IMF chief’s sexual assault inquiry shakes Europe

Accusations that the powerful French politician who heads the International Monetary Fund sexually assaulted a Manhattan hotel maid unleashed a crisis in his homeland, where he had been considered a leading candidate for president, and added to the jitters of European economies in need of financial support.

New York tabloid reporters, tourists and more than a dozen well-dressed French journalists waited for hours Sunday for the arraignment of Dominique Strauss-Kahn as a court conducted business as usual on a chaotic weekend: Three judges processed nearly 200 suspects accused of crimes including scrawling graffiti, refusing to pay a taxi fare, public drunkenness and domestic assaults. But Strauss-Kahn was not among them.

His lawyers told reporters late Sunday that he would undergo a forensic test, and that his court appearance had been postponed until Monday. “He intends to vigorously defend these charges and he denies any wrongdoing,” said Benjamin Brafman, a high-profile New York defense attorney.

Still, the accusations that the 62-year-old IMF managing director had assaulted a maid in a Times Square-area hotel the previous day reverberated throughout France and across Europe.

A poll published in France’s Le Parisien newspaper on Sunday as the scandal was breaking across the Atlantic had suggested that Strauss-Kahn was likely to win the Socialist Party nomination for president later this year. Several other polls gave him a good shot at unseating unpopular incumbent Nicolas Sarkozy next spring.

Hearing the news, one French lawmaker said that Strauss-Kahn’s dreams of power had been “terminated.”

Jean Viard, director of research at the elite Paris Institute of Political Studies, said if the charges were found to be true, it would “completely shake up the political landscape” in France, improve Sarkozy’s chances of reelection and also serve as a boost to the far-right National Front.

Strauss-Kahn has served for the last 3 1/2 years as managing director of the IMF, a financial institution with 186 member countries that provides loans and supports development.

IMF spokesman William Murray said in a statement that in line with agency procedures, the institution’s No. 2 official, American John Lipsky, would assume the role of acting managing director.

With his political connections and past experience as French finance minister, Strauss-Kahn also has played an important role in plans by the IMF and European Union to rescue the Greek, Irish and Portuguese economies.

Before his removal from an Air France flight in New York on Saturday, he had been on his way to meet with Chancellor Angela Merkel of EU stalwart Germany, and then with finance officials in Brussels, about the continent’s lingering economic woes.

“There is huge concern in Europe that this event will heighten pressure on Greece and the other periphery economies in Europe over the next few days,” said Eswar S. Prasad, a Cornell University professor and former head of the IMF’s China division.

Strauss-Kahn was widely expected to leave the IMF this summer, before the end of his five-year term, to pursue the French presidency. But analysts said an abrupt exit could diminish Europe’s influence and increase pressure for the IMF to install a managing director from Asia or Latin America.

About 1 p.m. Saturday, a maid at the Sofitel hotel entered Strauss-Kahn’s room to clean it, said Paul J. Browne, deputy New York City police commissioner, adding that the French official came out of the bathroom naked, pushed her onto the bed and assaulted her.

A police source said Sunday that the alleged victim had picked him out of a lineup, adding that the forensic testing was intended to get any possible DNA samples from the victim off Strauss-Kahn’s body.

Strauss-Kahn was taken initially to the Manhattan Special Victims Unit in Harlem, which investigates rape and other sex crimes. Police charged him with committing a criminal sexual act, attempted rape and unlawful imprisonment, Browne said. The Manhattan district attorney will determine the final charges.

Ira Judelson, the bail bondsman in the case, said bail could range from $250,000 up to $5 million. He said Strauss-Kahn’s passport had been confiscated.

Strauss-Kahn is married to Anne Sinclair, his third wife, who is a leading broadcast journalist. In a statement Sunday, she said she “did not believe for a single second” the accusations against her husband.

Strauss-Kahn is widely recognized in France as a brilliant economist, a charismatic Socialist, former professor and graduate of the country’s most prestigious universities. But he also has gained a reputation over the years as a free-spending lover of luxury who gained the nickname “the Great Seducer.”

Early in his IMF tenure, he was forced to apologize for “an error in judgment” after an affair with a junior colleague, but he was cleared of abusing his position.

geraldine.baum@latimes.com

Staff writer Baum reported from New York and special correspondent Willsher from Paris. Times staff writer Don Lee in Washington and special correspondent Devorah Lauter in Paris contributed to this report.