Former IMF head Dominique Strauss-Kahn is placed under formal investigation after being questioned by magistrates in the northern French city of Lille.
The investigation on suspicion of complicity in a pimping operation is the latest judicial headache for the Socialist ex-finance minister. The move could lead to a trial but it falls short of charging him.
Dominique Strauss-Kahn, 62, who was a strong contender to be France's next president until he was hit with sex assault charges, now-dismissed, in New York last May, was allowed to leave the court after being questioned by three judges in the case.
The Lille case centres on allegations that a prostitution ring organised by Strauss-Kahn's business associates supplied clients at the city's Carlton Hotel.
In a statement, Mr Strauss-Kahn's lawyer Richard Malka maintained the former IMF chief's innocence: "Mr Dominique Strauss-Kahn has today been formally placed under investigation for pimping. He declares in the strongest terms that he is not guilty of any of these acts, and particularly that he was never aware of the fact that some women he encountered might have been prostitutes.
"Most particularly, Mr Strauss-Kahn could not have known about the details of these women's remunerations. He would to remind us that as he has never gone to the Carlton Hotel in Lille, this element of the investigation does not concern him.
"Furthermore, supposing even that he had known the status of the women in question, we have to remember that the fact of having relations with an escort would not be an infraction of French law and would be a question of an entirely legitimate private matter between consenting adults."
21 February 2012