IMF chief Dominique Strauss-Kahn denied bail in sex-assault case

Dominique Strauss-Kahn, the beleaguered head of the International Monetary Fund, on Monday was ordered held without bail on sexual-assault charges in New York.

As the financial world expressed its continuing confidence in the IMF, the international lender’s chief pleaded not guilty to charges that he sexually assaulted a maid in a hotel near Times Square.

Making his first court appearance since his arrest on Saturday, Strauss-Kahn was dressed in a black coat, his shirt collar rumpled. He looked grim as he stood silently next to his lawyer, Benjamin Brafman, as the not-guilty pleas on four felony counts and three misdemeanor counts were entered. The financier, a onetime leading potential candidate to be president of France, did not speak.

Strauss-Kahn faces up to 25 years in prison if convicted.

Strauss-Kahn’s family had wired $1 million to an account to be used for his bail, but the Manhattan district attorney’s office opposed any bond, arguing that he was a flight risk. The judge ordered him held pending his next court appearance, expected later this week.

“He is someone with access to substantial financial resources,” Assistant Dist. Atty. John A. McConnell told the court. “The charges are severe. He has a substantial incentive to flee.”

The prosecutor also argued that the maid provided “a very powerful and detailed account” that was corroborated by forensic evidence. The nature of the evidence was not specified, but Strauss-Kahn had medical tests while he was in custody.

The defendant’s lawyer rejected any possibility of Strauss-Kahn being a flight risk, even though he was arrested while on an airplane.

“He is the most easily identifiable individual in the world today,” Brafman argued. “This isn’t somebody who was on a plane who was trying to flee.” Brafman said the departure had been long scheduled. “There is no indication, nothing, nothing that he intends to flee.”

Outside the courtroom, Brafman said Strauss-Kahn should be presumed innocent. “We intend to review this decision to see if it should be appealed,” he said.

The arrest shocked France, where Strauss-Kahn was considered a strong potential presidential candidate, but the immediate effect was on the rest of Europe, where he was a key player in helping the continent work its way through the debt crisis involving the so-called peripheral countries, such as Greece, Portugal and Spain. As head of the IMF, Strauss-Kahn was scheduled to be in Brussels to attend a meeting of European finance ministers.

European stocks fell Monday amid debt worries.

The Obama administration said it expected the IMF would be able to deal with the debt issue despite the arrest.

“We note that the IMF has said that they have appointed an acting director, and the IMF remains fully functional,” White House Press Secretary Jay Carney told reporters on Air Force One, en route to Tennessee. “We remain confident in the institution of the IMF and its ability to execute its mission effectively.”

Carney said he would not comment directly on the arrest.

A member of France’s Socialist party, Strauss-Kahn was widely considered the strongest potential challenger next year to President Nicolas Sarkozy, whose political fortunes have ebbed.

French allies began on Monday to wage a strong defense.

Lawyers told RMC radio that Strauss-Kahn had left his hotel and was having lunch with his daughter, a student at Columbia University, at the time when authorities said the attack took place. After lunch, he went to the airport, realized that he had forgotten a cell phone and called the hotel to find the instrument. It was that call that allowed police to find him and arrest him at the airport.

Strauss-Kahn, 62, was taken from his first-class seat on an Air France flight to Paris that was about to depart from JFK International Airport.

According to authorities, Strauss-Kahn checked into the Sofitel hotel on Friday afternoon.

A maid, 32, said that when she entered his suite early 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, according to New York City police.

The maid was taken by police to a hospital and was treated for minor injuries.

In a prepared statement, Strauss-Kahn’s wife, Anne Sinclair, told the French news agency AFP: “I do not believe for one second the accusations brought against my husband,” said Sinclair, a New York-born journalist who sent the money to be used for the bail. “I have no doubt his innocence will be established.”

In 2008, Strauss-Kahn was investigated over whether he had had an improper relationship with an employee. The IMF board found his actions “reflected a serious error of judgment” yet decided the relationship was consensual.

Times staff writer Popper reported from New York, special correspondent Willsher from Paris and staff writer Muskal from Los Angeles.