Client 9 - The Call Girl and the Governor

0:00:02 > 0:00:09This programme contains some strong language

0:00:11 > 0:00:13What I'm most proud of as Attorney General

0:00:13 > 0:00:15is that we were willing to walk into the buzzsaw

0:00:15 > 0:00:17of some very powerful interests,

0:00:17 > 0:00:19and never back down.

0:00:19 > 0:00:20Look, I had a simple rule.

0:00:20 > 0:00:24I never asked if a case was popular or unpopular.

0:00:24 > 0:00:26Never asked if it was big or small.

0:00:26 > 0:00:28Hard or easy.

0:00:28 > 0:00:30I simply asked if it was right or wrong.

0:00:38 > 0:00:40I will never forget THAT moment.

0:00:40 > 0:00:42I was dumbfounded.

0:00:45 > 0:00:48I can't say I was sorry.

0:00:48 > 0:00:50# Start spreading the news

0:00:50 > 0:00:53# I'm leaving today... #

0:00:53 > 0:00:56It was like, "You gotta be kidding!"

0:00:56 > 0:00:59# ..I want to be a part of it

0:00:59 > 0:01:03# New York, New York... #

0:01:03 > 0:01:06He was going to be our first Jewish President.

0:01:06 > 0:01:10# ..These vagabond shoes... #

0:01:10 > 0:01:13There was corporate corruption. Greed had seemed to hit its peak.

0:01:13 > 0:01:15And he was fighting all of that.

0:01:15 > 0:01:20# ..Right through the very heart of it

0:01:20 > 0:01:23# New York, New York

0:01:27 > 0:01:33# I want to wake up in a city that doesn't sleep

0:01:33 > 0:01:38# To find the cream of the crop at the top of the heap

0:01:42 > 0:01:45# These little town blues

0:01:45 > 0:01:50# I'm walking away

0:01:50 > 0:01:53# I'll make a brand-new start... #

0:01:53 > 0:01:56On the face of it, the fall of Governor Spitzer

0:01:56 > 0:01:58was just another sex scandal.

0:02:00 > 0:02:03Was it a private matter or a public reckoning?

0:02:07 > 0:02:08And what of the timing?

0:02:08 > 0:02:11A few months after his resignation, the reckless banks

0:02:11 > 0:02:15Spitzer had policed brought the economic system close to failure.

0:02:15 > 0:02:17# ..I'll make it anywhere

0:02:17 > 0:02:20# New York, New York... #

0:02:20 > 0:02:22Everyone agreed on one thing.

0:02:22 > 0:02:25No-one expected him to go down like he did.

0:02:31 > 0:02:37It is, to a certain extent, a very classic tale, perhaps,

0:02:37 > 0:02:40of an individual who, from the exterior,

0:02:40 > 0:02:43appears to have been captured by hubris.

0:02:43 > 0:02:47A sense of standing for virtues and, I think,

0:02:47 > 0:02:50working very hard to articulate

0:02:50 > 0:02:54and work towards establishing rules and boundaries

0:02:54 > 0:02:59but then, himself, slipping and failing.

0:02:59 > 0:03:02And this goes back to the days of Greek mythology.

0:03:02 > 0:03:03It's not a new story.

0:03:11 > 0:03:17In New York, everyone's some sort of an animal, you know?

0:03:17 > 0:03:21They're some sort of an animal.

0:03:21 > 0:03:24They're hungry...to make more money.

0:03:24 > 0:03:26Hungry to get more sex.

0:03:26 > 0:03:30To date a prettier girl, or a richer guy.

0:03:30 > 0:03:31Just hungry. Just greedy. Just animals.

0:03:36 > 0:03:40This Chinese philosopher said that human beings

0:03:40 > 0:03:43are a hybrid between

0:03:43 > 0:03:45animals and angels.

0:03:47 > 0:03:50That we're capable of animalistic behaviour.

0:03:52 > 0:03:54Consider sex and war.

0:03:54 > 0:03:58But we're capable of doing beautiful things too,

0:03:58 > 0:04:01like art, music, or making love.

0:04:01 > 0:04:05When I was contemplating that, I was like, "Wow, I kind of dig that."

0:04:05 > 0:04:07We're half-angel, half-animal.

0:04:17 > 0:04:19Good afternoon.

0:04:19 > 0:04:20Over the past nine years,

0:04:20 > 0:04:24eight years as Attorney General, and one as Governor,

0:04:24 > 0:04:27I've tried to uphold a vision of progressive politics

0:04:27 > 0:04:30that would rebuild New York and create opportunity for all.

0:04:30 > 0:04:35We sought to bring real change to New York, and that will continue.

0:04:35 > 0:04:39Today, I want to briefly address a private matter.

0:04:39 > 0:04:42I have acted in a way that violates my obligations to my family,

0:04:42 > 0:04:46and that violates my, or any, sense of right and wrong.

0:04:55 > 0:04:58Spitzer's wrong turn surprised everyone,

0:04:58 > 0:05:01because he had a reputation as Mr Right.

0:05:01 > 0:05:03As Attorney General of New York,

0:05:03 > 0:05:06he was known as the Sheriff of Wall Street,

0:05:06 > 0:05:12someone determined to take on powerful interests on behalf of those who couldn't afford to.

0:05:12 > 0:05:16This was a guy who understood that he had been

0:05:16 > 0:05:18a member of the lucky sperm club.

0:05:18 > 0:05:20He was really smart. He was wealthy.

0:05:20 > 0:05:23So he had gotten a lot of breaks in life.

0:05:23 > 0:05:27And he wanted to use that, you know,

0:05:27 > 0:05:29to better the world.

0:05:29 > 0:05:32Spitzer's father, Bernard, was a self-made real estate tycoon

0:05:32 > 0:05:38who sent his son to an elite prep school, Princeton, and Harvard Law School,

0:05:38 > 0:05:40where he met his wife to be,

0:05:40 > 0:05:41Silda Wall.

0:05:41 > 0:05:44His father had pushed him to succeed.

0:05:44 > 0:05:46We debated issues around the dining room table.

0:05:46 > 0:05:49So I guess it was more of a symposium

0:05:49 > 0:05:52than a touchy-feely environment.

0:05:52 > 0:05:56We were taught not to embrace a notion or principle of fact

0:05:56 > 0:05:59merely because somebody had asserted it.

0:05:59 > 0:06:01Challenge them. Push back.

0:06:01 > 0:06:03That was part of the conversation.

0:06:03 > 0:06:09For a real estate family, Monopoly takes on a special edge.

0:06:09 > 0:06:10Sure, it's a game.

0:06:10 > 0:06:13But it's also a way for a father to teach his son

0:06:13 > 0:06:15some lessons about money and power.

0:06:15 > 0:06:19Look, I don't want the impression to be that he was devoid of compassion,

0:06:19 > 0:06:21but it is true he foreclosed on me in a Monopoly game.

0:06:21 > 0:06:26Bernard Spitzer tricked his son into selling Boardwalk and Park Place

0:06:26 > 0:06:31for cheap and wiped him out when he landed on a built-up Boardwalk.

0:06:31 > 0:06:34The lesson - don't trust anyone.

0:06:34 > 0:06:37But I think, really, what he was trying to do was

0:06:37 > 0:06:40teach me how the market worked.

0:06:40 > 0:06:43Monopoly's a fun game, but I had overbuilt and overextended.

0:06:43 > 0:06:47And he said, "I'm sorry, that's it. There are consequences, and you've learned a lesson."

0:06:47 > 0:06:50- What was your response at the time? - Oh, I cried.

0:06:50 > 0:06:53I think I was about ten. I mean, I was a kid.

0:06:53 > 0:06:56It was no fun. I wanted to be bailed out.

0:06:56 > 0:07:00Bernie is a guy who judges people. That's a tough thing for a kid.

0:07:00 > 0:07:03I do remember him watching Eliot and me play tennis.

0:07:03 > 0:07:08And, after one particular serve and volley of mine which I won,

0:07:08 > 0:07:10he gave me the victory sign.

0:07:10 > 0:07:12He said, "Yeah, that's exactly what to do to him."

0:07:19 > 0:07:22Eliot's strategy is to stick with his core game.

0:07:22 > 0:07:24Hard shots, serve and volley.

0:07:26 > 0:07:30My reflexes are good.

0:07:30 > 0:07:32Love to get into net.

0:07:35 > 0:07:39As I say, the game I used to have keeps getting better.

0:07:39 > 0:07:43Eliot Spitzer's notion of public service was like his tennis game.

0:07:43 > 0:07:46Attack, attack, attack.

0:07:46 > 0:07:48Good morning and thank you for coming.

0:07:48 > 0:07:51As Attorney General, Spitzer saw an opportunity

0:07:51 > 0:07:52to do more than enforce the law.

0:07:52 > 0:07:55He wanted to use the law to change the way society worked.

0:07:55 > 0:07:59He sued coal-fired plants in Ohio for causing pollution in New York.

0:07:59 > 0:08:04He sued General Electric for dumping poisonous waste into the Hudson River.

0:08:04 > 0:08:06He uncovered fraud in the pharmaceutical industry,

0:08:06 > 0:08:09where pill-makers hid the damage done by their drugs.

0:08:09 > 0:08:14He fought for the minimum wage for delivery men, and forced upscale restaurants to hire more women.

0:08:14 > 0:08:17He would take them all on because no-one else would.

0:08:17 > 0:08:23There's a reason why Eliot Spitzer became famous as New York's Attorney General.

0:08:23 > 0:08:24The job had been a second-tier position.

0:08:24 > 0:08:28It had been focused on regulating crooked car dealers.

0:08:28 > 0:08:32And Eliot Spitzer focused on Wall Street, on the biggest guys around.

0:08:32 > 0:08:34And Spitzer's premise, which was right,

0:08:34 > 0:08:37was that Wall Street can't be left to regulate itself,

0:08:37 > 0:08:39or terrible things will happen.

0:08:39 > 0:08:43When I assumed office, which was January of 1999,

0:08:43 > 0:08:47we were in a period where Wall Street and investment bankers were,

0:08:47 > 0:08:50to use Tom Wolfe's great phrase, "masters of the universe".

0:08:50 > 0:08:52To protect the average citizen,

0:08:52 > 0:08:55Spitzer was willing to prosecute bankers and CEOs,

0:08:55 > 0:08:57like any other lawbreakers.

0:08:57 > 0:08:59In the course of this investigation,

0:08:59 > 0:09:01my office developed evidence

0:09:01 > 0:09:03indicating that analysts gave misleading advice that helped

0:09:03 > 0:09:05the brokerage's investment banking clients,

0:09:05 > 0:09:08but harmed individual investors.

0:09:08 > 0:09:10When we first got into this, everybody said,

0:09:10 > 0:09:14"Well, what's the State Attorney General's office in New York doing,

0:09:14 > 0:09:16"going after this problem? Shouldn't this be the SEC?"

