Former IMF chief Dominique Strauss-Kahn and his wife Anne Sinclair leave the apartment where they are staying in New York on Saturday, his first full day of freedom from house arrest. Jessica Rinaldi / Agence France-Presse

Ex-IMF chief chased by army of photographers in New York

NEW YORK - Buoyed by a New York judge's order a day earlier to end all restrictions on him except foreign travel, former managing director of the International Monetary Fund (IMF) Dominique Strauss-Kahn was enjoying his first full day of freedom from house arrest on Saturday as prosecutors scrambled to salvage some sort of case against the once high-flying French politician.

He left his rented townhouse in Lower Manhattan with his wife Anne Sinclair for several hours in the afternoon, chased by an army of photographers and news teams across the city.

Their black Mercedes sedan made several attempts to duck the reporters, at one point rushing into Time Warner Center's parking garage, whose doors closed immediately afterward, only to re-emerge out the other side.

They likely toured the Museum of Modern Art during their outing, as Sinclair held a guidebook from the museum upon returning home. Other destinations were unknown.

An older couple later visited the townhouse, carrying bags that seemed to be filled with groceries. The woman wore a white summer dress and the man a blue suit. Both had dined with Strauss-Kahn and his wife the night before at a posh Italian restaurant on the Upper East Side, running a tab of around $600.

It was a stunning reversal of fortune for a man who spent days locked up in New York's tough Rikers Island jail in May.

While the charges against the 62-year-old stand, the case has nearly imploded after prosecutors acknowledged their investigations of the accuser, a Guinea-born hotel maid, found she lied to a grand jury about the case.

In a letter to defense lawyers, Manhattan District Attorney Cyrus Vance said the woman had provided a "false" narrative of her life - including a gang rape which she later admitted never occurred - as part of her application process for US asylum.

Among other details gleaned about the maid were her possible links to criminal activities, including drug dealing and money laundering, a law enforcement official told The New York Times.

Within a day of the alleged rape attempt, the maid was recorded speaking on the phone with a boyfriend jailed for possessing 180 kg of marijuana and discussing the benefits of pursuing charges, according to the newspaper.

When the conversation was translated from Fulani, the maid's native language, investigators became concerned.

"She says words to the effect of, 'Don't worry, this guy has a lot of money. I know what I'm doing'," the Times quoted one of the officials as saying.

The paper said the man was one of several individuals who made multiple cash deposits totaling around $100,000 into the woman's bank account over the last two years.

The sensational twist raised hopes among Strauss-Kahn's ardent supporters that the case will collapse and the Socialist party favorite will return to frontline politics, possibly even as a candidate to challenge French President Nicolas Sarkozy in 2012 elections.

In a hint of just how possible a Strauss-Kahn bid may be, fellow socialist Segolene Royal, a candidate in the presidential vote, said she had no problem delaying the process to make room for him.

But the current deadline for declaring in the Socialist Party primary is July 13 - five days before Strauss-Kahn's next scheduled court appearance in New York.

And authorities will keep his passport pending possible trial, meaning he cannot travel outside of the United States, though his $1 million bail and $5 million bond will now be returned.

Despite the maid's shattered credibility, Vance vowed to continue the investigations until prosecutors had uncovered all the facts.

"Today's proceedings did not dismiss the indictment or any of the charges against the defendant," he stressed.

Judge Michael Obus concurred, telling the court: "The case is not over ... In the meantime, there will be no rush to judgment."

Legal analysts, however, said the case was likely dead in the water and would be dismissed.

According to the accuser's initial grand jury testimony, she fled Strauss-Kahn's luxury hotel suite immediately after the May 14 attack and waited in the hallway before informing a supervisor.

But, prosecutors revealed, the 32-year-old subsequently changed her story, admitting she actually cleaned another room and even returned to start cleaning Strauss-Kahn's suite before alerting her bosses.

Strauss-Kahn's attorneys William Taylor and Benjamin Brafman said the disclosures "only further confirm that he will be fully exonerated".

Outside the courtroom, the maid's lawyer Kenneth Thompson admitted his client had made "some mistakes", but insisted forensic evidence would prove Strauss-Kahn was guilty of a brutal sexual assault.

Agence France-Presse