Spitzer's Next Move: Resignation?

"These are serious and disturbing accusations that are completely at odds with the man I know. They come as a complete shock," said New Jersey Gov. Jon Corzine. "As the governor said, his actions are a clear violation of his own sense of right and wrong. He will have to regain credibility not only with his family but with the public."

ABC has confirmed that Spitzer stayed at the Mayflower Hotel in Washington on the night of Feb. 13 and testified before Congress the following morning on the state of the bond industry.

Last week, federal prosecutors arrested four people in connection with an expensive prostitution operation called the Emperors Club. The club charged up to $5,500 an hour for one if its prostitutes, who were rated on its Web site on a scale of one to seven diamonds.

According to a federal complaint, more than $1 million was laundered through the ring in four years.

Administration officials would not say whether this was the ring with which the governor allegedly became involved. The federal complaint mentions an Emperors Club suspect identified as "Client 9."

Federal law enforcement sources confirmed that Spitzer was the Client 9 named in the complaint against four people indicted after the investigation.

The complaint says Spitzer allegedly spent about $4,300 on the services of a prostitute identified only as Kristen. He paid for her to travel: "train tickets, cab fare from the hotel and back, mini bar or room service, travel time and hotel."

Kristen was described to Spitzer as "an American, petite, very pretty brunette, 5 feet, 5 inches, and 105 pounds," according to the complaints.

Law enforcement sources said the governor allegedly made a series of calls to arrange for a prostitute to come to his hotel room at 8:47 p.m., telling her that the door to his room would be left open, according to federal court papers.

According to the same set of federal documents, the governor may also have asked prostitutes to engage in "unsafe" sex.

Ironically it was Spitzer who led investigations to the Emperors Club after a series of unusual financial transactions that Spitzer made were forwarded by bank officials to the IRS.

The IRS reportedly linked the transactions to Spitzer.

Given the nature of the transactions, allegedly designed to mask their flow to a company called QAT, authorities originally thought they might have a public corruption case.

The case was assigned to the Public Corruption Unit at the U.S. Attorney's office in Manhattan.

As the investigation went forward, authorities started electronic surveillance, including wiretaps, and reviewing Spitzer's e-mail and text messages.

It became clear this was a prostitution ring that was allegedly laundering money to cover its activity. According to one source familiar with the probe, "the governor became collateral damage in an investigation that he prompted."

Daniel Parker, attorney for Cecil "Kate" Suwal, who is charged by the government for organizing the Emperors Club, denied that his client knew the governor.

"My client entered a plea of not guilty at arraignment," Parker said. "What the governor chooses to announce is his business, and if true, it is a sad day for New York State."

"My client has never met the governor," he said. "I know what the allegations are. I think you best ask the governor if he had any association with the Emperors Club."

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