0:09:16 > 0:09:19And my response was, "Yes, but they haven't."

0:09:19 > 0:09:20And if they haven't,

0:09:20 > 0:09:23and there are investors being ripped off, we WILL do it.

0:09:30 > 0:09:34Wall Street analysts advise buyers on what stocks look good or bad.

0:09:34 > 0:09:38With the rise of the internet, analysts became superstars because

0:09:38 > 0:09:42only they seemed to understand how to value internet companies.

0:09:42 > 0:09:45As stocks soared, so did the value of analysts who knew how to pick them.

0:09:45 > 0:09:49The more money they made, the more potential there was for abuse.

0:09:53 > 0:09:56Henry Blodget was a failed writer who stumbled into being

0:09:56 > 0:10:00a top research analyst when, as a young stock picker,

0:10:00 > 0:10:02he predicted the rise of Amazon.com.

0:10:02 > 0:10:07By 2001, he was working for Merrill Lynch, making 12 million a year.

0:10:09 > 0:10:13When one of Merrill's customers sued Blodget for phoney research,

0:10:13 > 0:10:15Spitzer's team investigated him,

0:10:15 > 0:10:17using an arcane law called the Martin Act

0:10:17 > 0:10:21to subpoena thousands of documents and emails in search of fraud.

0:10:21 > 0:10:25As Spitzer's team pored through Blodget's emails,

0:10:25 > 0:10:28they kept coming across the term POS.

0:10:28 > 0:10:30They thought POS was short for positive,

0:10:30 > 0:10:33for stocks Blodget wanted customers to buy.

0:10:33 > 0:10:36But then they stumbled upon Blodget's keyword chart.

0:10:40 > 0:10:44Blodget's emails were honest and brutally downbeat.

0:10:44 > 0:10:49Meanwhile, his official stock ratings were mostly upbeat,

0:10:49 > 0:10:53urging customers to buy, buy, buy.

0:10:53 > 0:10:57Mr and Mrs Smith, whose IRA - or 401k - is being invested,

0:10:57 > 0:11:01they are the sacrificial lambs, and being used to prop up the stock

0:11:01 > 0:11:05so that the Merrill Lynches of the world can go to companies and say,

0:11:05 > 0:11:08"See what we're doing for you? Bring us your investment banking business."

0:11:08 > 0:11:09It was fundamentally corrupt.

0:11:09 > 0:11:15It was insiders' Monopoly, guided by a basic fundamental principle.

0:11:15 > 0:11:17You don't go south of 14th Street

0:11:17 > 0:11:19except for one reason, to make money.

0:11:19 > 0:11:24The guys on the floor, all they cared about was making money.

0:11:24 > 0:11:26That's the American way.

0:11:26 > 0:11:33Jack Grubman was a highly respected telecommunications analyst for Salomon Smith Barney.

0:11:33 > 0:11:38He became famous for pumping up AT&T stock to please his boss, Sandy Weill.

0:11:38 > 0:11:43Then Weill helped Grubman get his twins into an exclusive preschool.

0:11:43 > 0:11:45Grubman's payday for research?

0:11:45 > 0:11:4720 million a year.

0:11:47 > 0:11:50Enough to buy a palace on the Upper East Side.

0:11:56 > 0:12:00Grubman's career ended when he relentlessly pumped up the stock

0:12:00 > 0:12:04of a company called WorldCom just before it went bankrupt.

0:12:04 > 0:12:08Do you regret, in hindsight, staying so bullish on the company for so long?

0:12:08 > 0:12:11Nothing... Look, why are you harassing me like this?

0:12:11 > 0:12:12I'm not harassing you.

0:12:12 > 0:12:15I'm just asking you questions about the company that you cover.

0:12:15 > 0:12:18This caught you completely by surprise, you say?

0:12:18 > 0:12:19Yes.

0:12:19 > 0:12:21Yes.

0:12:21 > 0:12:23- Thank you.- Yeah.

0:12:29 > 0:12:33There was always this, internally, we call it the come-to-Jesus moment,

0:12:33 > 0:12:37where we went to whoever it was we were prepared to sue

0:12:37 > 0:12:39and/or go after for doing something wrong,

0:12:39 > 0:12:43and we'd say to 'em, in no uncertain terms,

0:12:43 > 0:12:45"Tell us why, given this fact pattern,

0:12:45 > 0:12:47"we would be wrong to sue your ass."

0:12:47 > 0:12:51Early on in the investigation, the Merrill Lynch lawyers came into my office.

0:12:51 > 0:12:54They looked at me and they said, "You're right.

0:12:54 > 0:12:57"But we're not as bad as our competitors."

0:12:57 > 0:12:59I was a prosecutor for a lot of years.

0:12:59 > 0:13:02I never heard a defendant stand up in court and say,

0:13:02 > 0:13:07"Yeah, I robbed three people, but somebody over their robbed five so, therefore, I'm not bad."

0:13:07 > 0:13:09Merrill Lynch wanted to settle the case and pay some money and said,

0:13:09 > 0:13:13"We will pay a big sum of money if you promise to keep the information secret."

0:13:13 > 0:13:16And I said, "No.

0:13:16 > 0:13:19"Because my job as Attorney General is to change the system

0:13:19 > 0:13:22"so that it's fair and will be honest.

0:13:22 > 0:13:24"And if we seal the evidence and you pay a cheque,

0:13:24 > 0:13:27"and we don't change the system, I'm basically being bought off."

0:13:27 > 0:13:30My office has reached an agreement that will help ensure

0:13:30 > 0:13:34the integrity of investment advice on which investors often depend.

0:13:34 > 0:13:36Blodget and Grubman paid million-dollar fines

0:13:36 > 0:13:39and were banned from the securities industry for life.

0:13:39 > 0:13:42But their firms bought their permanent silence

0:13:42 > 0:13:45with handsome severance packages.

0:13:45 > 0:13:50In exchange for Grubman's silence on the details of his firm's behaviour,

0:13:50 > 0:13:53Solomon Smith Barney paid Grubman 30 million.

0:13:56 > 0:13:59The nation's best and brightest were lured to Wall Street

0:13:59 > 0:14:01in search of fast fortunes.

0:14:01 > 0:14:03The money they made flowed everywhere.

0:14:03 > 0:14:05Penthouses, yachts, golf clubs.

0:14:05 > 0:14:08And to the oldest sector of the global economy,

0:14:08 > 0:14:10ready for a new cash infusion.

0:14:10 > 0:14:14I have rich lovers.

0:14:14 > 0:14:17# Love for sale... #

0:14:17 > 0:14:19I don't go out with poor men.

0:14:19 > 0:14:21I've got no reason to do so.

0:14:21 > 0:14:26# ..Appetising young love for sale... #

0:14:26 > 0:14:30I don't call prostitution and escorting selling your body.

0:14:30 > 0:14:33# ..Love for sale... #

0:14:33 > 0:14:35You don't sell, you rent.

0:14:35 > 0:14:39I love my bank account full.

0:14:39 > 0:14:41It's better than empty.

0:14:45 > 0:14:49There's a street in Soho where a lot of artists set up.

0:14:49 > 0:14:52I was selling my paintings one day

0:14:52 > 0:14:54and this charismatic fellow comes along,

0:14:54 > 0:14:57and he's got a beautiful girl with him.

0:14:57 > 0:14:58This girlfriend, Natalia, said,

0:14:58 > 0:15:02"This is the number-one escort, New York city.

0:15:02 > 0:15:04"I run New York's number-one escort agency."

0:15:04 > 0:15:07I've never seen you naked. You think your body's good enough?

0:15:07 > 0:15:09"I want to buy the biggest, most expensive painting you've done."

0:15:09 > 0:15:11He gives me his business card.

0:15:11 > 0:15:14I still have an old souvenir.

0:15:18 > 0:15:22"New York Confidential. Rocket fuel for winners."

0:15:22 > 0:15:24That's all it says.

0:15:24 > 0:15:27In 2004, New York Confidential was at its height,

0:15:27 > 0:15:31making millions by offering clients the Girlfriend Experience.

0:15:31 > 0:15:35A few hours with naughty playmates who look like college cheerleaders.

0:15:35 > 0:15:39- I've had 1,500 in 100 bills in my purse.- Oh, God.

0:15:39 > 0:15:42- I pulled it out.- Only 15? THEY LAUGH

0:15:42 > 0:15:45We started hanging out, even after I did the painting.

0:15:45 > 0:15:48One day, we're in the back of a town car and he says,

0:15:48 > 0:15:50"Hey, grab the phone.

0:15:50 > 0:15:53"Just talk to the guy and try to help him out.

0:15:53 > 0:15:56"He's probably looking for a girl to spend the night with."

0:15:56 > 0:16:00I'm on the cell phone and, you know, my adrenaline is going

0:16:00 > 0:16:05and I'm, like, "OK, we have a brunette, a blonde.

0:16:05 > 0:16:08"Do you like ethnic girls?"

0:16:08 > 0:16:10I do a deal for, I don't know, three or four thousand.

0:16:10 > 0:16:15He says, "Great. You just made 400 bucks from a five-minute phone call. I'll give you 10%.

0:16:15 > 0:16:18"Why don't you just come to work for me for a little while, you know?"

0:16:18 > 0:16:21That Craigslist ad pulled well, huh?

0:16:21 > 0:16:24That's where it all began. When I started working for Jason.

0:16:24 > 0:16:27How do you know she's a no?

0:16:27 > 0:16:30We don't get that many calls for Asians. One hot Asian is plenty.

0:16:30 > 0:16:32We need more blondes, hot blondes.

0:16:32 > 0:16:35They might look good in person, but they've got a shitty photographer.

0:16:35 > 0:16:38Hot blondes. She's a definite yes.

0:16:42 > 0:16:48When a businessman spends, say, 2,000 an hour,

0:16:48 > 0:16:52he wants to read the reviews just like if he were to buy a car.

0:16:52 > 0:16:56You want to read the reviews. How much mileage does it get?

0:16:56 > 0:16:59Does it have air conditioning? Four-wheel drive?

0:16:59 > 0:17:05What's the difference between paying 1,000 an hour for this young lady

0:17:05 > 0:17:08when I can open up the Village Voice or go on Craigslist

0:17:08 > 0:17:12and I can pay 200 for another young lady?

0:17:12 > 0:17:14And I'd say, "Well, sir, sure.

0:17:14 > 0:17:18"You can have a cheeseburger, or you can have lobster.

0:17:20 > 0:17:22"You're going to have such a good time

0:17:22 > 0:17:25"with one of New York Confidential's girls that

0:17:25 > 0:17:28"you're going to go to work Monday morning with a smile on your face,

0:17:28 > 0:17:31"you're going to make more money for you and your family,

0:17:31 > 0:17:34"and then you're going to call me up next week and you're going to say,

0:17:34 > 0:17:36"'Who can you send me out today?'"

