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The fall of Eliot Spitzer: "Client Number 9?" Update: Report – Expected to resign; Report – indicted?; Update: "I apologize to my family. I apologize to the public." Rumor: Resignation at 7pm?; Federal wiretap info; Wall Street cheered; Update: The alias ("George Fox") and the affidavit

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By Michelle Malkin  •  March 10, 2008 01:24 PM

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Scroll down for updates…3:00pm Eastern Spitzer is expected to resign…Wow. This is an astounding turn of events for a ruthlessly ambitious, self-styled crusader against corruption. Proverbs 16:18, anyone?…3:06pm Eastern Fox sources reporting that Spitzer has been indicted in the Emperors’ Club case (update – Fox clarifies that it’s not an indictment, but a sealed criminal complaint…here it is…)…3:15pm Eastern. Via WCBSTV, which livestreamed Spitzer’s brief statement: “I apologize to my family. I apologize to the public to whom I promised better…I do not believe in the long run that politics is about individuals…I failed to live up to standard I expected of myself…I must now dedicate some time to regain the trust of my family…I will get back to you in short order”…No questions. No reference to the prostitution ring. No reference to resigning. No reference to indictment….WCBS reports Albany buzz about possible resignation at 7pm and swearing-in of Lt. Gov. David Paterson…WCBS TV’s Marcia Kramer was in the room for Spitzer’s statement. She says his wife was by his side….Allah notes information about Spitzer getting caught on a federal wiretap…His alias? George Fox…here’s the affidavit…

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Mr. Clean–you know, the guy who called himself a “f–king steamroller” –comes clean:

Gov. Eliot Spitzer has informed his most senior administration officials that he had been involved in a prostitution ring, an administration official said this morning.

Mr. Spitzer, who was huddled with his top aides inside his Fifth Avenue apartment early this afternoon, had hours earlier abruptly canceled his scheduled public events for the day. He scheduled an announcement for 2:15 after inquiries from the Times.

Mr. Spitzer, a first term Democrat who pledged to bring ethics reform an end the often seamy ways of Albany, is married with three children.

Just last week, federal prosecutors arrested four people in connection with an expensive prostitution operation. Administration officials would not say that this was the ring with which the governor had become involved.

But a person with knowledge of the governor’s role said that the person believes the governor is one of the men identified as clients in court papers.

The governor’s travel records show that he was in Washington in mid-February. One of the clients described in court papers arranged to meet with a prostitute who was part of the ring, the Emperors Club VIP on the night of Feb. 13.

Mr. Spitzer appeared on a CNBC television show at 7 a.m. the next morning. Later in the morning, he testified before a Congressional committee.

An affidavit filed in federal court in Manhattan in connection with that case lists six conversations between the man, identified as Client 9, and a booking agent for the Emperors Club.

He had a difficult first year in office, rocked by a mix of scandal and legislative setbacks. In recent weeks, however, Mr. Spitzer seemed to have rebounded, with his Democratic party poised to perhaps gain control of the state Senate for the first time in four decades.

Mr. Spitzer gained national attention when he served as attorney general with his relentless pursuit of Wall Street wrongdoing. As attorney general, he also had prosecuted at least two prostitution rings as head of the state’s organized crime task force.

JWF notes this passage:

As attorney general, he also had prosecuted at least two prostitution rings as head of the state’s organized crime task force.

In one such case in 2004, Mr. Spitzer spoke with revulsion and anger after announcing the arrest of 16 people for operating a high-end prostitution ring out of Staten Island.

“”This was a sophisticated and lucrative operation with a multitiered management structure,” Mr. Spitzer said at the time. ”It was, however, nothing more than a prostitution ring.”

He had been scheduled to meet with family planning activists this morning and canceled. NY politicos are “shocked.” Very sad for his family. Allah will have vid of the press conference.

More about the prostitution ring, the Emperor’s Club…Is Spitzer “Client Number 9?”

Four organisers and managers of the international ring were arrested by US authorities and charged with conspiracy to violate federal prostitution laws, Newsday.com reported.

Another two of the men were also accused of attempting to launder more than $1.08 million in illicit proceeds from business.

The ring was known as the Emperor’s Club VIP and offered 50 prostitutes in New York, Paris, Washington, Miami and London, The New York Times reported.

The appointments, made through an online booking service, cost between $1076 and $5921 an hour.

The United States attorney’s office said the leader of the ring was Mark Brener, 62, of New Jersey, who delegated operational duties to Cecil Suwal, 23, also of New Jersey, the newspaper reported.

Suwal oversaw the ring’s accounts and oversaw two booking agents, Tameka Rachelle Lewis, 32 of Brooklyn, and Tanya Hollander, 36, of Rhinebeck, New York, according to court papers quoted by the paper.

If found guilty, Lewis and Hollander face a maximum of five years in prison.

Brener and Suwal each face an additional 20 years in prison, if convicted of the money laundering charge.

The group’s website, which can be access through an internet archiving service, described its services in an indirect manner.

A section of the site, Portfolio, had a selection of photos of women, all with their faces obscured.

Under each photo and mononym was a rating using diamond symbols that ranged from three to seven.

“We offer a convenient variety of services globally,” the introduction to a 2007 version of the site states.

“Specializing [sic] in deluxe concierge, model introduction, spokes model and contemporary art is our expertise.

“We act for a select group of educated, refined and successful international clients who give their best in all they do and who, in return, only wish to receive the best.

“Our meticulous standards ensure that you always experience the quality you’ve come to expect in a world-class service when working with Emperors’ Club vip.

“Best of all, our innovative social introduction / dating services allow you a luxuriously enjoyable dating / travel experience with ‘no strings attached.’

