Treasury Used a Honey Trap for IMF Coup


The arrest of Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF) has all the hallmarks of a sting operation, a set-up scripted and staged by the American financial elite. The charges against him appear to be part of a coup to regain American control over the IMF to prevent the dollar’s slide into oblivion.

The secretive insider club that runs the U.S. Treasury Department and Federal Reserve Bank took aim at the French banker with their lowest and dirtiest weapon – the honey trap.

The objective of the collusive fraternity – as in every prior case that one of their foreign adversaries was taken down by scandals or media disinformation –   was to protect the supremacy of the Almighty Dollar from challenges by rival currencies or ingots of gold. Past targets including Japan’s former finance minister, Ryutaro Hashimoto, was hit with a videotaped sex scandal. Even a wary foe like the puritanical Chancellor Gordon Brown had to dodge a barrage of scurrilous American media attacks.

Targeted for Destruction

Strauss-Kahn, a leading critic of the dollar’s monopoly as a reserve currency, has long been in the cross-hairs of the ultra-secret intelligence operation inside Treasury. The all-powerful foreign intelligence agency with no name is one of three bureaus authorized to carry weapons within Treasury, along with the Secret Service, the presidential guard, and Alcohol, Tobacco and Firearms office, or the ATF.

His “crime” was certainly not a midnight fling that turned emotional – such dalliances happen every night in upscale suites of the Sofitel, Hyatt and Conrad in New York, Prague, Bangkok and a zillion other cities. His punishable offense was to be a European and globalist, who dared to break ranks with the Atlantic Establishment. 

Strauss-Kahn is a true son of the Enlightenment, a man of the world in every way, living  with the libertine gusto of a Rabelais or Casanova – while being perfectly sober, restrained and pragmatic in handling affairs of finance, commerce and governance.

A New Order

His sense of history was impeccable, sensing that the ancien regime in Washington – with its so-called Anglo-American consensus based on laissez-faire profiteering – is finished, bankrupt, moribund and often criminally degenerate. As his colleague, German Chancellor Angela Merkel asserted after the Wall Street collapse of 2008: The global economy needs a “new financial architecture.”

The building blocks for the new monetary order are the “special drawing rights” or SDRs, issued by the IMF. Since the formation of the international lender, in the postwar years of American hegemony, the SDRs have comprised Trilateral currencies – the U.S. dollar, the European British pound sterling, German mark, and French franc; and the Japanese yen. Now, with the euro, there are four, still reflective of the influence of the now diminished power centers of capitalism. Washington and New York – and by that we mean the Treasury and Federal Reserve – want to preserve the old order indefinitely, even though the dollar has been steadily debased by runaway federal debt and lax monetary policy.

Stauss-Kahn had the basic acumen to realize that the IMF, if it is to survive as an international lender and rule-setter for fiscal responsibility, must be solvent. The only way for restoring its credibility is to reform the SDRs into a basket of strong currencies – with the injection of the Brazilian real, Russian ruble, Indian rupee, Chinese yuan and South African rand, in other words, bank notes from the BRICS. The majority of the Group of 20, as expressed at the 2009 London Summit, favors increasing use of reformed SDRs to underwrite international lending, investment and trade.

Equal Voting Rights

That monetary revolt against the ancien regime must logically result in a change in the voting rights for the IMF board, which has been an autocratic system with the U.S. holding up to 40 percent of the votes. As the once-revolutionary Americans used to say: “No taxation without representation.” The same rule applies today.

To his everlasting credit, IMF director Strauss-Kahn nodded, accepting a transfer of 6 percent of the vote to the developing countries. Certainly not sufficient, but a good start nonetheless. In November, he asserted that a reform of voting rights will be “the biggest ever shift of influence in favor of emerging and developing countries to recognize their growing role in the global economy.”

The U.S. financial elite, like reactionary Tories from the benighted past, vowed vengeance against this modern-day Marquis de Lafayette, an elitist who betrayed his own class to support a democratic revolution by the oppressed. Revenge they got, through the media lynch mob and yet-to-be proven testimony. 

Disinformation Via Media

The initial media reports from New York were inaccurate and likely based on disinformation from U.S. intelligence operatives. 

– The Sofitel has no $3,000 per night suites, as claim in news reports. The highest room rate is $383, paid by Mr. Strauss-Kahn with a personal credit card and not charged to the IMF.

– Blood on the sheets indicates the alleged victim had been voluntary engaged in consensual intercourse prior to the claimed assault involving her  being dragged into the hotel room for oral sex.

– The IMF chief did not flee the hotel as widely reported, but met his daughter for lunch before his surprise arrest, handcuffing and being paraded before the paparazzi.

– A mobile phone, used for his IMF-related calls, was missing from his luggage, indicating another person – the actual suspect – inside his room stole the device. 

Set-Up by the Feds

On top of these disturbing inconsistencies, which indicate an entrapment scheme, a reliable source connected with British intelligence has revealed that Strauss-Kahn took the detour through New York from his office in Washington on his way to Paris at the request of officials with the U.S. Federal Reserve.

At the time, while the Obama administration pressed Congress to raise the federal debt limit, the Fed and Treasury were lobbying European central banks to defend the dollar against several major funds preparing to short-sell (dump) the dollar. Strauss-Kahn was also under White House pressure not to issue SDRs to Greece and other debt-stuck European economies, because doing so would inevitably force the IMF to turn to the BRICS for support.

Geithner and Pinochet’s Banker

After his rival’s jailing, U.S. Treasury Secretary Timothy Geithner proposed his own candidate to replace Strauss-Kahn as IMF managing director – American John Lipsky. The U.S. appointee to the deputy director slot, Lipsky has had long-association with the defunct and scandal-ridden Salomon Brothers and served as the IMF representative to the Pinochet regime in Chile from 1978 to 1980.

As for the late Ryutaro Hashimoto, the Japanese finance minister was similarly caught by secret camera in a Tokyo love hotel. Just before the first Gulf War invasion, he had steadfastly refused the Bush White House demands for a $16 billion contribution to the war. When he arrived at the Plaza Hotel in New York, U.S. Treasury Secretary Nicholas Brady presented him with the embarrassing videotape. Hashimoto had no choice but to cough up the money. 

The world’s diplomatic corps is familiar with dozens,even  hundreds of such stories involving the honey trap. A legal term for using debauchery as a weapon is blackmail, a felony punishable by a mandatory prison sentence. Dominique Strauss-Kahn is a victim of a crime worse than the dubious charges against him. As for the wise men of the Federal Reserve and their henchmen in Treasury, they richly deserve a lifetime behind bars and a fistful of dollars to pay for a cigarette.

Yoichi Shimatsu, a Hong Kong-based journalist, editor-at-large of 4th Media.

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