0:17:38 > 0:17:41You can make the assumption that they're not being sexually satisfied in their marriage,

0:17:41 > 0:17:44or there's baggage, or whatever.

0:17:44 > 0:17:47And then what's their option? Do they get divorced?

0:17:47 > 0:17:49Do they split up their family?

0:17:49 > 0:17:52Or do they seek, you know, do they go see an escort?

0:17:52 > 0:17:54One young lady was a schoolteacher.

0:17:54 > 0:17:59Another girl was an athlete, trying to make it to the Olympics.

0:17:59 > 0:18:02Actresses, singers, models.

0:18:02 > 0:18:05Jason would give his business card to every girl that he met.

0:18:05 > 0:18:08Half of them would call and then a quarter of them would start working.

0:18:08 > 0:18:13Some girls would offer me cash, tips.

0:18:13 > 0:18:16Some girls offered me sex.

0:18:16 > 0:18:20I don't think I ever got a tip or sex with Ashley.

0:18:20 > 0:18:23Ashley was Ashley Youmans, later Ashley Dupre,

0:18:23 > 0:18:27who would become famous for having sex with Eliot Spitzer.

0:18:27 > 0:18:31As an escort, she got her start at New York Confidential,

0:18:31 > 0:18:34where her working name was Victoria.

0:18:34 > 0:18:37It was through one of those straight pitches that Jason found Ashley.

0:18:37 > 0:18:41Jason recruited her from the Gansevoort Hotel.

0:18:41 > 0:18:44At the Gansevoort, Ashley was a bottle girl,

0:18:44 > 0:18:46trying to break in to the music business.

0:18:46 > 0:18:48She was just light. She was just happiness.

0:18:48 > 0:18:50She was a great, bubbly 19-year-old girl.

0:18:56 > 0:19:00She was a good American, New Jersey, Italian girl.

0:19:00 > 0:19:02Guys loved her.

0:19:02 > 0:19:05She had great pheromones or something, you know.

0:19:05 > 0:19:07Within three or four weeks,

0:19:07 > 0:19:11her rate was going up to 2,000 an hour, with a two-hour minimum.

0:19:11 > 0:19:13Her reviews were awesome as well.

0:19:13 > 0:19:19I think she got something like 12 consecutive 10/10 reviews.

0:19:19 > 0:19:21After we did our first appointment together, I told Jason,

0:19:21 > 0:19:23"You got to book this girl."

0:19:23 > 0:19:27First of all, she's great. But she also has a perfect coochie.

0:19:27 > 0:19:29Ashley's reign ended when New York Confidential

0:19:29 > 0:19:31was raided by local police.

0:19:31 > 0:19:34No customers were arrested, but Hulbert was convicted of

0:19:34 > 0:19:37promoting prostitution and was sent to jail for eight months.

0:19:37 > 0:19:39Ashley would move on to work

0:19:39 > 0:19:41for another escort service.

0:19:43 > 0:19:47For every New Yorker who's been ignored, left out,

0:19:47 > 0:19:50who's been told, "You can't fight City Hall,"

0:19:50 > 0:19:52so many times, they've come to believe it.

0:19:52 > 0:19:55For every New Yorker without a voice, listen.

0:19:55 > 0:19:57There's one strong enough for all of us.

0:20:05 > 0:20:10For most of our history, we have turned a blind eye to

0:20:10 > 0:20:14the violations of duty on the part of white-collar criminals.

0:20:14 > 0:20:16We can understand it.

0:20:16 > 0:20:19There's something viscerally terrifying about street crime.

0:20:19 > 0:20:22And, until you're safe in your home,

0:20:22 > 0:20:26you worry a bit less about what is often a bit more amorphous,

0:20:26 > 0:20:30which is the nature of white-collar crime, which is more subtle theft.

0:20:30 > 0:20:33Spitzer broke the mould of how you prosecute a white-collar case.

0:20:33 > 0:20:36He went after it fast and hard and he got things done

0:20:36 > 0:20:40in a period of weeks or months that would take federal regulators years.

0:20:40 > 0:20:43He wanted to change the system, so he'd get the goods on a company,

0:20:43 > 0:20:45or on people, and use it as leverage to institute reform.

0:20:45 > 0:20:48To force the industry to change the way it did business.

0:20:48 > 0:20:49A lot of people thought that was outrageous.

0:20:49 > 0:20:54While Spitzer stirred popular rage at Wall Street, there were a few people

0:20:54 > 0:20:57who were delighted to see the bankers take home big paydays.

0:20:57 > 0:21:01As revealed in the actual cell phone of one of the bookers

0:21:01 > 0:21:04of the escort service called the Emperors Club.

0:21:14 > 0:21:18The lawyer/banker thing is true. There are quite a lot of them.

0:21:18 > 0:21:20But there are lots of stereotypes, you know?

0:21:20 > 0:21:24That it's this crazy, drug-fuelled sort of party scene.

0:21:24 > 0:21:27But, generally, people are respectful.

0:21:27 > 0:21:30They just want to have a nice time with someone.

0:21:30 > 0:21:34Many of my clients are nicer to me than many of the dates I've been on.

0:21:34 > 0:21:40In fact, I've stopped dating in the real world.

0:21:40 > 0:21:42Partly because it would be complicated,

0:21:42 > 0:21:46and partly because my standard has lifted.

0:21:46 > 0:21:48Honestly. You know?

0:21:48 > 0:21:51The pictures of Ashley didn't surface right way.

0:21:51 > 0:21:52The Eliot Spitzer story broke

0:21:52 > 0:21:56and then all these media outlets were calling me to do interviews.

0:21:56 > 0:21:59And so I did a few interviews without even knowing that

0:21:59 > 0:22:04Ashley - my Ashley - was Victoria, was Kristen, was who she was.

0:22:04 > 0:22:08Tonight, Eliot Spitzer resigns as Governor of New York.

0:22:08 > 0:22:09Where will he find comfort

0:22:09 > 0:22:11in this difficult time?

0:22:11 > 0:22:13I was shocked when it all happened.

0:22:13 > 0:22:18But then when I saw Ashley's picture flashed on the news,

0:22:18 > 0:22:20I was, like, "Wait a second!"

0:22:20 > 0:22:23I was, like, "Oh, my gosh!" I couldn't believe it.

0:22:23 > 0:22:25She fit the bill.

0:22:28 > 0:22:31The New York Times website identifies Governor Spitzer's

0:22:31 > 0:22:34mystery call girl as Ashley Alexandra Dupre.

0:22:34 > 0:22:37All over papers and television, she was called "Spitzer's girl".

0:22:37 > 0:22:39Known as Kristen at the Emperors Club,

0:22:39 > 0:22:44Ashley Dupre was determined to take advantage of her sudden opportunity.

0:22:44 > 0:22:47Clearly, Ashley was trying to make

0:22:47 > 0:22:49a name for herself.

0:22:49 > 0:22:52After the scandal broke, Ashley's MySpace page,

0:22:52 > 0:22:55with one of her songs available for streaming,

0:22:55 > 0:22:56got over seven million hits.

0:22:56 > 0:23:00To help package her career, she brought on board two lawyers,

0:23:00 > 0:23:02a publicist and a management team.

0:23:05 > 0:23:08Ashley's manager arranged for an interview with Diane Sawyer.

0:23:08 > 0:23:10Everyone played their part.

0:23:10 > 0:23:12Ashley dressed up as the good girl gone wrong

0:23:12 > 0:23:16and Diane Sawyer played the role of the scalding mom.

0:23:16 > 0:23:21You say the work, but you haven't said the words.

0:23:21 > 0:23:24- The work?- Prostitution.

0:23:24 > 0:23:26Escort.

0:23:26 > 0:23:28Escort. What's the difference?

0:23:28 > 0:23:32- Escort.- What's the difference?

0:23:32 > 0:23:36She catered to the stereotypes of hookers which are, you know,

0:23:36 > 0:23:39"Poor me, I had a troubled childhood. I made a mistake."

0:23:39 > 0:23:40Which is such a load of crap.

0:23:40 > 0:23:43It's... I can't change the past.

0:23:43 > 0:23:48I can only try to take what I've learned and apply that to my future.

0:23:50 > 0:23:52We're being paid ridiculous amounts of money.

0:23:52 > 0:23:56None of these women are forced to do this. And they're not stupid.

0:23:56 > 0:24:00Many of the professional prostitutes that I know are very smart women,

0:24:00 > 0:24:02who weren't abused, you know.

0:24:02 > 0:24:03Don't have a mental disorder.

0:24:03 > 0:24:07They just happen to believe in this kind of work.

0:24:07 > 0:24:09So did their customers.

0:24:09 > 0:24:13The cell phone of the booker from the Emperors Club

0:24:13 > 0:24:16offered a glimpse of the club's well-heeled client list.

0:24:16 > 0:24:21An Oscar winner, CEOs and high-powered investment bankers.

0:24:21 > 0:24:25The club treated them like emperors, and why not?

0:24:25 > 0:24:27They made more money than kings.

0:24:27 > 0:24:30They enjoyed having their way with women and the world.

0:24:30 > 0:24:33So it came as no surprise that they resented it

0:24:33 > 0:24:36when the New York Attorney General started to cramp their style.

0:24:36 > 0:24:41The Economist magazine calls him Wall Street's scourger-in-chief.

0:24:41 > 0:24:45He's gone from complete anonymity to what Fortune Magazine calls,

0:24:45 > 0:24:47"the most feared man on Wall Street."

0:24:47 > 0:24:51Spitzer has deputised himself as the Sheriff of Wall Street

0:24:51 > 0:24:55and is leading the posse for retribution, restitution and reform.

0:24:55 > 0:24:59Spitzer appealed to Democrats and Republicans.

0:24:59 > 0:25:02He was a law and order liberal who wasn't afraid to punch back.

0:25:02 > 0:25:05When you walk into a building on Wall Street,

0:25:05 > 0:25:11is it like turning the light on in the kitchen and the roaches just scatter everywhere?

0:25:11 > 0:25:12Like a beam of light to the corrupt.

0:25:12 > 0:25:14There was a day when I had to walk into a hedge fund...

0:25:14 > 0:25:18What I was intrigued by was the number of people who were terrified of him.

0:25:18 > 0:25:22They literally were terrified at this guy coming after them.

0:25:27 > 0:25:30The issue of CEO comp was something

0:25:30 > 0:25:32I had been trying to get people to take a look at.

0:25:32 > 0:25:35It was off the rails.

0:25:35 > 0:25:39# I take what I want

0:25:39 > 0:25:42# I'm a bad go-getter, yeah

0:25:42 > 0:25:45# Huh! Yes, I am

0:25:45 > 0:25:49# I'll never lose

0:25:49 > 0:25:52# And I'll never quit, oh, yeah... #

0:25:52 > 0:25:56The ratio of CEO comp to the average worker's comp had gone from about

0:25:56 > 0:25:5740 to one to about 550 to one.

