Strauss-Kahn’s weekend arrest rocked the financial world as the IMF grapples with the European debt crisis, and upended French presidential politics.

Dominique Strauss-Kahn (62), Managing Director of the International Monetary Fund, was remanded to the infamous Rikers Island prison in New York City following the denial of bail over charges that he attempted to sexually assault a hotel maid on Saturday.

Mr. Strauss-Kahn, who appeared “haggard and unshaven” before a New York City district judge following a weekend in prison, was refused bail after state prosecutors argued that he would likely flee to France. "He would be living openly and notoriously in France, just like Roman Polanski," Chief Assistant District Attorney Daniel Alonso said to media.

The top economist and potential presidential contender in French politics, who was said to have subjected a maid in his $3,000-a-night suite to a prolonged sexual attack, will wake up on Thursday in an eleven-by-fourteen-foot jail cell in the same jail compound that housed Mark Chapman, musician John Lennon’s killer.

Given the high-profile nature of his case, however, Mr. Strauss-Kahn will be held in protective custody in Rikers’ West Facility, one of ten prisons within the complex. Although it is the smallest facility, the West Facility was said to be "typically used to house prisoners with contagious diseases", and was thought to be appropriate for Mr. Strauss-Kahn as he will not be permitted any contact with other prisoners "in case he is attacked by other inmates", reports said.

While Mr. Strauss-Kahn’s arrest has raised questions about whether the IMF’s role in managing the ongoing debt crisis in Europe would continue unimpeded, the Fund only issued a muted statement confirming Mr. Strauss-Kahn’s arrest. Noting that all inquiries would be referred to his personal lawyer and to the local authorities, a press officer said, "The IMF remains fully functioning and operational."

In the bail hearing earlier on Monday, Mr. Strauss-Kahn’s defence attorney, Ben Brafman, argued that the "battle has just begun", and it was "quite likely he will be exonerated". His defence team also confirmed that Mr. Strauss-Kahn had agreed to subject himself to forensic testing.

Following his arrest, authorities charged Mr. Strauss-Kahn with attempted rape, forcible touching, sex abuse, unlawful imprisonment and a criminal sex act. For the most serious charge, Mr. Strauss-Kahn could face anywhere between five to 25 years in prison, legal experts said.

After Mr. Strauss-Kahn was arrested on Sunday as he attempted to board a flight to Paris from New York’s John F Kennedy airport, Judge Melissa Jackson had rejected his offer of $1 million as bail, along with his offer to wear an electronic tag. Mr. Brafman however suggested that his client might appeal the bail denial.

AP adds:

In France, a lawyer for a novelist said the writer is likely to file a criminal complaint accusing Mr. Strauss-Kahn of sexually assaulting her nine years ago. A French lawmaker accused him of attacking other maids in previous stays at the same luxury hotel. And in New York, prosecutors said they are working to verify reports of at least one other case, which they suggested was overseas.

Strauss-Kahn’s weekend arrest rocked the financial world as the IMF grapples with the European debt crisis, and upended French presidential politics. Strauss-Kahn, a member of France’s Socialist party, was widely considered the strongest potential challenger next year to President Nicolas Sarkozy.

Strauss-Kahn, who has headed the international lending agency since 2007, was in New York on personal business and was paying his own way, so he cannot claim diplomatic immunity, the IMF said. He could seek that protection only if he were conducting official business, spokesman William Murray said. The agency’s executive board met informally Monday for a report on the charges against Strauss-Kahn, its managing director.

The French newspaper Le Monde, citing people close to Strauss-Kahn, said he had reserved the $3,000-a-night suite at the Sofitel hotel for one night for a quick trip to have lunch with his daughter, who is studying in New York.

The 32-year-old maid told authorities that she thought the suite was empty but that Strauss-Kahn emerged from the bathroom naked, chased her down a hallway, pulled her into a bedroom and dragged her into a bathroom, police said. She ultimately broke free, escaped the room and told hotel staffers what had happened, authorities said. She was treated at a hospital for minor injuries.

“The victim provided a very powerful and detailed account of the violent sexual assault,” Assistant District Attorney John “Ardie” McConnell said. He added that forensic evidence may support her account. Strauss-Kahn voluntarily submitted to a forensic examination Sunday night.

