The weekend arrest of Dominique Strauss-Kahn sent shockwaves through the financial world and upended French presidential politics, but it also quickly gave rise to theories about whether the International Monetary Fund chief had been set up by rivals.

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Prior to his imprisonment at Riker’s Island on charges of attempted rape, the globetrotting Strauss-Kahn wielded considerable power. As head of the monetary fund — which provides emergency loans to countries in severe distress and monitors global financial stability — Strauss-Kahn was a frequent guest of lawmakers and leaders of the banking industry.

And as a prominent member of France’s Socialist party, he was widely considered to be one of the strongest potential challengers next year to President Nicolas Sarkozy.

The financial titan — who carries a reputation for womanizing — became an immediate talking point: For some, the story represented a sad fall from grace; others spoke of humiliation for France; but, for another group, it smacked of a set-up.

‘Yes, I love women…so what?’
In a strange twist, Strauss-Kahn himself lit the fuse for theorists and supporters just two weeks ago. During an interview with French newspaper Liberation, the IMF chief predicted that his enemies could use his proclivity for promiscuity against him if he chose to run for president of France.

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When asked what challenges he faced in a possible bid, Strauss-Kahn replied, “The money, women and my Jewishness.”

“Yes, I love women … so what? […] For years we talk about giant pictures of orgies,” he told Liberation. “But I’ve never seen anything out … Let show them!”

The IMF chief went on to admit that he could see himself being set up because of his affinity for women. According to a translation done by British newspaper The Guardian, Strauss-Kahn goes on to admit that he could see himself becoming the victim of a honey trap: “a woman raped in a car park and who’s been promised 500,000 or a million euros to invent such a story… .”

‘It is totally hallucinatory’
Strauss-Kahn’s supporters took to his defense almost immediately after his arrest.

“I am convinced it is an international conspiracy,” Michelle Sabban, senior councilor for the greater Paris region, told The Telegraph.

“It’s the IMF they wanted to decapitate,” she said. “It’s not like him. Everyone knows that his weakness is seduction, women. That’s how they got him.”

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Video: IMF chief spends night in tough N.Y. jail (on this page)

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.

“He is a brave man on whom a contemptuous fate has been inflicted,” former Socialist culture minister Jack Lang told Europe 1 radio, complaining of a “lynching.”

“It is not unthinkable that certain judicial officials, the prosecutor in particular or the judge, is driven by a desire to take down a Frenchman, a Frenchman who is moreover well known.”

Strauss-Kahn and his supporters aren’t the only ones who think he could have been set up for a fall. According to The Telegraph, some of Strauss-Kahn’s rivals even found the news tough to believe.

“It is totally hallucinatory. If it is true, this would be a historic moment, but in the negative sense, for French political life,” said Dominique Paille, a political rival to Strauss-Kahn on the center right, television, according to The Telegraph. “I hope that everyone respects the presumption of innocence. I cannot manage to believe this affair.”

According to The Telegraph, Henri de Raincourt, minister for overseas co-operation in President Nicolas Sarkozy’s government refused to rule out the notion of a trap during a broadcast interview.

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“I refuse to have a personal opinion and say, ‘Yes it was a trap,’ or ‘No, it wasn’t a trap.’ I don’t know,” he said.

Lawyers for Strauss-Kahn claim the IMF chief was at lunch with his daughter when the assault is said to have occurred, and that he is not guilty.

But according to the Associated Press , Assistant District Attorney John “Ardie” McConnell said the victim “provided a very powerful and detailed account of the violent sexual assault,” and added that forensic evidence may support her telling of the encounter.

Previous affair
An employee who had a brief affair with Strauss-Kahn said she warned the organization about his behavior toward women in a letter sent three years ago.

The person who confirmed the existence of the letter is close to the former International Monetary Fund employee, Hungarian-born economist Piroska Nagy. The person declined to be identified, citing the sensitivity of the matter.

Nagy, who had worked at the IMF for decades, left the organization after the affair with Strauss-Kahn in 2008. An IMF-funded investigation into the affair cleared Strauss-Kahn of wrongdoing but criticized his judgment. The affair was back in the news after the 62-year-old Frenchman’s incarceration on sex crimes charges in New York.

Nagy now works with the European Bank for Reconstruction and Development in London.