By Noeleen Walder and Emmanuel Jarry

NEW YORK/PARIS, Nov 29 (Reuters) - Former IMF chief Dominique Strauss-Kahn has reached a preliminary agreement with the hotel maid who accused him of sexual assault last year to settle a civil lawsuit she brought against him, sources familiar with the case said.

While a source in New York cautioned that the agreement could still fall apart, influential French daily Le Monde reported, citing people close to Strauss-Kahn, that the parties had agreed on a payment of $6 million to settle the case - an element dimissed by Strauss-Kahn's lawyers as "fanciful".

Le Monde said 63-year-old Strauss-Kahn and the maid, Nafissatou Diallo, would meet a judge in New York on Dec. 7 to sign the deal and close an affair that ended the Frenchman's International Monetary Fund career and wrecked his presidential ambitions.

"The discussions have been going on for weeks, months. The agreement should be confirmed at the start of next week," Michele Saban, a friend of Strauss-Kahn who saw him recently, told Reuters in Paris. She could not confirm the sum involved.

"We are moving towards the end of a tragedy," she said, adding that Diallo had always been open to negotiating a settlement despite reticence from her lawyers.

Le Monde reported that Strauss-Kahn planned to take out a bank loan for $3 million and would be lent the other $3 million by his wife Anne Sinclair, despite the fact the couple separated in the summer and now live on different sides of Paris.

Lawyers for Strauss-Kahn and Diallo based in Paris would not confirm whether a deal had been agreed and lawyers in New York did not immediately respond to requests made on Thursday evening.

"Neither Dominique Strauss-Kahn nor his lawyers will comment on proceedings in the United States. That said, however, they strenuously deny the erroneous and fanciful information relayed by Le Monde," said a statement from Strauss-Kahn's Paris legal defence team.

The New York Times, which first reported the development, also said the pair would appear before a judge in New York next week. It said the settlement sum could not be determined.

END OF THE AFFAIR

News of the U.S. deal comes as Strauss-Kahn is awaiting a decision by a French court on Dec. 19 on whether to call off a sex offence inquiry involving parties attended by prostitutes, where he risks trial on a charge of "aggravated pimping".

If that case is dropped and Diallo ends her civil case, Strauss-Kahn would have a freer rein to pursue his consultancy work and could even consider a tentative return to public life in France, where he has been shunned since the Diallo scandal.

Images of the then IMF chief paraded before TV cameras in handcuffs before being charged with attempted rape shocked the world and led to French media raking over smutty details of the former finance minister's private life.

"That's the end, not only of this affair, but of any potential affair because one of the reasons for signing this kind of agreement is that both parties agree that they will never again bring a lawsuit," Christopher Mesnooh, a U.S. lawyer who practices in France, said of the Diallo agreement.

"There will always be people who wonder about what happened in New York and in Lille, but from a legal standpoint if he gets all this behind him, he's a free man," he added.

Diallo alleged that Strauss-Kahn forced her to perform oral sex on May 14, 2011, in his suite at the Manhattan Sofitel.

The criminal prosecution fell apart after doubts emerged concerning Diallo's credibility as a witness and the attempted rape charges against Strauss-Kahn were eventually dropped.

Strauss-Kahn has maintained that the sexual encounter was consensual, although he admitted in a TV interview after his return to France that he regretted his "moral error".

Strauss-Kahn filed his own countersuit against the maid earlier this year, claiming that Diallo's accusations had destroyed his career and harmed his reputation.

In recent months, Strauss-Kahn has been making a comeback under-the-radar with a handful of speaking engagements at private conferences and by setting up a business consultancy firm in Paris.

(Additional reporting by Johnny Cotton and Thierry Leveque)

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