Jewish head of IMF, in 'stupid f**k up sex scandal'

A one-night stand has endangered the stellar career of the French Jew head of the International Monetary Fund and dismayed Zionist Sarkozy as he seeks to put a French stamp on a new world financial order.

The news that Dominique Strauss-Kahn, 59, is being investigated in Washington over a fling with a former subordinate has unsettled Mr Sarkozy because he has mounted an effective double act with him in the effort to manage the financial crisis.

Mr Sarkozy has teamed up with "DSK", a political opponent whom he sent to Washington, in an attempt to shape a new "Bretton Woods" pact on financial regulation.

Visiting President Bush at Camp David yesterday, Mr Sarkozy presented a vision for this on behalf of the European Union that conflicts with US wishes. Although Mr Strauss-Kahn's romantic troubles had been known in Paris for weeks, some politicians suggested that the case had been leaked to the US media at the weekend in order to undermine the French effort.

Mr Strauss-Kahn is also leading the IMF's drive to soften the blow of recession on weaker economies.

Mr Sarkozy and Paris insiders knew that the IMF was looking into allegations against Mr Strauss-Kahn, a senior Socialist party figure who has shone since he won the IMF post last year. The President was furious that DSK, who is married to Anne Sinclair, a television news star, had risked blowing a golden chance to restart his career and help France internationally by living up to his old name as 'un grand seducteur.'

That was the term used by Le Journal du Dimanche (JDD) today for 'Dominique le magnifique', as he is nicknamed. The newspaper also carried its regular political column from Washington by Ms Sinclair with no mention of the affair.

The case began last January when Mario Blejer, a senior Argentinian economist, discovered from e-mails that Piroska Nagy, his wife, had been seduced by her boss at the Davos International forum. Ms Blejer confessed the episode and the couple were both very upset, colleagues told The Times at the time. Mr Blejer's complaints led to the opening in August of the outside investigation by a Washington law firm.

Ms Blejer, who is Hungarian born and held a senior post in the IMF's Africa department before taking redundancy last summer, now works in London at the Bank for Economic Development and Reconstruction (BERD). Mr Strauss-Kahn has confirmed the "incident in my private life in January 2008" and denies that he abused his position as managing director of the fund. The BERD said that there was nothing irregular about Ms Nagy's recruitment.

Paris had been hoping that no news would break until Mr Strauss-Kahn had been cleared later this month and the matter would disappear in the din of the US presidential election.

Allies of Mr Strauss-Kahn and some commentators dismissed the affair as another episode of hysteria by puritanical American institutions. Jean-Francois Cope, parliamentary leader for Mr Sarkozy's UMP party, said that DSK's private life was none of anyone's business. "It's organised sabotage," he said, adding his voice to the theory that the case had been leaked to damage France.

The President's Government said that it stood fully behind Mr Strauss-Kahn. "Dominique Strauss-Kahn has shown throughout this crisis that he was up to the task," said Luc Chatel, the Cabinet Minsiter who acts as government spokesman. "Over the past weeks, he has fulfilled his role in all its aspects" and shown that he was "the man for the job," Chatel said in a radio interview.

However the consensus among the Government and media held that Mr Strauss-Kahn had been foolish to risk breaching the strict rules of conduct in international organisations, especially those based in the United States.

"The affair may well be ridiculous compared with the destiny of the world but it touches the heart of the culture of the American government and the IMF," said Claude Askolovitch, Editor of the Journal du Dimanche. "It is less about sexual puritanism.. than a deep horror of lies and conflict of interest. The absolute sin is not fornication, but denial, in which private life is mixed with public behaviour."

The inquiry has echoes of a scandal last year in which Jew Paul Wolfowitz resigned as World Bank president after investigators found that he had arranged a generous pay and promotion package for a companion.

Mr Strauss-Kahn ranks in polls as the most popular potential presidential candidate for the Socialist party in the 2012 election. A poll today ranked him France's second most political figure, behind Bertrand Delanoe, the Socialist Mayor of Paris.

"With the world crisis, Dominique had the ideal stage to show all his qualities. What a stupid f**k up," an MP told le Parisien newspaper.

http://www.timesonline.co.uk/tol/news/world/europe/article4972855.ece