International Monetary Fund

IMF chief cleared of abuse of power

Article published on the 2008-10-26 Latest update 2009-05-10 12:24 TU

Dominique Strauss-Kahn
( Photo: AFP )

An enquiry into International Monetary Fund chief Dominque Strauss-Kahn has cleared him of accusations of harassment, favouritism and abuse of power over an affair with a colleague. But the IMF's Executive Board has rapped him over the knuckles, saying that he committed "a serious error of judgement".

The IMF brought in Washington law firm Morgan, Lewis and Bockius to conduct an enquiry after staff expressed concern over Strauss-Kahn's extra-marital affair with Hungarian-born economist Piroska Nagy.

The enquiry found no evidence that Strauss-Kahn had offered or arranged for work-related benefits for Nagy or that he had threatened her.

It said that Nagy, who left the IMF in August to join the European Bank for Reconstruction and Development, says that she decided to leave on her own accord and it concluded that Strauss-Kahn had nothing to do with the remuneration package she received as part of a voluntary redundancy programme.

The Executive Board declared that "there was no harassment, favouritism, or any other abuse of authority by the managing director".

But it added, "Nevertheless, the executive board noted that the incident was regrettable and reflected a serious error of judgment."

Strauss-Kahn accepted the reproof.

"I agree with the statement made by the executive board today in concluding its inquiry," he said. "I very much regret the incident and I accept responsibility for it."

Before going to the IMF in September 2007, Strauss-Kahn was a leading member of France's Socialist Party, serving as Economy Minister from 1997 to 1999 but failing to win nomination as the party's candidate in the 2007 presidential election.