A one-night stand has endangered the stellar career of the French head of the International Monetary Fund and dismayed President Sarkozy as he seeks to put a French stamp on a new world financial order.

The news that Dominique Strauss-Kahn, 59, is being investigated in Washington over a fling with a former subordinate has unsettled Sarkozy because he has mounted an effective double act with him in the effort to manage the financial crisis.

Sarkozy has teamed up with "DSK," a political opponent whom he sent to Washington, in an attempt to shape a new "Bretton Woods" pact on financial regulation.

Visiting President Bush at Camp David yesterday, Sarkozy presented a vision for this on behalf of the European Union that conflicts with US wishes. Although Strauss-Kahn's romantic troubles had been known in Paris for weeks, some politicians suggested that the case had been leaked to the U.S. media at the weekend in order to undermine the French effort.

Strauss-Kahn is also leading the IMF's drive to soften the blow of recession on weaker economies.

Click here for the full report from the Times of London.