Ex-IMF boss gets bail in sex case

Former IMF chief Dominique Strauss-Kahn has been granted $1-million bail and will face home detention, a New York judge has decided.
Former International Monetary Fund leader Dominique Strauss-Kahn leaves court to return to jail after being granted bail in New York Thursday. He is expected to be released Friday and will remain under house arrest. (Richard Drew/Pool/Getty Images)

A judge has agreed to free former International Monetary Fund leader Dominique Strauss-Kahn from a New York City jail on the condition that he remain under house arrest.

The judge set bail at $1 million US, and approved an elaborate arrangement under which the 62-year-old banker would be confined to a private apartment in Manhattan and monitored by armed guards, an expense he will have to pay for.

Strauss-Kahn will also have to take out a $5-million insurance bond.

He looked relieved after Supreme Court Justice Michael J. Obus announced his decision in a packed Manhattan courtroom. Later, he blew a kiss toward his wife.

Manhattan District Attoreny Cyrus Vance speaks to the media about the indictment of former International Monetary Fund leader Dominique Strauss-Kahn outside criminal court in New York, Thursday. (Seth Wenig/Associated Press)
His political career in shambles and his leadership of the IMF a memory, Strauss-Kahn was formally indicted Thursday on charges that he sexually abused a hotel maid. An arraignment hearing has been set for June 16. Strauss-Kahn has not entered a plea in the case, but his lawyers have indicated he will plead not guilty.

The former head of the International Monetary Fund arrived in a Manhattan courtroom Thursday afternoon wearing a gray suit and an open blue shirt. He turned to give a quick smile to supporters in the gallery that included daughter Camille Strauss-Kahn and his wife, the television journalist Anne Sinclair.

Strauss-Kahn is expected to spend one more night behind bars at New York's bleak Rikers Island jail complex pending his release on bail Friday.

"He's going back to Rikers tonight and we expect him to be released tomorrow," said William Taylor, one of his attorneys.

In France, a Socialist lawmaker and longtime ally, Francois Pupponi, expressed relief at the decision to allow Strauss-Kahn to leave jail.

"There's finally a bit of good news in a terrible week," he said on BFM-TV. "We were no longer expecting good news."

A prosecutor began Thursday's hearing by announcing that a grand jury had found enough evidence for an indictment, a procedural step that elevates the seriousness of the charge.

"The proof against him is substantial. It is continuing to grow every day as the investigation continues," said Assistant District Attorney John (Artie) McConnell.

An attorney for Strauss-Kahn, William Taylor, told court that Sinclair had rented an apartment in the city where her husband could be confined and watched by an armed monitor, although he suggested few precautions were necessary.


Mark Carney for IMF chief?

Bank of Canada governor Mark Carney, who has been named by Time magazine as one of the world's most influential men, is being taken seriously in international circles as a possible replacement for disgraced International Monetary Fund head Dominique Strauss-Kahn.

London bookmaker William Hill has placed Carney as a 10:1 pick for the prestigious international job. 

Those are still long odds — the favourite is Turkish politician and economist Kemal Dervis at 5:2 — but it places the Canadian banker, who made his name at Goldman Sachs, in elite company.

According to the odds, Carney is tied for sixth place with John Lipsky, now the IMF's acting head, and just behind former British prime minister Gordon Brown.

When reporters asked Carney if he wanted the job, he did not completely rule out a candidacy but noted he still has four years remaining in his seven-year mandate at the Bank of Canada.

Carney said he believes the next IMF head should be decided strictly on "merit" and not on  geographical considerations. All past heads of the IMF have come from Europe, but leaders at the G20 summit in London said the practice should be changed.

Canadian Press

"In our view, no bail is required to confirm Mr. Strauss-Kahn's appearance. He is an honorable man ... and he has only one interest at this time, and that is to clear his name," Taylor said.

Strauss-Kahn resigned as managing director of the International Monetary Fund late Wednesday, saying he needed to focus on clearing his name.

His lawyers have promised that, if released, he won't flee to France. They asked that Strauss-Kahn be placed under house arrest in New York, and wear an electronic device to monitor his movements.

The defence team made a similar request Monday that was denied, but was making additional arguments before a new judge, Obus, who oversees all criminal courts in Manhattan.

The judge called a brief recess during the hearing to ponder written materials.

Scores of reporters lined up outside the courtroom door before the hearing, with still more journalists and cameras poised outside the building. State court system spokesman David Bookstaver said the media throng was one of the biggest at the courthouse since Mark David Chapman was arrested in the 1980 killing of John Lennon.

Prosecutors opposed Strauss-Kahn's release, saying his wealth and international connections would make it easy for him to flee.

Strauss-Kahn is charged with attacking a housecleaner Saturday afternoon at his Manhattan hotel suite. The 32-year-old West African immigrant told police that he chased her down a hallway, forced her to perform oral sex and tried to remove her stockings.

In his resignation letter, released by the IMF executive board, Strauss-Kahn denied the allegations against him, but said he would quit to protect the institution.

The political wrangling over who will succeed Strauss-Kahn at the IMF already has begun. European officials, including Germany's chancellor, the European Commission and France's finance minister, have been arguing that his replacement should be European.

Some authorities from China and Brazil have said it is time to break Europe's traditional dominance over the position and appoint someone from a developing nation. U.S. Treasury Secretary Timothy Geithner has asked for an "open process," without mentioning any specific candidates.