stabilizing the global economy amid 
the financial crisis.

It also promises to stir up politics in France, where Strauss-Kahn is widely 
thought to be considering challenging French President Nicolas Sarkozy in next 
year's election. Polls have indicated that he has a good chance of defeating 
Sarkozy.

An IMF spokesman had no immediate comment.

About 10 minutes before Air France Flight 23 was to take off Saturday, officers 
with the Port Authority of New York and New Jersey boarded the plane and 
removed Strauss-Kahn, authorities said. They did not handcuff him.

The officers were acting at the behest of the NYPD and turned over the 
Frenchman to police shortly thereafter. The Associated Press reported that a 
top police spokesman said that Strauss-Kahn had been staying at the Sofitel 
near Times Square.

An economist and lawyer who has gained prominence while leading the IMF through 
one of the world's worst financial crises, Strauss-Kahn joined the organization 
in 2007 with the support of the United States and many European nations.

More on this Story

  a.. IMF chief arrested in alleged sexual assault
  b.. Arrest likely to upset French political landscape
  c.. Photos: Dominique Strauss-Kahn arrested


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