Mr. Brafman said defence lawyers believe the forensic evidence “will not be consistent with a forcible encounter.” Defence lawyers wouldn’t elaborate, but Mr. Brafman said “there are significant issues that were already found” that make it “quite likely that he will be ultimately be exonerated.”

Prosecutors asked the judge to hold Strauss-Kahn without bail, noting that he lives in France, is wealthy, has an international job and was arrested on a Paris-bound plane at Kennedy Airport. He had left the Sofitel hotel before police arrived, leaving his cell phone behind, and appeared hurried on surveillance recordings, authorities said.

At one point, Strauss-Kahn called the hotel “in a panic” about the phone, a law enforcement official said Monday.

Hotel security officers hadn’t found a phone, but they were instructed by NYPD investigators to set a trap by informing him they had it and asking where they could get it to him, said the official, who spoke on condition of anonymity because the investigation had not been completed.

Strauss-Kahn told them he was about to board a flight - unknowingly tipping off authorities to his whereabouts, the official said.

Prosecutors said they couldn’t force Strauss-Kahn’s return from France if he went there.

“He would be living openly and notoriously in France, just like Roman Polanski,” said Chief Assistant District Attorney Daniel Alonso, referring to the film director long sought by California authorities for sentencing in a 1977 child sex case. Swiss police arrested him in 2009, but he was freed last year when Switzerland declined to extradite him to the United States.

Defence lawyers suggested bail be set at $1 million and promised that the IMF managing director would remain in New York City. His lawyers said Strauss-Kahn wasn’t trying to elude police Saturday - The IMF head rushed out of the hotel at about 12-30 p.m. to get to a lunch date with a family member, then caught a flight for which he had long had a ticket, according to Mr. Brafman and fellow defence lawyer William W. Taylor.

“This is not a case of someone who commits a crime, runs to the airport and jumps on the first available plane,” Mr. Brafman said.

Still, Criminal Court Judge Melissa C. Jackson said the fact that Strauss-Kahn was on a plane when arrested “raises some concerns.” She ordered him jailed at least until a court proceeding on Friday.

Strauss-Kahn makes an annual tax-free salary as head of the IMF of $420,930, plus an annual “scale of living” allowance of $75,350, according to a 2007 IMF news release.

Strauss-Kahn will be held in protective custody in the city’s Rikers Island jail because of his high profile, said city Correction Department spokesman Stephen Morello. Unlike some inmates, who share 50-bed barracks, Strauss-Kahn will have a single-bed cell and eat all his meals alone there. Also, when he is outside his cell, he will have a prison-guard escort.

Meanwhile, a lawyer for 31-year-old French novelist Tristane Banon said she will probably file a complaint alleging Strauss-Kahn sexually attacked her in 2002. Lawyer David Koubbi told French radio RTL that Ms. Banon hadn’t pressed her claim earlier because of “pressures” but would do so now because “she knows she’ll be taken seriously.”

The Associated Press is identifying Ms. Banon as an alleged victim of sexual assault because she has gone public with her account.

Ms. Banon’s mother, Anne Mansouret, a regional Socialist official in Normandy, said she had advised her daughter at the time against pursuing her claim.

A French lawmaker from a rival political party also alleged, without offering evidence, that Strauss-Kahn had victimized several maids during past stays at the Sofitel near Times Square.

The hotel issued a statement calling conservative lawmaker Michel Debre’s claims “baseless and defamatory.” Sofitel management “has had no knowledge of any previous attempted aggressions,” the hotel said, adding that it had set up a hotline for workers to report incidents more than a year ago.

McConnell, the assistant district attorney, said in court Monday that New York authorities are working to verify at least one other case of “conduct similar to the conduct alleged.” When the judge asked whether the potential other incident occurred in the United States, Mr. McConnell said he “believed that was abroad.”

Strauss-Kahn’s lawyers said they had no immediate response to the allegations emerging from overseas.

In France, defenders of Strauss-Kahn, a former finance minister who had topped the polls as a possible candidate in presidential elections next year, said they suspected he was the victim of a smear campaign.

The 187-nation IMF provides emergency loans to countries in severe distress and tries to maintain global financial stability.

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