0:25:57 > 0:26:01CEOs began to just take everything they could and, ultimately,

0:26:01 > 0:26:04that was going to destroy our economy.

0:26:04 > 0:26:06Because, instead of running the companies to create

0:26:06 > 0:26:08long-term wealth and long-term investment,

0:26:08 > 0:26:12all the games we've seen, everything from backdating of stock options

0:26:12 > 0:26:15to maximising short-term profits without sufficient investment for the long term,

0:26:15 > 0:26:20these are things that are cancers inside the economy.

0:26:23 > 0:26:27One of the flashiest executives was head of the New York Stock Exchange,

0:26:27 > 0:26:31Dick Grasso, who boasted owning ten cars and three homes.

0:26:31 > 0:26:35He travelled on private jets, often flanked by armed bodyguards.

0:26:35 > 0:26:39His job was to regulate and market the New York Stock Exchange.

0:26:39 > 0:26:45Nicknamed Punky, Grasso was a scrappy college dropout who started on the floor and worked his way up.

0:26:45 > 0:26:48There's a job opening at the New York Stock Exchange.

0:26:48 > 0:26:52Chairman Dick Grasso resigned yesterday over the fury raised by his massive pay package.

0:26:52 > 0:26:57Not only was Grasso paid an average annual salary of 20 million,

0:26:57 > 0:27:01his retirement package totalled nearly 140 million.

0:27:01 > 0:27:03After Grasso stepped down,

0:27:03 > 0:27:08the new head of the exchange brought the matter to the Attorney General.

0:27:08 > 0:27:12There's a statute in New York that says the value of the pay cheque

0:27:12 > 0:27:14that the head of a not-for-profit receives

0:27:14 > 0:27:18must be commensurate with the value of the services provided.

0:27:18 > 0:27:21I like Dick. He's a decent guy.

0:27:21 > 0:27:24He didn't provide services worth 139 million.

0:27:24 > 0:27:28Perhaps more perversely, the compensation had been determined by

0:27:28 > 0:27:32the very people he was supposed to be regulating.

0:27:32 > 0:27:38I had the most respected group of directors from the corporate and financial world.

0:27:38 > 0:27:41They exercised their business judgement.

0:27:41 > 0:27:46They paid me what they believed to be fair and reasonable, which I agree with.

0:27:46 > 0:27:50Spitzer decided not to go after the blue-chip international board.

0:27:50 > 0:27:55Instead, he sued Grasso and the head of the board's compensation committee, Ken Langone.

0:27:55 > 0:28:00Langone would prove to be a formidable foe.

0:28:00 > 0:28:01I've been rich and I've been poor.

0:28:01 > 0:28:05Rich is better, I can tell you right now.

0:28:05 > 0:28:10The son of a Long Island plumber, Ken Langone had co-founded Home Depot

0:28:10 > 0:28:13and amassed a fortune of well over a billion dollars.

0:28:13 > 0:28:18A dedicated philanthropist, Langone was not shy about paying people well.

0:28:18 > 0:28:22At the time we awarded Dick these pay packages,

0:28:22 > 0:28:27I truly believed that Dick earned every single penny, and more.

0:28:27 > 0:28:31Spitzer demanded that Grasso return 100 million.

0:28:31 > 0:28:34At the time, Langone told Fortune Magazine,

0:28:34 > 0:28:38"If Grasso gives back a fucking nickel, I'll never talk to him again."

0:28:38 > 0:28:41He, as anybody in that position would, took umbrage at him.

0:28:41 > 0:28:44And he developed a rather strong animus towards me.

0:28:48 > 0:28:53The day that I sat in this room and he went on television with

0:28:53 > 0:28:59that false press conference he had, announcing that he was going after

0:28:59 > 0:29:04Dick Grasso and me, and all kinds of bad things about me...

0:29:04 > 0:29:07Eliot's theatrics.

0:29:07 > 0:29:10You can't pay the head of a not-for-profit that much money,

0:29:10 > 0:29:13close to 200 million.

0:29:13 > 0:29:14It's simply too much.

0:29:14 > 0:29:16It's not reasonable. It's not right.

0:29:16 > 0:29:18It violates the law.

0:29:18 > 0:29:19It was headlines.

0:29:19 > 0:29:21It was glorious headlines.

0:29:21 > 0:29:25All these captains of industry. Hey, this is big game.

0:29:25 > 0:29:26This is going after elephants.

0:29:26 > 0:29:31He became a very vociferous critic of mine, and that's all fair game.

0:29:31 > 0:29:34In my view, we were right and he was wrong.

0:29:34 > 0:29:37But, again, it was something he felt deeply about.

0:29:38 > 0:29:42In 2004, at the Democratic National Convention, Spitzer took up the issue

0:29:42 > 0:29:46with Jack Welch, the former CEO of General Electric.

0:29:46 > 0:29:49Jack and I are very good friends.

0:29:49 > 0:29:52Spitzer came up to him with froth

0:29:52 > 0:29:58coming out of the sides of his mouth, spitting at me, and pointing at Jack,

0:29:58 > 0:29:59"You tell your buddy

0:29:59 > 0:30:03"I'm going to put a spike through his heart!"

0:30:03 > 0:30:07This is not something the Attorney General of New York State says.

0:30:07 > 0:30:09So when Jack told me, I said, "Jack, do me a favour."

0:30:09 > 0:30:10I said, "If you see him,

0:30:10 > 0:30:14"tell him one thing - make sure it's steel, because wood'll break."

0:30:16 > 0:30:19The case dragged on for years.

0:30:19 > 0:30:23In 2008, the New York State Court of Appeals dismissed the case for a bizarre reason.

0:30:23 > 0:30:29Since the suit had been brought, the New York Stock Exchange had abandoned its not-for-profit status.

0:30:29 > 0:30:35Dick Grasso kept all his money, but Eliot Spitzer had engaged an enemy with virtually unlimited resources.

0:30:35 > 0:30:40One who was watching and waiting for any missed step.

0:30:40 > 0:30:44I'd like to think I'm not a vindictive person.

0:30:47 > 0:30:51And a basic tenet of my faith is forgiveness.

0:30:51 > 0:30:55The most harm that Eliot Spitzer's done to me is...

0:30:55 > 0:30:57I am defying my faith.

0:30:57 > 0:30:59I can't forgive him.

0:30:59 > 0:31:01And I should. But I can't.

0:31:13 > 0:31:16In Ken Langone, Spitzer had created a mighty enemy.

0:31:16 > 0:31:20And then he added another one, when he took on Hank Greenberg,

0:31:20 > 0:31:23the head of the world's largest insurance company, AIG.

0:31:28 > 0:31:33At the age of 79, Maurice Hank Greenberg was the most powerful businessman on the planet.

0:31:33 > 0:31:38Under his command, AIG had grown to be worth 157 billion,

0:31:38 > 0:31:41with 92,000 employees.

0:31:41 > 0:31:44Admired for his spectacular results,

0:31:44 > 0:31:47Greenberg ruled his empire with an iron fist.

0:31:47 > 0:31:50I think he was Louis XIV to everybody else's, you know,

0:31:50 > 0:31:52being a mere baron.

0:31:52 > 0:31:58I think Hank Greenberg epitomised the power of corporate CEOs and,

0:31:58 > 0:32:02in my view, he was the most powerful person in corporate America.

0:32:02 > 0:32:07Greenberg's measure of his own worth was the stock price at AIG.

0:32:07 > 0:32:10The normal cycle of business is that sometimes your profits go up,

0:32:10 > 0:32:12and sometimes your profits go down.

0:32:12 > 0:32:15But Wall Street didn't like companies to perform that way.

0:32:15 > 0:32:17They wanted to see steadily rising profits.

0:32:17 > 0:32:19If you delivered steadily rising profits,

0:32:19 > 0:32:21they'd give you a higher stock price.

0:32:21 > 0:32:24So Hank Greenberg came up with a new type of insurance that would

0:32:24 > 0:32:27create the illusion of steadily rising earnings.

0:32:27 > 0:32:31Greenberg's AIG was fined over 100 million by federal authorities

0:32:31 > 0:32:35for helping other companies cook their books.

0:32:35 > 0:32:41In 2005, it appeared that AIG might be using similar tricks to pump up its own stock.

0:32:41 > 0:32:44The more we dug into AIG,

0:32:44 > 0:32:50the more problematic the company itself appeared to me to be.

0:32:50 > 0:32:57And the disconcerting aspect of it was that it did appear to come from the very top.

0:32:59 > 0:33:05When did you first hear about Spitzer's investigation of AIG?

0:33:05 > 0:33:06When I got a subpoena.

0:33:06 > 0:33:10One deal generated by Greenberg caught the eye of Spitzer

0:33:10 > 0:33:11and federal investigators.

0:33:11 > 0:33:15It was a suspicious contract between AIG and Gen Re,

0:33:15 > 0:33:19a company owned by billionaire Warren Buffett.

0:33:19 > 0:33:22One of the most startling moments in this case was when

0:33:22 > 0:33:25tapes emerged that were dispositive overwhelming proof

0:33:25 > 0:33:28of exactly what these transactions had been.

0:33:28 > 0:33:32As this was unfolding, Dick Beattie called me

0:33:32 > 0:33:35one Saturday morning at home and said, "Let's talk about this."

0:33:35 > 0:33:39The board wanted me to find out what I could

0:33:39 > 0:33:43about the Gen Re investigation.

0:33:43 > 0:33:45Eliot was jogging on a Saturday morning or something.

0:33:45 > 0:33:47I met him in the park.

0:33:47 > 0:33:51The only thing of significance, he told me, as I recall,

0:33:51 > 0:33:57was that they had Hank's name on tapes.

0:34:16 > 0:34:20To boost his stock price, Hank Greenberg wanted to make it look like

0:34:20 > 0:34:23AIG had 500 million more than it did.

0:34:23 > 0:34:28We got a call to see if we could get a loss portfolio from Ron Ferguson.

0:34:28 > 0:34:30What happened afterwards, I don't know.

0:34:30 > 0:34:34I didn't... I wasn't involved in the details of the transaction.

0:35:05 > 0:35:09A handwritten deal memo laid out the terms.

0:35:09 > 0:35:14Gen Re would pretend to pay AIG 500 million

0:35:14 > 0:35:17in two instalments for a phoney insurance policy.

0:35:17 > 0:35:19There was no risk of paying a claim.

0:35:22 > 0:35:26For doing the phoney deal, AIG would pay Gen Re a 5 million fee.

0:35:26 > 0:35:28HOULDSWORTH LAUGHS

0:35:28 > 0:35:32- HOULDSWORTH:- 'No risk. No risk for five million bucks.'

0:35:32 > 0:35:35Hank Greenberg's initials, MRG, were all over the document.

0:35:35 > 0:35:38- MONRAD:- 'The two people at AIG who are involved

0:35:38 > 0:35:40'are Hank Greenberg and Chris Milton.'

0:35:40 > 0:35:42AIG was a big company.