The NYSun:

Mr. Spitzer, who abruptly this morning canceled his scheduled meetings today in Albany, alerted his staff today that he was connected to an investigation of a prostitution service that charged up to $5,500 an hour.

The New York Sun reported today that prosecutors specializing in government corruption cases are leading the investigation into the prostitution service, suggesting that the U.S. attorney’s office in Manhattan may have evidence that a public official hired a prostitute.

Federal prosecutors last week unsealed a criminal complaint charging four people with running Emperors Club VIP, which advertised itself as an escort service. Prosecutors say the Emperors Club employed more than 50 high-end prostitutes.

Flip Pidot: From Troopergate to Shtupergate.

Lawhawk plays Name That Party.

***
Timeline…Fox reporting that Spitzer may have been in D.C. on Feb. 13, cellphone records reportedly show him contacting the Emperor’s Club that night, then appearing on Capitol Hill early the next morning.

Via the US Attorney’s Office press release, March 6, re. the Emperors’ Club bust:

MICHAEL J. GARCIA, United States Attorney for the Southern District of New York, MARK J. MERSHON, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and PATRICIA J. HAYNES, Special Agent-in-Charge of the New York Field Office of the United States Internal Revenue Service-Criminal Investigative Division (“IRSCID”), announced today the unsealing of charges against MARK BRENER, a/k/a “Michael,” CECIL SUWAL, a/k/a “Katie,” a/k/a
“Kate,” TEMEKA RACHELLE LEWIS, a/k/a “Rachelle,” and TANYA HOLLANDER, a/k/a “Tania Hollander,” for their roles as organizers and managers of an international prostitution and money-laundering ring called the Emperors Club VIP (the “Emperors Club”). All four defendants were charged with conspiracy to violate federal prostitution statutes; BRENER and SUWAL were also charged with conspiring to launder more than $1 million in illicit proceeds from the prostitution crimes. BRENER, SUWAL, LEWIS, and HOLLANDER were all arrested this morning, and are expected in Manhattan federal court later today for their initial appearances. According to the Complaint unsealed today:

BRENER, SUWAL, LEWIS, and HOLLANDER used the Emperors Club to arrange connections between wealthy male clients and more than 50 prostitutes in, among other places, New York, New York; Washington, D.C.; Los Angeles, California; Miami, Florida; London, England; and Paris, France. The defendants charged the
clients fees ranging from $1,000 to more than $5,500 per hour for prostitution services.

The Emperors Club took in more than $1 million in illicit proceeds from its international prostitution business. It accepted payment in the form of cash, American Express
charges, wire transfers, and money orders. To conceal the illegal nature of the business, BRENER and SUWAL received prostitution proceeds in United States bank accounts in the names
of front companies, including two accounts in the names of “QAT Consulting Group, Inc.,” and “QAT International, Inc.” The Emperors Club advertised their prostitution
services in part through the use of a website that included photographs of Emperors Club prostitutes’ bodies, with their faces hidden, along with hourly rates for different categories of
prostitutes. The Website ranked the prostitutes using a ranking system from one to seven diamonds, and charged hourly rates according to the assigned ranking. According to the Website, the Emperors Club charged $1,000 per hour for a three-diamond prostitute, and $3,100 per hour for a seven-diamond prostitute. The Website also offered the Emperors Club’s most valued clients “membership” in the “Icon Club,” a status which allowed the clients to access restricted areas of the Website and permitted them to schedule appointments with the most highly-ranked prostitutes, whose fees started at $5,500 per hour. According to the Website, in certain circumstances, the Emperors Club also
offered its clients the opportunity to exercise a “buy-out clause,” which permitted them to purchase direct access to one of the Emperors Club’s prostitutes without having to contact the agency.

BRENER was allegedly the leader of the Emperors Club, with ultimate decision-making authority. He recruited prospective prostitutes, determined how to market the Club’s
prostitutes to clients, and resolved problems that arose. SUWAL was the day-to-day organizer of the Club’s operations. She controlled the Emperors Club bank accounts,
supervised the booking agents, and received applications from the prospective prostitutes.

LEWIS and HOLLANDER were allegedly booking agents for the Club. They took requests from clients and coordinated meetings with prostitutes over the telephone, and referred issues relating to payment to SUWAL.

In connection with today’s takedown, the FBI and IRS-CID executed three search warrants on locations connected to the Emperors Club’s operations and four seizure warrants for bank
accounts containing proceeds of the organization’s criminal activities.

BRENER, 62, and SUWAL, 23, both reside in New Jersey; LEWIS, 32, resides in Brooklyn, New York; and HOLLANDER, 36, resides in Rhinebeck, New York. If convicted, the defendants
face maximum sentences of 5 years in prison on the count charging conspiracy to violate the federal prostitution statutes; BRENER and SUWAL face additional maximum sentences of 20 years in prison on the money-laundering conspiracy count.

Mr. GARCIA praised the investigative work of the FBI and IRS-CID.

Assistant United States Attorneys BOYD M. JOHNSON III, RITA GLAVIN, and DANIEL STEIN are in charge of the prosecution. The charges contained in the Complaint are merely
accusations and the defendants are presumed innocent unless and until proven guilty.

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Update 4:10pm Eastern. Brenda Buttner on FNC reports that Wall Street cheered upon hearing the news of Spitzer’s troubles. The joke among traders about the Emperors’ Club scandal is that Spitzer the Emperor had no clothes–literally.

Update 4:13pm Eastern. More on the wiretap.

Update 5:30pm Eastern. Ed Morrissey takes a short trip down Spitzer memory lane.

Update 8:00pm Eastern. Suspicious money transfers tipped the feds off.

More affidavit details.

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