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NY guv embroiled in sex scandal

world Updated: Mar 12, 2008 02:46 IST

Reuters
Highlight Story

New York Gov Eliot Spitzer, the one-time ‘Sheriff’ of Wall Street who campaigned on a promise to clean up state politics, was embroiled in a sex scandal on Monday that threatened to force his resignation.

A New York Times report linked him to a $1,000-an-hour prostitute, saying he was caught on a federal wiretap at least six times on Feb. 12 and 13 arranging to meet with her at a Washington hotel last month.

The Times said he was the man described in court papers as Client 9 who patronised the Emperors Club, which federal investigators allege was a prostitution ring whose most expensive professionals charged more than $5,500 an hour.

Spitzer, a married 48-year-old Democrat who investigated prostitution as New York’s attorney general, apologised for what he described as “private matter” but said nothing about resigning. State Republicans called for him to step down.

The state capital, Albany, was rife with speculation about when Spitzer would resign and whether he would be charged with a crime. Prosecutors rarely bring charges against clients of prostitutes in such cases.

“I have acted in a way that violated the obligations to my family and that violates my — or any — sense of right and wrong. I apologise first, and most importantly, to my family. I apologise to the public whom I promised better,” the father of three daughters told reporters in New York City with his wife, Silda Wall Spitzer, at his side.

“I am disappointed that I failed to live up to the standard that I expect of myself. I must now dedicate some time to regain the trust of my family.”

The news rocked Wall Street, where power brokers resented Spitzer’s high-profile inquiries into financial cases when he was New York state’s chief prosecutor.

“Get ready for a schadenfreude festival on Wall Street,” said Barry Ritholtz, director of equity research at Fusion IQ.

It also sent shock waves through the Democratic Party. Spitzer has been described a rising star in the party and is pledged to support presidential candidate Sen. Hillary Clinton of New York as a superdelegate at the Democratic Party convention in August that will choose
the party’s nominee for the November election.

As state attorney general before being elected governor in 2006, Spitzer built his reputation going after white-collar crime on Wall Street. As governor, he vowed to clean up state politics.

Time Magazine named him “Crusader of the Year” in 2002 after his landmark settlement with 10 of the country’s largest securities firms over charges of misleading investors.

The New York Times, citing an administration official, reported that Spitzer had told his top administration officials he had been involved in a prostitution ring that federal authorities had been investigating.

The Emperors Club website once described it as a provider of “beautiful, sensual and discreet escorts.”

Spitzer is the individual identified as Client 9 in court papers that were filed last week when four people were charged with running a multimillion-dollar international prostitution ring, the Times reported, citing unidentified sources.

Client 9 arranged to meet with “Kristen,” a prostitute who charged $1,000 an hour, on Feb 13 in room 871 of a Washington hotel and paid $4,300 for services rendered and as a down payment for future engagements.

They describe six telephone calls between Client 9 and one of the defendants that were intercepted by wiretaps on Feb. 12 and 13.