MercoPress. South Atlantic News Agency

Former IMF chief case rapidly becoming a Mexican soap opera

French Socialists again hopeful Strauss-Khan could lead them in next year’s presidential election

Former IMF chief Dominique Strauss-Kahn was freed on Friday from house arrest after prosecutors raised serious doubts about his accuser's credibility, including that she lied to the grand jury.

The sensational twist raised French Opposition hopes that the sexual assault case will collapse and the Socialist heavyweight could return to politics, possibly even as a candidate to fight Nicolas Sarkozy for the presidency in 2012.

Mr Strauss-Kahn looked relaxed and cheerful as he left court, smiling his arm on the shoulder of wife Anne Sinclair. But prosecutors stressed that the charges stood and Judge Michael Obus told the courtroom: “The case is not over.”

The credibility of the Guinean hotel maid at the centre of the sexual assault and attempted rape allegations was shattered by the revelation that she lied to the grand jury.

According to the alleged victim's initial story, she immediately fled Mr Strauss-Kahn's luxury Manhattan hotel suite after the attack and waited in the hallway before informing a supervisor.

“The complainant has since admitted that this account was false and that after the incident in Suite 2806, she proceeded to clean a nearby room and then returned to Suite 2806 and began to clean that suite before she reported the incident to her supervisor,” prosecutors said in court filings.

The alleged victim's lawyer admitted his client had made “some mistakes”, but insisted substantial forensic evidence would prove Mr Strauss-Kahn violently assaulted her.

Despite his defiance, the lawyer, Ken Thompson, voiced fears the district attorney's office was “laying the foundation to dismiss this case”.

Mr Strauss-Kahn, shorn of his ankle monitoring bracelet, can now travel freely in the United States pending trial and his one million bail and 5 million bond were returned, although authorities held on to his passport and he was ordered to return to court for his next scheduled hearing on July 18.

The prominent French politician resigned from his post at the world's crisis lender to fight charges that he sexually assaulted and attempted to rape a hotel maid in his luxury hotel suite in Manhattan on May 14.

Word that the case might implode has raised hopes among France's opposition Socialists that a vindicated Mr Strauss-Kahn might return to help them drive Mr Sarkozy from office in next year's elections.

“It's a thunderbolt - but in the opposite direction this time,” Socialist former PM Lionel Jospin said.

The New York Times quoted law enforcement officials as saying that within a day of the alleged rape attempt, the maid was recorded speaking on the phone with a man jailed for possessing 180kg of marijuana and discussing the benefits of pursuing charges.

The Times said he was one of several individuals who made multiple cash deposits, totalling around 100.000 USD into the woman's bank account over the last two years.

Among other discoveries about the maid, one official told the newspaper, are issues involving her asylum application and her possible links to criminal activities, including drug dealing and money laundering.