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DOMINIQUE STRAUSS-KAHN

Decision delayed on DSK pimping charges

A French court has delayed a decision on whether to drop pimping charges against former IMF chief Dominique Strauss-Kahn until December 19th, prosecutors said on Wednesday.

Published: 28 November 2012 13:28 CET
Decision delayed on DSK pimping charges
Photo: Guillaume Paumier

The appeals court in the northern town of Douai had been expected on Wednesday to rule on a request from Strauss-Kahn's lawyers to stop a judicial inquiry into claims that he and associates arranged sex parties with prostitutes.

The case is the last in a series of sex-related probes that the former International Monetary Fund chief and one-time presidential front-runner has faced in France.

His lawyers have argued the charge of "aggravated pimping in an organized gang" has not been supported and that investigation procedures were not followed in the case, including with leaks to the press.

"Clearly the questions we have asked them are not so easy to dismiss," one of Strauss-Kahn's lawyers, Henri Leclerc, said after hearing the ruling had been delayed.

 The case, known in France as the "Carlton affair", centres around allegations that business leaders and police officials in Lille operated a
vice ring supplying girls for sex parties, some of which are said to have taken place at the Carlton Hotel in the northern city.

Among Strauss-Kahn's fellow accused is Jean-Christophe Lagarde, a police commissioner, and Rene Kojfer, the former public relations officer at the Carlton.

Lawyers for Lagarde and Kojfer have claimed their clients have effectively been caught up in a political witch-hunt against Strauss-Kahn, arguing that there would have been no probe but for his involvement.

Strauss-Kahn suffered a stunning fall from grace following his arrest at a New York hotel on sexual assault charges last year and a subsequent string of sex-related investigations in France.

Criminal charges against him were quickly dropped in the US because of doubts over the reliability of the alleged victim's testimony.

She is however pursuing a civil case against her alleged attacker while Strauss-Kahn, 63, has filed a counter suit against her for defamation and is pursuing a claim of malicious prosecution through the US courts.

French prosecutors last month dropped an investigation into Strauss-Kahn's alleged participation in a gang rape after the woman involved said she had consented and was not pressing charges.

After he resigned from the IMF and returned to France, Strauss-Kahn also faced an accusation from 32-year-old author Tristane Banon that he had tried to rape her in 2002.

French investigating magistrates questioned Strauss-Kahn and his accuser and concluded that while there was prima facie evidence of a sexual assault, the alleged attack had occurred too long ago to be prosecuted.

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ECONOMY

World unprepared for next financial crisis: ex-IMF chief Strauss-Kahn

The world is less well equipped to manage a major financial crisis today than it was a decade ago, according to Dominique Strauss-Kahn, a former chief of the International Monetary Fund (IMF).

Published: 9 September 2018 14:08 CEST
World unprepared for next financial crisis: ex-IMF chief Strauss-Kahn
Former French Economy Minister and former managing director of the International Monetary Fund (IMF) Dominique Strauss-Kahn , poses during a photo session in Paris on Thursday. Photo: JOEL SAGET / AFP
In an interview with AFP, the now-disgraced Strauss-Kahn — who ran the fund at the height of the 2008 financial meltdown — also said rising populism across the world is a direct result of the crisis. 
 
Strauss-Kahn resigned as head of the IMF in 2011 after being accused of attempted rape in New York, although the charges were later dropped. He settled a subsequent civil suit, reportedly with more than $1.5 million.
 
Q: When did you become aware that a big crisis was brewing?
 
A: When I joined the IMF on Nov 1, 2007, it became clear quite quickly that things were not going well. That is why in January 2008, in Davos, I made a statement that made a bit of noise, asking for a global stimulus package worth two percent of each country's GDP. In April 2008, during the IMF's spring meetings, we released the figure of $1,000 billion that banks needed for their recapitalisation.
 
Q: Did the Bush administration grasp the danger of Lehman Brothers going bankrupt?
 
A: No, and that is why Treasury Secretary Henry Paulson decided not to save Lehman, because he wanted to make an example of it in the name of moral hazard. Like everybody else, he considerably underestimated the consequences. Allowing Lehman to go under was a serious mistake. Especially because only a week later they were forced to save the insurer AIG, which was much bigger.
 
Q: Ten years on, are we better equipped to deal with a crisis of such a magnitude?
 
A: No. We have made some progress, particularly in the area of banks' capital adequacy ratios. But that is not nearly enough. Imagine Deutsche Bank suddenly finding itself in difficulty. The eight percent of capital it has at its disposal are not going to be enough to solve the problem. The truth is that we are less well prepared now. Regulations are insufficient.
 
Q: How so?
 
A: After 2012-2013 we stopped talking about the need to regulate the economy, for example concerning the size of banks, or concerning rating agencies. We backtracked, which is why I am pessimistic about our preparedness. We have a non-thinking attitude towards globalisation and that does not yield positive results.
 
Q: Do we still have international coordination?
 
A: Coordination is mostly gone. Nobody plays that role anymore. Not the IMF and not the EU, and the United States president's policies are not helping. As a result, the mechanism that was created at the G20, which was very helpful because it involved emerging countries, has fallen apart. Ten years ago, governments accepted leaving that role to the IMF. I'm not sure it is able to play it today, but the future will tell.
 
Q: Do you believe that Donald Trump's election is a consequence of the crisis?
 
A: I believe so. I'm not saying that there was a single reason for Trump's election, but today's political situation is not unconnected to the crisis we lived through, both in the US with Trump and in Europe.
 
Q: Connected how?
 
A: One of the consequences of the crisis has been completely underestimated, in my opinion: the populism that is appearing everywhere is the direct outcome of the crisis and of the way that it was handled after 2011/2012, by favouring solutions that were going to increase inequalities.
 
Quantitative easing (by which central banks inject liquidity into the banking system) was useful and welcome. But it is a policy that is basically designed to bail out the financial system, and therefore serves the richest people on the planet.
 
When there's a fire, firemen intervene and there is water everywhere. But then you need to mop up, which we didn't do. And because this water flowed into the pockets of some, and not of everyone, there was a surge in inequality.
 
By AFP's Antonio Rodriguez