IMF examines chief's alleged relationship with female staffer

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Washington, Oct 19 (UNI) The International Monetary Fund (IMF) has hired an outside firm to investigate whether its Managing Director Dominique Strauss-Kahn abused his position by having an affair with a female staffer who later left the organisation with financial compensation.

The Washington Post, quoting sources familiar with the probe, said the IMF confirmed yesterday that it has contacted law firm Morgan, Lewis&Bockius to conduct the investigation.

The focus is whether Mr Strauss-Kahn, France's former Finance Minister who came to the top job at the IMF in September 2007, acted improperly in connection with an alleged sexual relationship he had with a former division chief at the fund, Piroska Nagy.

Nagy left her position in the Africa department of the IMF this summer as rumours of her possible relationship with Strauss-Kahn began to surface.

In a brief interview in August, soon after her departure, Nagy, now an economist with the European Bank for Reconstruction and Development in London, would not confirm or deny the affair.

She said she had left her job after almost two decades at the fund ''as part of the normal downsizing at the IMF.'' She declined to disclose the size of her severance package, but said it was ''no more'' than her years of service and salary levels had warranted.

The daily said results of the outside investigation are scheduled to be presented to the board by the end of the month.

In a statement, Mr Strauss-Kahn, 59, also did not confirm or deny the affair, but he said he had not acted improperly. ''With my full support, the IMF is examining an incident which occurred in my private life in January,'' he said.

''I have cooperated and am continuing to cooperate with outside counsel to the Fund concerning the matter. At no time did I abuse my position as the Fund's Managing Director. I look forward to the report of outside counsel,'' he added.

UNI XC SKB KP1930

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