0:35:42 > 0:35:46I didn't just stay focused on the Gen Re transaction.

0:36:00 > 0:36:01HOULDSWORTH CHUCKLES

0:36:01 > 0:36:04'Yeah, well, that tells you something, doesn't it?'

0:36:04 > 0:36:09What was an unfair advantage to Greenberg was seen as cooking the books to

0:36:09 > 0:36:13AIG's accountants, PricewaterhouseCoopers.

0:36:13 > 0:36:16The firm refused to accept AIG's financial statements

0:36:16 > 0:36:18as long as Greenberg was the CEO.

0:36:18 > 0:36:23Hank wasn't pushed out by Eliot.

0:36:23 > 0:36:26What happened was, the investigation that followed,

0:36:26 > 0:36:29and the accountants, at the end of the day, said,

0:36:29 > 0:36:32"We're not taking that certification any more.

0:36:32 > 0:36:35"So you're saying you're the board of directors and, my God, what does that mean?"

0:36:35 > 0:36:37That's what drove the board

0:36:37 > 0:36:39deciding that Hank had to go,

0:36:39 > 0:36:41and one other issue.

0:36:41 > 0:36:44Spitzer demanded that Hank Greenberg testify under oath.

0:36:44 > 0:36:48However, Greenberg's lawyers advised him to plead the Fifth, despite

0:36:48 > 0:36:54AIG's policy to fire employees who didn't cooperate with regulators.

0:36:54 > 0:36:56That troubled a lot of people on the board.

0:36:56 > 0:36:59They wanted him to say, "No, absolutely not.

0:36:59 > 0:37:02"I'm not going to take the Fifth. I'm going to testify."

0:37:02 > 0:37:08I think Frank Zarb and I called Hank and told him that

0:37:08 > 0:37:12the board had made the decision that he had to step down.

0:37:12 > 0:37:14These are very serious offences.

0:37:14 > 0:37:16Over 1 billion of accounting frauds

0:37:16 > 0:37:18that AIG has already acknowledged.

0:37:18 > 0:37:21That company was a black box, run with an iron fist,

0:37:21 > 0:37:24by a CEO who did not tell the public the truth. That is the problem.

0:37:24 > 0:37:27Does that mean you're moving toward an indictment?

0:37:27 > 0:37:29No, I didn't say that. It depends what we can prove

0:37:29 > 0:37:31that Mr Greenberg knew at the time.

0:37:31 > 0:37:33We have powerful evidence. We will proceed with it.

0:37:33 > 0:37:36It's too bad that the Attorney General

0:37:36 > 0:37:38doesn't come out from behind his office

0:37:38 > 0:37:41where he's protected against libel.

0:37:41 > 0:37:45I wish he'd come out and say these things as a citizen.

0:37:45 > 0:37:51Spitzer attacked Greenberg, and I saw him on television one night

0:37:51 > 0:37:55saying that Hank Greenberg was a crook.

0:37:55 > 0:37:59John Whitehead had been a war hero, a Deputy Secretary of State

0:37:59 > 0:38:02and the chairman of Goldman Sachs.

0:38:02 > 0:38:05And his office continued to leak information about why he was

0:38:05 > 0:38:10a crook, without ever any charges being brought against Hank.

0:38:10 > 0:38:13So I said, "This is something I have to do something about."

0:38:13 > 0:38:16So that's what caused me to write that first article.

0:38:16 > 0:38:20I had heard of an incident involving former Goldman Sachs chairman John Whitehead.

0:38:20 > 0:38:24Mr Whitehead had come out publicly supporting Mr Greenberg.

0:38:24 > 0:38:26After that op-ed was published,

0:38:26 > 0:38:30he received a threatening phone call from Eliot Spitzer.

0:38:30 > 0:38:34He asked me a couple of questions about my article.

0:38:34 > 0:38:36And then he came right to the point.

0:38:36 > 0:38:39He said, "Mr Whitehead, you and I are now at war."

0:38:39 > 0:38:42Look, he had written an op.

0:38:42 > 0:38:44I don't know if I said those words or not.

0:38:44 > 0:38:49If that's the worst I said, you know... OK, that's... People are at war with me all the time.

0:38:49 > 0:38:51"You have fired the first bullet."

0:38:51 > 0:38:53"You have fired the first bullet.

0:38:53 > 0:38:56"But, believe me, by the end of this war,

0:38:56 > 0:38:59"I will fire the last one and you will be dead."

0:38:59 > 0:39:02Well, I don't think I said that. I mean, I wouldn't say...

0:39:02 > 0:39:03Look, I hope I didn't say that.

0:39:03 > 0:39:05He was screaming into the phone.

0:39:05 > 0:39:08He and I had a heated conversation. I will leave it at that.

0:39:08 > 0:39:10It was a private conversation.

0:39:10 > 0:39:14As I've said, I never denied that I have heated conversations in private.

0:39:14 > 0:39:15It's a, you know...

0:39:15 > 0:39:17It was me. It is me. So be it.

0:39:17 > 0:39:20And I think, sometimes, it's how you get things done.

0:39:20 > 0:39:23He said, "I will destroy you."

0:39:23 > 0:39:26And those are strong words.

0:39:26 > 0:39:30I had never heard words like that before from anybody.

0:39:30 > 0:39:32I couldn't quite believe it.

0:39:32 > 0:39:36Spitzer's outbursts became legendary to his staff.

0:39:36 > 0:39:40When he exploded, his staff would remark that Spitzer's evil twin,

0:39:40 > 0:39:43Erwin, had dropped in for an unexpected visit.

0:39:43 > 0:39:48In fact, a very prominent lawyer of a very fine company

0:39:48 > 0:39:51had a meeting with him.

0:39:51 > 0:39:53And this man said to me,

0:39:53 > 0:39:59"When I came out of his office, I swore I saw the words E.V.I.L across his forehead."

0:39:59 > 0:40:02I have no doubt if Hank Greenberg was still running AIG,

0:40:02 > 0:40:04AIG would not be in the fix it's in today.

0:40:04 > 0:40:08Today, the federal government announced it has once again

0:40:08 > 0:40:11reworked the bailout of insurance giant AIG.

0:40:11 > 0:40:13Now the bailout needs a bailout.

0:40:13 > 0:40:17Two months after AIG was given that first emergency government loan,

0:40:17 > 0:40:19it's getting another lifeline.

0:40:19 > 0:40:23In 2008, AIG was at the centre of a global economic meltdown.

0:40:23 > 0:40:26Before and after Greenberg's fall, AIG had been selling

0:40:26 > 0:40:31billions of dollars of insurance to the world's biggest banks

0:40:31 > 0:40:34to hide their risky gambles on home mortgages.

0:40:34 > 0:40:39When housing prices collapsed, AIG couldn't pay the claims.

0:40:39 > 0:40:43The US taxpayers paid 183 billion in an effort to save

0:40:43 > 0:40:46the global economy from collapse.

0:40:46 > 0:40:50According to Greenberg, the blame for AIG's fall

0:40:50 > 0:40:56and the global meltdown rested with one regulator, Eliot Spitzer.

0:40:56 > 0:40:59Spitzer wanted me out.

0:40:59 > 0:41:03When politicians involve themselves in who is going to run a company

0:41:03 > 0:41:08and who is not, we're on dangerous ground in this country.

0:41:08 > 0:41:11It is the big lie writ large.

0:41:11 > 0:41:13The books were being cooked at his company.

0:41:13 > 0:41:18Hank Greenberg was removed as CEO by his own board

0:41:18 > 0:41:20when they saw the underlying facts of what was then

0:41:20 > 0:41:23one of the largest financial frauds in history.

0:41:23 > 0:41:25I didn't do anything improper.

0:41:25 > 0:41:28Neither did any of the senior team do anything improper.

0:41:28 > 0:41:32And you say to people, if Hank Greenberg had still been there,

0:41:32 > 0:41:34this would never have happened?

0:41:34 > 0:41:36It would not have happened.

0:41:36 > 0:41:40The very trading practices that led to these gargantuan obligations

0:41:40 > 0:41:44the taxpayers are now bailing out all began while he was there.

0:41:44 > 0:41:46Very significant accounting frauds.

0:41:46 > 0:41:50Reinsurance contracts which he participated in structuring,

0:41:50 > 0:41:54that were deemed by a federal jury in Connecticut to be illegal.

0:41:54 > 0:41:56Four people went to jail.

0:41:56 > 0:42:00He was called an unindicted co-conspirator by the prosecutor in that case.

0:42:00 > 0:42:04So his maintaining uninvolvement in the structural issues is simply wrong.

0:42:04 > 0:42:09Spitzer wanted to prosecute Greenberg for financial manipulation,

0:42:09 > 0:42:13but was called off the case by the US Attorney, Michael Garcia.

0:42:13 > 0:42:17Michael Garcia sent me an over-the-top letter

0:42:17 > 0:42:22when we were going to include significant allegations relating to

0:42:22 > 0:42:27Hank Greenberg in our AIG complaint, telling us to back off.

0:42:27 > 0:42:30And it was a moment of...

0:42:30 > 0:42:34I don't say there was anything improper about the letter that

0:42:34 > 0:42:37Garcia sent, but he basically said, "Don't you dare go near this.

0:42:37 > 0:42:41"We're doing this." Relating to Hank Greenberg.

0:42:46 > 0:42:50Michael Garcia never pursued charges against Greenberg.

0:42:50 > 0:42:53Instead, he would lead the prosecution

0:42:53 > 0:42:56that led to Spitzer's downfall.

0:42:56 > 0:43:00Both Greenberg and Langone hired PR firms to go after Spitzer.

0:43:00 > 0:43:04And Langone hired a private investigator to find out what he could.

0:43:06 > 0:43:08I want to move on to the Emperors Club.

0:43:08 > 0:43:11When did that start?

0:43:11 > 0:43:12Approximately.

0:43:12 > 0:43:15- Some time in '06.- Early '06?

0:43:15 > 0:43:18Thereabouts, yeah.

0:43:18 > 0:43:21You were flying about as high as you could possibly be flying.

0:43:21 > 0:43:25At that point in time, you were pretty certain you were going to be

0:43:25 > 0:43:28- Governor of New York, wouldn't you say?- Right.

0:43:28 > 0:43:34Well, if your point is, things were as good as they could get,

0:43:34 > 0:43:37from a political perspective, I suppose that's right.

0:43:37 > 0:43:41And the only metaphor I can think of,

0:43:41 > 0:43:44perhaps, is Icarus.

0:43:44 > 0:43:49Those whom the gods would destroy, they make all-powerful.

0:43:57 > 0:44:02A friend of mine recently gave me a T-shirt that he claimed

0:44:02 > 0:44:06he had had printed for investment banker friends of his.

0:44:06 > 0:44:09But he thought I would enjoy it and maybe I could even learn from it.

0:44:09 > 0:44:13The T-shirt said on its front,

0:44:13 > 0:44:15'Hubris is terminal'.

