Dominique Strauss-Kahn released without bail

A New York Court just ruled that Dominique Strauss-Kahn is to be released without bail, but prosecutors are not completely abandoning the case and the ex IMF chief is due to appear again on July 18.

Strauss-Kahn is no longer required to pay for his house arrest or wear an electronic tag but cannot leave the country and return to France, CNN reported

During the hearing, the prosecution said that new evidence has caused it to reassess the case. "The case has been affected but we are not dismissing the case," CNN reported the prosecution as saying.

According to press reports, the judge has ruled that Strauss-Kahn is "free on his own recognizance" but the court decided to keep his travel documents and it is unclear which charges are still pending against him.

Ahead of the court hearing, The New York Times yesterday reported that significant problems had emerged with the case against the former IMF boss, as the credibility of the maid that accused him was now put into question by the prosecution.

According to the newspaper , the witness testimonies about herself and what she says happened to her in Strauss-Kahn's room at the Sofitel hotel in Manhattan on 14 May are not consistent, which would have led the prosecutors to seriously question the woman's credibility.

Reports also cited an official who is familiar with the case saying the issue was not necessarily about the rape accusation itself, but rather questions surrounding the alleged victim's background that could damage her credibility on the witness stand.

Strauss-Kahn has vehemently denied the accusations of rape and his lawyers have suggested that they had evidence calling into question the veracity of the housekeeper's account, but until now details about the nature of the evidences have remained vague.

He did not disput having a sexual encounter with the women, but always insisted it was consensual and reports yesterday revealed that police tape recorded a telephone conversation between the woman and a man in prison made on the day of the alleged rape in which the woman talked about the possible financial benefits that could come to her as a result of pursuing charges against Strauss-Kahn.

The New York Times also reported the investigation had also found deposits made into her bank account totalling $100,000 over the last two years, some of which came from the man, a convicted drug dealer.

Legal experts have questioned the women credibility for weeks, especially after her original lawyer, Jeffrey Shapiro, and renowned civil rights lawyer, Norman Siegel, decided to stop working with her and have since then repeatedly declined to comment about the background to the decisions.

Harvard law professor Alan Dershowitz told Newsweek earlier this month that he believed the woman's lawyers were working with Strauss-Kahn's lawyers and looking to broker a deal.

Dershowitz said: "Clearly the defendant wants to avoid trial and wants to see if he can work out a deal that's acceptable to him. And my sense is that the victim would like a big payday. Why does she want to make a deal now? Why not wait until the conviction, and then sue? [Because] the defendant doesn't have much money. All the money is his wife's money. And if you win a suit-let's assume she wins a $10m judgment against him. She's not going to collect it. He'll go bankrupt. Whereas if she settles the case, the wife pays up. So the difference is between getting, say, a million right now from the wife, or $10m from the husband which the lawyer has to spend the rest of his life chasing."

The decision of the judge indicates that the reports from the newspaper were not totally untrue but while Strauss-Kahn has now been released without bail, he is not yet a free man.