Sex charge probe fuels IMF crisis
The alleged sexual liasion of International Monetary Fund boss Dominique Strauss-Kahn with his subordinate staff has created a political storm in France. Allegation regarding Dominique Strauss-Kahn's relationship with a female employee threatens serious embarrassment for French President Nicolas Sarkozy, who campaigned vigorously last year to install his former political rival as the IMF’s chief executive.
Yet Paris insiders were warning that the charming and charismatic leftwinger — widely known by his initials, DSK — had a potentially perilous weakness for women. Strauss-Kahn had combined a glamorous Parisian lifestyle with a high-flying political career that was once expected to earn him the French presidency.
The International Monetary Fund (IMF) has been plunged into a leadership crisis at the height of world financial turmoil by allegations that its managing director had an affair with a married employee.
The IMF has begun an investigation into whether Dominique Strauss-Kahn, the former French Socialist finance minister, acted improperly by showing favouritism to Piroska Nagy, a Hungarian official in the fund’s Africa department.
Investigators are also examining a pay-off received by Nagy when she resigned in August before taking a job with the European Bank for Reconstruction and Development in London.Robert Litt, her lawyer, denied that she had received “special treatment”.
The affair is reported to have come to light when Nagy’s husband Mario Blejer, an Argentine-born economist who once worked at the Bank of England, discovered compromising emails.
Strauss-Kahn, 59, who is married to Anne Sinclair, one of France’s most popular television presenters, said in a statement on Saturday that he was “continuing to cooperate” with the investigation into what he described as an “incident which occurred in my private life”. He added: “At no time did I abuse my position as the fund’s managing director.”