0:44:15 > 0:44:20# If I ruled the world

0:44:20 > 0:44:21# I'd love all the girls

0:44:21 > 0:44:24# I love 'em, love 'em, baby... #

0:44:24 > 0:44:26I'm not a kingmaker, but I'll call it. You're going to win.

0:44:26 > 0:44:27- Thank you.- I'll tell you why.

0:44:27 > 0:44:30- I'm glad I came tonight! - Absolutely, it's done.

0:44:30 > 0:44:33In early 2006, Spitzer's approval ratings were over 60%.

0:44:33 > 0:44:35He'd announced his run for Governor

0:44:35 > 0:44:37and was predicted to win in a landslide.

0:44:37 > 0:44:40You could do anything. You could punch a toddler and still win!

0:44:40 > 0:44:41AUDIENCE LAUGHS

0:44:41 > 0:44:44His career was every politician's dream.

0:44:44 > 0:44:45I was the enforcer.

0:44:45 > 0:44:47I was the kid who played left full-back.

0:44:47 > 0:44:50Not because I had real talent, but I took people out.

0:44:50 > 0:44:53You play hard, you play rough, and, hopefully, you don't get caught.

0:44:53 > 0:44:55AUDIENCE LAUGHS

0:44:55 > 0:44:59Right around this time, Cecil Suwal, the 22-year-old CEO of the Emperors Club,

0:44:59 > 0:45:02took a phone call from a new customer.

0:45:02 > 0:45:06Though he used the name George Fox, it was actually Eliot Spitzer.

0:45:06 > 0:45:09The very first time that he called,

0:45:09 > 0:45:11I answered the phone

0:45:11 > 0:45:14and he was whispering.

0:45:14 > 0:45:16So I thought it was a prank.

0:45:16 > 0:45:18And so the other booker called and said,

0:45:18 > 0:45:21"OK, I'm ready to start answering the phones."

0:45:21 > 0:45:22So we transferred the phone to her and I said,

0:45:22 > 0:45:24"Oh, I just spoke with someone.

0:45:24 > 0:45:26"I'm going to let you handle that."

0:45:26 > 0:45:29And, apparently, he saw, I think, three people in a row,

0:45:29 > 0:45:31just back to back that evening.

0:45:31 > 0:45:33So I guess it wasn't a prank.

0:45:33 > 0:45:37Reading New York Magazine, George Fox, aka Eliot Spitzer,

0:45:37 > 0:45:42claims he was drawn to websites in the classified ads

0:45:42 > 0:45:45and, while surfing the web, found the Emperors Club.

0:45:45 > 0:45:48# Secret heart

0:45:48 > 0:45:51# What are you made of?

0:45:51 > 0:45:55# What are you so afraid of?

0:45:55 > 0:45:59# Could it be three simple words? #

0:45:59 > 0:46:04When you're sending a girl on a trip to Chicago for 30,000 overnight,

0:46:04 > 0:46:06it doesn't necessarily feel like

0:46:06 > 0:46:08you're running prostitution.

0:46:08 > 0:46:10It feels different.

0:46:10 > 0:46:12And so that's where I think we got a little bit lost,

0:46:12 > 0:46:15as far as the whole legality of the situation.

0:46:15 > 0:46:18# ..This very secret

0:46:18 > 0:46:20# That you're trying... #

0:46:20 > 0:46:23Cecil Suwal dropped out of the University of Miami when she

0:46:23 > 0:46:26fell in love with 60-year-old Mark Brener, who owned the Emperors Club.

0:46:26 > 0:46:28Soon, they were running it together.

0:46:28 > 0:46:30Ceci, as she was called,

0:46:30 > 0:46:34decided to take the Emperors Club in a more high-end direction.

0:46:34 > 0:46:37My primary focus at the time was to promote the website

0:46:37 > 0:46:41to the right people, to the right kinds of girls.

0:46:41 > 0:46:45The number of diamonds that the model had indicated not only

0:46:45 > 0:46:50her hourly and daily rate, but also the general quality of companionship

0:46:50 > 0:46:52you could expect from her.

0:46:52 > 0:46:54So if she was three diamonds,

0:46:54 > 0:46:58her daily rate would be 10,000 and her hourly rate would be 1,000.

0:46:58 > 0:47:03It went 1,000, 1,200, 1,500, 2,100, 3,100.

0:47:03 > 0:47:07And then the day rates, you would just add a zero.

0:47:07 > 0:47:08I did that.

0:47:08 > 0:47:12With mathematical precision, right?!

0:47:12 > 0:47:13Whatever!

0:47:13 > 0:47:15Just add a zero, that should work.

0:47:15 > 0:47:19We had our core girls that we immensely valued that

0:47:19 > 0:47:21really could bring home the bacon.

0:47:21 > 0:47:23Then we had this sort of spiral effect.

0:47:23 > 0:47:26Ashley went for 1,000.

0:47:29 > 0:47:31She certainly wasn't the core.

0:47:31 > 0:47:34She was definitely one of the girls, like, on the edges.

0:47:34 > 0:47:35Sort of peripheries.

0:47:35 > 0:47:39The man known as George Fox became a regular client.

0:47:41 > 0:47:43How often did he meet with Ashley?

0:47:43 > 0:47:46Well, he met her one time.

0:47:46 > 0:47:52And that was the big Mayflower experience for him, I guess.

0:47:52 > 0:47:54But it was just that one time?

0:47:54 > 0:47:55One time.

0:47:57 > 0:47:59How often did you see Governor Spitzer?

0:47:59 > 0:48:04Legally, I am not able to answer that question.

0:48:04 > 0:48:07Court documents say they may have had previous encounters.

0:48:10 > 0:48:13But court documents didn't say that.

0:48:13 > 0:48:18Ashley Dupre let the world believe that she was the 'Luv Guv's girl'.

0:48:18 > 0:48:20But she was only a one-night stand,

0:48:20 > 0:48:24caught on a wiretap at the Mayflower Hotel in Washington DC.

0:48:24 > 0:48:29That begged the question, who else was there?

0:48:29 > 0:48:31There was someone who he enjoyed seeing most.

0:48:31 > 0:48:34And she was very pretty and a very intelligent girl.

0:48:34 > 0:48:36Not a fashion model.

0:48:36 > 0:48:39She had her own career.

0:48:39 > 0:48:42And he liked to meet with her frequently.

0:48:42 > 0:48:45She was actually the first person who said, "Oh, this is Eliot Spitzer."

0:48:47 > 0:48:50The escort chose the name Angelina.

0:48:50 > 0:48:52I discovered who she was and she agreed to speak to me,

0:48:52 > 0:48:55so long as I did not disclose her real name, her face,

0:48:55 > 0:48:57or reveal her voice.

0:48:57 > 0:48:59So I transcribed her interview

0:48:59 > 0:49:02and hired this actress to perform her words.

0:49:10 > 0:49:13He used the name George Fox.

0:49:13 > 0:49:16And he booked an hour at a New York hotel.

0:49:16 > 0:49:18Upper East Side.

0:49:20 > 0:49:24That first time, it was very businesslike.

0:49:24 > 0:49:28You said he wasn't that interested in the companionship.

0:49:30 > 0:49:32Right.

0:49:35 > 0:49:38- You're laughing. I mean, it's like...- It's funny.

0:49:38 > 0:49:40Because he wasn't at all interested in them as a companion?

0:49:40 > 0:49:42I'm not... From what I heard.

0:49:42 > 0:49:47I remember thinking he was, like,

0:49:47 > 0:49:50I hate to put this crudely,

0:49:50 > 0:49:53a 'trying to get his money's worth type client'.

0:49:53 > 0:49:55I said to the agency, you know,

0:49:55 > 0:49:58"I don't want to see that person again."

0:49:58 > 0:50:04In what seems to be a kind of epidemic

0:50:04 > 0:50:06of political figures in sex scandals,

0:50:06 > 0:50:11one question is, why hookers?

0:50:11 > 0:50:14I mean, why, particularly when that's illegal?

0:50:16 > 0:50:21Again, I don't want to delve into...

0:50:21 > 0:50:24I certainly don't want to speak for others and,

0:50:24 > 0:50:25even in my own case,

0:50:25 > 0:50:28I don't really want to speak to that issue,

0:50:28 > 0:50:31except to say that you cave to temptations in a way that

0:50:31 > 0:50:32perhaps seems easier.

0:50:35 > 0:50:41And perhaps is, in some very twisted way, less damaging.

0:50:41 > 0:50:42Less damaging how?

0:50:42 > 0:50:47Than having affairs or relationships that take on a different tenor.

0:50:47 > 0:50:48I'm sorry, had what?

0:50:48 > 0:50:51Relationships that take on a different tenor.

0:50:51 > 0:50:54- You mean, have some sort of emotional...?- Perhaps, yeah.

0:50:54 > 0:50:58Eliot Spitzer had taken the first step into his double life.

0:50:58 > 0:51:01He had just entered a world which, formerly,

0:51:01 > 0:51:05he had seen only from the outside as a prosecutor.

0:51:05 > 0:51:10In April 2004, after wiretapping a social club in Staten Island,

0:51:10 > 0:51:15Spitzer helped the FBI and NYPD bring down a sophisticated prostitution ring.

0:51:15 > 0:51:17He knew how it was done.

0:51:17 > 0:51:22He also knew his life was about to become more public than it had ever been.

0:51:23 > 0:51:25CHEERING AND APPLAUSE

0:51:25 > 0:51:27Ladies and gentlemen, I present to you

0:51:27 > 0:51:30the Governor-Elect of the state of New York,

0:51:30 > 0:51:33the Honorable Eliot Spitzer.

0:51:35 > 0:51:38Taking a record 69% of the vote,

0:51:38 > 0:51:42Eliot Spitzer had a popular mandate to make big changes.

0:51:42 > 0:51:46Together, let's build that one New York.

0:51:46 > 0:51:49Let's walk toward that better day.

0:51:49 > 0:51:53Thank you and God bless the great state of New York!

0:51:53 > 0:51:55CHEERING AND APPLAUSE

0:51:55 > 0:51:57Here he was as Governor of New York.

0:51:57 > 0:51:58He's King of the World.

0:51:58 > 0:52:01He's the future President of the United States.

0:52:01 > 0:52:02Eliot Spitzer's going to fix up this state

0:52:02 > 0:52:04and then he's going to go to Washington and

0:52:04 > 0:52:09do the same thing that he just did for New York for the United States.

0:52:09 > 0:52:11That was in everybody's mind.

0:52:19 > 0:52:20People had said to me before I won,

0:52:20 > 0:52:22"Do to Albany what you did to Wall Street."

0:52:22 > 0:52:24And we tried.

0:52:24 > 0:52:26We went at it with a determination

0:52:26 > 0:52:28that was alien to the culture of Albany.

0:52:34 > 0:52:38The Capitol building in Albany was a monument to corruption.

