Law enforcements officials have told The New York Times that the sexual assault case against former International Monetary Fund chairman Dominique Strauss-Kahn could soon collapse because they have uncovered "major holes in the credibility of the housekeeper" who filed the charges.
If true, these new developments represent a stunning reversal of fortune for Strauss-Kahn, whose financial and political career all but disintegrated when he was arrested just six weeks ago.
"It's not at all unusual for defense attorneys to attack the credibility of alleged witnesses in a case - you see it all the time. It is very unusual to see the prosecution questioning the credibility of their own witnesses, especially in a case as high profile as this," CBS News legal analyst Jack Ford said on "The Early Show."
"When you have that coming from the prosecution side as reportedly it is here, that means there's some possibility for some seismic changes in the case."
The woman, a 32-year-old from Guinea, charged that Strauss-Kahn assaulted her and forced her to commit a sex act when he came upon her while she was cleaning his $3,000-a-night suite at New York's Sofitel Hotel. Forensic evidence confirms a sexual encounter between the two took place.
But now, prosecutors "do not believe much of what the accuser has told them," and they say she has "repeatedly lied."
Investigators also reportedly have evidence that could link the unidentified woman to drug dealing and money laundering, reports CBS News correspondent Elaine Quijano.
In one recorded phone call - placed the day after the encounter - she spoke to a man in prison about "the possible benefits of pursuing the charging against him."
"There are a couple of things that the prosecution can be questioning here," said Ford. "They could be questioning whether the facts that she's given them are in fact true. Or they could be questioning just whether her background is so questionable that it would be difficult for them to put her on the stand and expect the jurors to believe them.
"Defense attorneys have the ability to question an alleged victim about a lot of things, not just what happened then, and one of the things defense attorneys always try to do, to stress if somebody is unreliable. You could anticipate if this ever went to trial defense attorneys would be focusing on all these other things to get jurors to believe she's not telling the truth.
"So we don't know exactly what's going on here," said Ford, "but it is a big deal for them to be questioning the integrity of their own witness."
CBS News has been told charges against Strauss-Kahn are not expected to be dropped, but his extraordinary bail arrangement will be reviewed by a judge when Strauss-Kahn and his attorney return to federal court later today.
Strauss-Kahn - who was considered a strong contender for the French presidency before the May 14 charges were filed - paid a $6 million cash bail after his initial court appearance. He also spends an estimated $200,000 a month on security guards and surveillance cameras.
Now that bail and those required security measures may be substantially reduced, and he could be released on his own recognizance.
"It's not unusual to go back to a judge during the course of a case and ask for changes to be made in bail," said Ford. "But those changes are usually requested by the prosecution when they say, 'We've got more information, we've got more bad stuff on this guy, we want to you jack this all up.' For the defense to come in and say, 'We want you now to change this, make it less restrictive,' it means there has to be something.
"Maybe the judge will be told off the record in a conference with both sides or maybe it'll come on the record, but it really strongly suggests there are very, very serious problems here, and even the prosecution is backing away from [Strauss-Kahn] at this point."