NY Gov. Spitzer Apologizes But Does Not Resign

Gov. Eliot Spitzer, accused in news reports of being involved in a prostitution ring, apologized to his family and the public on Monday at a hastily called news conference. He did not elaborate on the story.

Mary Altaffer / AP New York State Gov. Eliot Spitzer is joined by his wife Silda as he makes a statement to reporters during a news conference Monday, March 10, 2008 in New York. Spitzer has apologized to his family and the public, but did not elaborate on a bombshell report that he was involved in a prostitution ring. (AP Photo/Mary Altaffer)

Spitzer stood next to his stone-faced wife and bit his lips, telling reporters: "I have acted in a way that violates my obligations to my family."

"I have disappointed and failed to live up to the standard I expected of myself," he said. "I must now dedicate some time to regain the trust of my family."

As he walked out, reporters shouted: "Will you resign?" He did not answer.

The New York Democrat's involvement in the ring was caught on a federal wiretap as part of an investigation opened in recent months, according to a law enforcement official who spoke to The Associated Press on condition of anonymity because of the ongoing inquiry.

Four people allegedly connected to the ring, identified in court papers as the Emperors Club VIP, were arrested last week. (Related Story). The ring arranged connections between wealthy men and more than 50 prostitutes in New York, Washington, Los Angeles, Miami, London and Paris, prosecutors said.

CNBC confirmed that Spitzer is the client referred to as "client-9" in a complaint unsealed in federal court in Manhattan (click here for PDF of the document) that charges several people with organizing and managing the prostitution ring. Client-9 paid to bring the prostitute named "Kristen" from New York to Washington for a four-hour tryst at a hotel on Feb. 13.

The court papers gave this account of the encounter: A defendant, Temeka Rachelle Lewis, confirmed that Client 9 would be "paying for everything -- train tickets, cab fare from the hotel and back, mini bar or room  service, travel time, and hotel."

The client paid $4,300 in cash to the service, with some being used for the encounter and the rest apparently to be used for credit. When discussing how the payments would be arranged, Client 9 told Lewis: "Yup, same as in the past, no question about it," suggesting it was a routine exchange.

The prostitute, who authorities described as a "petite, pretty brunette, 5-feet-5 inches, and 105 pounds," met the client in Room 871 at about 10 p.m.

In a conversation with the booking agent, Kristen said that she liked the client and that she did not think he was difficult.

The agent said she had been told the client "would ask you to do things that ... you might not think were safe ... very basic things," according to the papers, but that Kristen responded by saying, "I have a way of dealing with that ... I'd be, like, listen dude, you really want the sex?"

The Web site of the Emperors Club VIP displays photographs of scantily clad women with their faces hidden. It also shows hourly rates depending on whether the prostitutes were rated with one diamond, the lowest ranking, or seven diamonds, the highest. The most highly ranked prostitutes cost $5,500 an hour, prosecutors said.

(See CNBC footage of Spitzer's statement at left.)

Mr. Spitzer appeared on CNBC at 7 a.m. the next morning following the Feb. 13 meeting. (See the video of his appearance here). Later in the morning, he testified before a Congressional committee.

Spitzer has not been charged, and prosecutors did not comment on the case. The four defendants charged in the case last week were charged with violating the federal Mann Act, a 1910 law that outlaws traveling across state lines for prostitution.

Sources told CNBC that Spitzer does not plan to resign until he manages to organize a plea deal that will allow him to avoid prosecution under the Mann Act.

CONTINUED : 'Crusader of the Year' Faces Tough Accusations

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