0:52:38 > 0:52:42America's most expensive government building was like the legislature.

0:52:42 > 0:52:45A bog of waste, double-dealing and graft.

0:52:47 > 0:52:50The gargoyles on the walls haunted the place.

0:52:50 > 0:52:54The maze of grand stairways navigated by special interests

0:52:54 > 0:52:57robbed lawmakers of any sense of perspective.

0:53:00 > 0:53:02It's like in Escher,

0:53:02 > 0:53:05you don't know if you're going up or down, left or right.

0:53:05 > 0:53:08The mind gets turned upside down inside that building.

0:53:10 > 0:53:13I think, over the years, that some people have appropriately seen it

0:53:13 > 0:53:17as a metaphor for the labyrinthian nature of New York politics.

0:53:17 > 0:53:21It's time for "Live from the State Capitol!" with Fred Dicker.

0:53:21 > 0:53:25Fred Dicker of the New York Post was a 25-year veteran in Albany.

0:53:25 > 0:53:27This is Fred Dicker, live at the state capitol.

0:53:27 > 0:53:29What a beautiful day it's going to be...

0:53:29 > 0:53:31Deeply conservative, Dicker was proud of calling himself

0:53:31 > 0:53:33"an equal-opportunity prick",

0:53:33 > 0:53:36attacking whomever came into office.

0:53:36 > 0:53:38Eliot Spitzer, who didn't suffer fools lightly,

0:53:38 > 0:53:40was treating a separate branch of government,

0:53:40 > 0:53:43the legislature that could block him at every turn,

0:53:43 > 0:53:44as if he could just push them around

0:53:44 > 0:53:46like they were Wall Street executives.

0:53:46 > 0:53:48Well, they pushed back, and they pushed back hard.

0:53:48 > 0:53:53The man who pushed back hardest was Republican Senate leader Joe Bruno.

0:53:53 > 0:53:55A charming old-school dealmaker,

0:53:55 > 0:53:58he wasn't much interested in Spitzer's reforms.

0:53:58 > 0:54:02He thought that he really was, sort of, the second coming.

0:54:02 > 0:54:04And that he was going to get

0:54:04 > 0:54:06everybody to do what he wanted to do.

0:54:06 > 0:54:10I think he started thinking dictatorially, almost,

0:54:10 > 0:54:11you know, in his own mind.

0:54:11 > 0:54:13I think Eliot's view of it was,

0:54:13 > 0:54:15we would force them to do the right thing.

0:54:15 > 0:54:18But it's not the way the system is set up.

0:54:18 > 0:54:20Again, I don't want to just say you're wrong,

0:54:20 > 0:54:21but you are.

0:54:21 > 0:54:23LAUGHTER

0:54:23 > 0:54:25I'd say to him, "Boss, this system is set up

0:54:25 > 0:54:27"so that only incremental change is possible."

0:54:27 > 0:54:29And he'd be, like, "Goddamn it, no, it's not."

0:54:29 > 0:54:32And the result that it produced is that he began to go around Mr Bruno

0:54:32 > 0:54:35to specific members of the State Senate.

0:54:35 > 0:54:39Mr Bruno took that to be a hostile act.

0:54:41 > 0:54:45He quickly announced publicly he's going to take me out as leader.

0:54:45 > 0:54:47I'm history.

0:54:47 > 0:54:50And the Republican majority was going to cease to exist.

0:54:50 > 0:54:51He was going to take us out.

0:54:53 > 0:54:54I said something like,

0:54:54 > 0:54:58"You know, I've been threatened by hoods and thugs my whole life.

0:54:58 > 0:55:00"You're just an amateur.

0:55:00 > 0:55:03"If you think you're going to bother me, you just don't."

0:55:10 > 0:55:15We knew that folks would come down hard on us if we ever stumbled.

0:55:15 > 0:55:17He said, "You're damn right.

0:55:17 > 0:55:19"If we ever fall, they'll kick us in the nuts."

0:55:19 > 0:55:23Which is why, you know, the downfall was so shocking.

0:55:26 > 0:55:29Did it begin to haunt you as something you thought was possible

0:55:29 > 0:55:31that you were going to get caught?

0:55:31 > 0:55:34Or did that not even occur to you?

0:55:34 > 0:55:37No, of course it does.

0:55:37 > 0:55:38Of course it does.

0:55:38 > 0:55:41And you just deal with it.

0:55:43 > 0:55:45How did you deal with it?

0:55:45 > 0:55:47Those are the mysteries of the human mind, I suppose.

0:55:47 > 0:55:50I don't think I can answer that question

0:55:50 > 0:55:53because I don't think I know.

0:56:08 > 0:56:14I got a call months later and this was kind of a last-minute thing.

0:56:14 > 0:56:16This was at the Waldorf hotel.

0:56:18 > 0:56:22He showed up with this baseball cap on, like, clearly trying

0:56:22 > 0:56:24not to be recognised.

0:56:24 > 0:56:27And I'm, like, you know,

0:56:27 > 0:56:28"Don't tell me it's THAT guy again!"

0:56:32 > 0:56:36In that second meeting, I was rather pushy with him.

0:56:36 > 0:56:40I was, like, "We're going to sit and have a chit-chat

0:56:40 > 0:56:42"and have a nice little date here."

0:56:44 > 0:56:47And it ended up being a fun couple of hours.

0:56:47 > 0:56:50I thought it was Eliot Spitzer,

0:56:50 > 0:56:52but I couldn't be absolutely sure.

0:56:52 > 0:56:54So I made a point to look out for him in the papers.

0:56:54 > 0:56:58And it was at that point that I said to the people who ran the agency,

0:56:58 > 0:57:00"You know who this guy is, don't you?"

0:57:00 > 0:57:03And they said, "No."

0:57:03 > 0:57:06He was hiding. He didn't want anyone to know who we was.

0:57:06 > 0:57:08He was extremely paranoid.

0:57:08 > 0:57:12He knew that his entire political career was on the line.

0:57:12 > 0:57:15And, ultimately, vice just took over virtue.

0:57:15 > 0:57:16He could not control himself.

0:57:16 > 0:57:18I don't know.

0:57:18 > 0:57:21I just remember one time, he was trying to book an appointment.

0:57:21 > 0:57:25I just remember thinking to myself, "This man is so paranoid,

0:57:25 > 0:57:28"he's just going to attract a situation."

0:57:28 > 0:57:30You know, because he was just asking for it.

0:57:30 > 0:57:34It's, like, "Listen, man, if you are so worried about what you're doing, don't do it!"

0:57:34 > 0:57:40I never acknowledged who he was, but he knew that I knew.

0:57:40 > 0:57:42He started to request me.

0:57:42 > 0:57:44I saw him outside of New York in...

0:57:44 > 0:57:47Palm Beach, Puerto Rico,

0:57:47 > 0:57:50Dallas, Washington.

0:57:50 > 0:57:53He was always very guarded about what he would say.

0:57:53 > 0:57:57And I would insist on having a conversation before we started.

0:57:57 > 0:58:01I'm like, "I'm totally taking advantage of this,

0:58:01 > 0:58:03"cos he's so smart and interesting."

0:58:03 > 0:58:07I would, like, have my little rants about what was wrong with

0:58:07 > 0:58:09New York City that needed to be fixed.

0:58:09 > 0:58:11And he listened.

0:58:15 > 0:58:17When I saw him out, with his wife, with his children,

0:58:17 > 0:58:19he had it all together.

0:58:19 > 0:58:22You know, what was strange with Eliot Spitzer was

0:58:22 > 0:58:25he could be pleasant and charming and act very caring.

0:58:25 > 0:58:28When my wife was reported as being seriously ill,

0:58:28 > 0:58:30he called me several times.

0:58:30 > 0:58:34And this is right in the height of some of our worst exchanges.

0:58:34 > 0:58:36Couldn't have been any more pleasant.

0:58:36 > 0:58:41But when he came after me in what was called Troopergate,

0:58:41 > 0:58:45then it was apparent that this man really intended to destroy me.

0:58:45 > 0:58:47In the Spitzer-Bruno war,

0:58:47 > 0:58:51the biggest battle was Troopergate, so-called because of the way

0:58:51 > 0:58:55state troopers may have been misused for political purposes.

0:58:55 > 0:58:59It was an attack on Bruno that would boomerang on Spitzer.

0:58:59 > 0:59:01It was a Sunday and I was reading the local newspaper,

0:59:01 > 0:59:04the Albany Times Union, and there was a story on the front page.

0:59:04 > 0:59:08Its suggestion was that Bruno had misused state helicopters

0:59:08 > 0:59:12and other state travel for personal and political purposes.

0:59:14 > 0:59:17A careful examination of Bruno's travel logs revealed that

0:59:17 > 0:59:20state troopers had ferried Bruno on extended visits to see

0:59:20 > 0:59:22Spitzer's political enemies.

0:59:22 > 0:59:24Including a trip to C.V. Starr,

0:59:24 > 0:59:28the office of Hank Greenberg.

0:59:28 > 0:59:31Do you recall Senator Joe Bruno coming to see you?

0:59:31 > 0:59:33Yeah, Joe Bruno would come from time to time to see me.

0:59:33 > 0:59:35They're always trying to raise money.

0:59:35 > 0:59:38When he came, did you talk Spitzer?

0:59:38 > 0:59:40I don't recall that.

0:59:40 > 0:59:43I don't think... If we did, it wasn't...

0:59:43 > 0:59:45it wasn't a major topic of our conversation.

0:59:48 > 0:59:51Spitzer's enemies were beginning to talk to each other.

0:59:51 > 0:59:54To push the attack on Spitzer,

0:59:54 > 0:59:56Joe Bruno hired a political operative

0:59:56 > 0:59:58who revelled in his reputation as

0:59:58 > 1:00:02the country's most notorious dirty trickster, Roger Stone.

1:00:02 > 1:00:05There you have Mr Clean, the Sheriff of Wall Street,

1:00:05 > 1:00:08someone for whom ethics is his signature issue,

1:00:08 > 1:00:13charging that Bruno is dirty.

1:00:13 > 1:00:14This is a tyrant, a megalomaniac.

1:00:14 > 1:00:17A would-be dictator who really believes that in government,

1:00:17 > 1:00:21you somehow either have the right, by getting a lot of votes or being

1:00:21 > 1:00:26born to privilege, to just issue orders and people do what you say.

1:00:26 > 1:00:30Stone was this, like, legendary figure.

1:00:30 > 1:00:32He had his hair dyed.

1:00:32 > 1:00:34He was a swinger, in literal terms.

1:00:34 > 1:00:39Even in his own Republican ranks, he was regarded as a maverick,

1:00:39 > 1:00:42if not gadfly, if not lunatic.

1:00:42 > 1:00:45But 'crazy like a fox kind of a guy', I guess.

1:00:45 > 1:00:48Sure, I believe in a Gonzo brand of politics

1:00:48 > 1:00:50because you have to get people's attention.

