Ex-IMF chief freed - maid's credibility in doubt NEW YORK

Former International Monetary Fund leader Dominique Strauss-Kahn leaves New York State Supreme court with his wife Anne Sinclair, Friday, July 1, 2011, in New York. A judge has agreed to free Strauss-Kahn without bail or home confinement in the sexual assault case against him. The criminal case against him stands. less Former International Monetary Fund leader Dominique Strauss-Kahn leaves New York State Supreme court with his wife Anne Sinclair, Friday, July 1, 2011, in New York. A judge has agreed to free Strauss-Kahn ... more Photo: Louis Lanzano, AP Photo: Louis Lanzano, AP Image 1 of / 5 Caption Close Ex-IMF chief freed - maid's credibility in doubt 1 / 5 Back to Gallery

New York --

In a twist that could signal the collapse of the sexual assault case against former International Monetary Fund chief Dominique Strauss-Kahn, a judge Friday lifted his house arrest and bail after prosecutors admitted a "substantial credibility issue" with the hotel maid who accused him of trying to rape her.

Among other things, the woman lied on her asylum application about having been gang-raped in the past and repeated the lie in interviews with attorneys from the Manhattan district attorney's office, according to a letter submitted by prosecutors.

Strauss-Kahn looked grim as he walked out of the courtroom but broke into a smile as he emerged onto the streets of Manhattan with his wife, Anne Sinclair. His attorney, Benjamin Brafman, called Judge Michael Opus' move a "giant step in the right direction."

But prosecutors noted that Strauss-Kahn, 62 - one of France's most powerful political figures, who had been considered a contender to become its next president - remains under indictment. "Today's proceedings did not dismiss the indictment, or any of the charges," said District Attorney Cyrus Vance Jr. "Our prosecutors will continue their investigation into these alleged crimes."

And Kenneth Thompson, an attorney representing the 32-year-old accuser, said that no matter what inconsistencies may have emerged in the woman's accounts of her life in her native Guinea, and of her encounter with Strauss-Kahn, they should not derail the case. "She was violently attacked in that room," Thompson said angrily outside the courthouse.

The turnaround was an embarrassment to prosecutors, who had initially portrayed the woman as highly credible and whose trumpeting of the case against Strauss-Kahn - everything from a semen sample to his arrest minutes before he was due to fly to France - fueled sensational media coverage and public abhorrence.

Under terms of the agreement between prosecutors and the defense, Strauss-Kahn still may not travel out of the United States, but bail was lifted and he was granted the freedom to leave his apartment.

A letter sent to Strauss-Kahn's legal team Thursday and signed by prosecutors outlined some of the discrepancies that led them to question the accuser's credibility. They included the woman's admission that she had lied on her tax returns and about her actions in the minutes after the alleged attack in Strauss-Kahn's Manhattan hotel room.

But most damning may have been her admission that claims of having been gang-raped in her West African homeland were lies intended to help her win asylum in the United States.

Since she was expected to be the key witness against Strauss-Kahn, the blows to her integrity could doom the prosecution's chances of getting a conviction, said former federal prosecutor Laurie Levenson, who teaches criminal law at Loyola Law School.

"It's all about the alleged victim's credibility," Levenson said.