1:00:50 > 1:00:53In a world where there's so much competition for their attention,

1:00:53 > 1:00:56politically, and then there's the rest of life.

1:00:56 > 1:00:59Sports, food, entertainment, whatever it is.

1:00:59 > 1:01:01You're competing for all of that because politics,

1:01:01 > 1:01:04like all those other things, is entertainment.

1:01:04 > 1:01:09In 1996, Stone was fired from the Dole presidential campaign when

1:01:09 > 1:01:12it was revealed that he and his wife had marketed themselves as swingers.

1:01:12 > 1:01:15"We are seeking similar couples,"

1:01:15 > 1:01:18said the ad, "or exceptional, muscular, well-hung single men."

1:01:20 > 1:01:22But that didn't stop Roger.

1:01:22 > 1:01:24An elegant dresser with a taste for Martinis,

1:01:24 > 1:01:29he reinvented himself as a charming secret agent, with a licence to kill.

1:01:29 > 1:01:33He revelled in the body politic and his own bodybuilding.

1:01:33 > 1:01:38Just below his neckline, he bore a tattoo of his hero, Richard Nixon.

1:01:38 > 1:01:42Just a few weeks after Bruno hired Stone, a mysterious voice message

1:01:42 > 1:01:45was left on the phone of Spitzer's 80-year-old father.

1:01:45 > 1:01:49This is a message for Bernard Spitzer.

1:01:49 > 1:01:52You WILL be subpoenaed to testify

1:01:52 > 1:01:55before the Senate Committee on investigations

1:01:55 > 1:01:57on your shady campaign loans.

1:01:57 > 1:02:00If you resist the subpoena, you WILL be arrested and brought to Albany.

1:02:00 > 1:02:03And there's not a Goddamn thing your phoney,

1:02:03 > 1:02:07psycho, piece of shit son can do about it.

1:02:07 > 1:02:11Bernie, your phoney loans are about to catch up with you.

1:02:11 > 1:02:13You WILL be forced to tell the truth.

1:02:13 > 1:02:16And the fact that your son's a pathological liar

1:02:16 > 1:02:19will be known to all.

1:02:19 > 1:02:22We spent some time and effort to see where it came from.

1:02:22 > 1:02:25It came from an apartment that had been rented by either him

1:02:25 > 1:02:27or a company that he owned.

1:02:27 > 1:02:31And the voice, we were able to compare from the voice message

1:02:31 > 1:02:34he'd left on the voicemail to appearances he had made on TV.

1:02:34 > 1:02:36And we got a voice analyst to say it's the same voice.

1:02:36 > 1:02:39And people who knew him said, "Yeah, that's Roger Stone's voice."

1:02:39 > 1:02:41The tape did sound eerily like me.

1:02:41 > 1:02:46Ultimately, private investigators that I retained determined that

1:02:46 > 1:02:49there had been a tap on my phone at 40 Central Park South.

1:02:49 > 1:02:52I now believe that a rogue unit of the New York State Police,

1:02:52 > 1:02:55under the direction of Eliot Spitzer, was monitoring my calls.

1:02:55 > 1:02:59In other words, I think the tape that was released was pasted together.

1:02:59 > 1:03:01It was, er, it was a...

1:03:01 > 1:03:03It was a put-up job.

1:03:03 > 1:03:09The FBI called my dad's office and asked to come by.

1:03:11 > 1:03:15On September 6th, 2007, Agent Katzman from the FBI

1:03:15 > 1:03:19visited Bernard Spitzer at his Manhattan offices.

1:03:19 > 1:03:25The questions didn't focus much on what Roger Stone had done,

1:03:25 > 1:03:28or allegedly done, or the issues relating to the phone call.

1:03:28 > 1:03:30It was more about me.

1:03:30 > 1:03:33Did you think anything about that in retrospect?

1:03:33 > 1:03:35In retrospect, it has crossed my mind.

1:03:35 > 1:03:37And it crossed your mind in what way, since then?

1:03:37 > 1:03:41Well, wondering whether this was part of the investigation

1:03:41 > 1:03:43that led to my downfall.

1:03:49 > 1:03:53The FBI showed up at my apartment.

1:03:53 > 1:03:57They just showed up at 8am and they said, "We want to talk to you.

1:03:57 > 1:04:00"We think you know what this is about."

1:04:00 > 1:04:03Bruno fired Stone because of the phone call.

1:04:03 > 1:04:05But Stone confirms that he was

1:04:05 > 1:04:08then hired by wealthy, motivated Republicans

1:04:08 > 1:04:10to stay on the Spitzer detail.

1:04:10 > 1:04:14A few months later, Rich Baum, Secretary to the Governor,

1:04:14 > 1:04:16received an email from Stone's consulting company.

1:04:20 > 1:04:25The question is, how did the investigation of Spitzer begin?

1:04:25 > 1:04:30The government claims it spotted a suspicious wire transfer of several thousand dollars.

1:04:30 > 1:04:31What was interesting to me

1:04:31 > 1:04:35is that the whole thing comes from a single money transfer

1:04:35 > 1:04:38that sort of sent up a red flag.

1:04:38 > 1:04:40A suspicious activity report.

1:04:40 > 1:04:44Every day, there are thousands of these suckers filed.

1:04:44 > 1:04:48The Federal Clearinghouse receives 3,400 suspicious activity reports,

1:04:48 > 1:04:51or SARs, every day.

1:04:51 > 1:04:55Someone had to have taken a very personal interest in this

1:04:55 > 1:04:59particular transaction and kind of shepherded it through the process

1:04:59 > 1:05:02in order for it to be the subject of a lot of attention and,

1:05:02 > 1:05:05ultimately, be the basis for a case.

1:05:05 > 1:05:09The SAR was filed by North Fork Bank, after Spitzer asked the bank

1:05:09 > 1:05:12to keep his name off a 5,000 wire

1:05:12 > 1:05:15to something called QAT Consulting.

1:05:15 > 1:05:20My understanding is that they didn't even know what QAT Consulting was,

1:05:20 > 1:05:22and that they called Morganthau's office.

1:05:22 > 1:05:25Robert Morgenthau, the Manhattan District Attorney,

1:05:25 > 1:05:30was surprised when the federal government came looking for help on how to prosecute escort services.

1:05:30 > 1:05:33The feds just didn't do prostitution cases.

1:05:33 > 1:05:37They also naively asked if it was common to prosecute customers.

1:05:37 > 1:05:39The answer from Morgenthau's office was, no.

1:05:41 > 1:05:44Once they figured out it was a prostitution ring,

1:05:44 > 1:05:46then it seems to me you're at a juncture on the road here.

1:05:46 > 1:05:49Once you realise that it's just

1:05:49 > 1:05:52a governor with a hard-on,

1:05:52 > 1:05:54the most you're going to get out of this is

1:05:54 > 1:05:55a news story and a resignation.

1:05:55 > 1:05:58I think the government has better things to do.

1:05:58 > 1:06:02The US Attorney for the Southern District of New York was Michael Garcia,

1:06:02 > 1:06:06the man who had tangled with Spitzer over the investigation of Hank Greenberg.

1:06:06 > 1:06:09Normally focused on terrorists, mobsters and Wall Street,

1:06:09 > 1:06:12Garcia's office was suddenly spending enormous

1:06:12 > 1:06:15resources to go after a small escort service.

1:06:15 > 1:06:17Garcia was a Republican.

1:06:17 > 1:06:19Was this a political hit?

1:06:19 > 1:06:22The Spitzer investigation began at the very moment when

1:06:22 > 1:06:25the Justice Department was involved in a huge scandal of its own.

1:06:25 > 1:06:29And the issue was whether the Justice Department was hiring and firing

1:06:29 > 1:06:30US attorneys based on politics.

1:06:30 > 1:06:33And whether it was going after powerful Democrats,

1:06:33 > 1:06:34in order to get rid of them.

1:06:34 > 1:06:37The only banking activity that seemed to interest them

1:06:37 > 1:06:39was Eliot Spitzer's banking activity.

1:06:39 > 1:06:43As we sunk deeper and deeper

1:06:43 > 1:06:47into this horrendous banking scandal that's convulsing the country,

1:06:47 > 1:06:54suspicious banking activity by Eliot Spitzer and the United States Government was on the trail.

1:06:54 > 1:06:57After notifying superiors in Washington,

1:06:57 > 1:07:00the US Attorneys' Office obtained permission

1:07:00 > 1:07:03to wiretap the phones and emails of the Emperors Club.

1:07:12 > 1:07:14The night before, it's, like, 8pm.

1:07:14 > 1:07:17We're both sitting at our computers and all of this information,

1:07:17 > 1:07:20our client information, is being sucked out of the computers.

1:07:20 > 1:07:23And we're, like, "Oh, my goodness! We have hackers."

1:07:23 > 1:07:27We download some kind of encryption software and try to,

1:07:27 > 1:07:30like, save our information, whatever's left.

1:07:30 > 1:07:32And then we go to bed as usual.

1:07:32 > 1:07:36And, 6:30am, bang, bang, bang.

1:07:36 > 1:07:38It's the FBI.

1:07:38 > 1:07:39OK? Shock.

1:07:39 > 1:07:41KNOCKS ON DOOR

1:07:41 > 1:07:43Miss Suwal, are you home?

1:07:43 > 1:07:47I was certainly unprepared... to just be woken up

1:07:47 > 1:07:51out of my sleep at 6:30am and have the FBI come in their

1:07:51 > 1:07:56bullet-proof vests, asking me if there are firearms in the house.

1:07:56 > 1:08:01And all I'm thinking, like, "That cash is going to get us in trouble."

1:08:01 > 1:08:06Ceci and Mark Brener had nearly 1 million in cash

1:08:06 > 1:08:07in a safe in their closet.

1:08:10 > 1:08:12One of the FBI men came in and he was, like,

1:08:12 > 1:08:15"We are closing Emperors Club VIP."

1:08:15 > 1:08:18And I was, like, "Oh! Oh."

1:08:18 > 1:08:22My God, my stomach, my everything.

1:08:22 > 1:08:25My baby. It was just surreal.

1:08:25 > 1:08:28I mean, that was, like, my child.

1:08:28 > 1:08:34The essence of what went on here was, in federal law terms,

1:08:34 > 1:08:35a violation of the Mann Act.

1:08:37 > 1:08:40Known as the White-Slave Act, the Mann Act made it a crime to

1:08:40 > 1:08:44transport women across state lines for immoral purposes.

1:08:44 > 1:08:47That is why federal prosecutors were particularly

1:08:47 > 1:08:51interested in out-of-town dates with Angelina and Ashley.

1:08:51 > 1:08:55In recent years, it's used to go after child prostitution rings.

1:08:55 > 1:08:57It is never used to prosecute Johns or customers.

1:08:59 > 1:09:03We have to look at these statutes in terms of standards of enforcement.

1:09:03 > 1:09:05Is this statute, in fact,

1:09:05 > 1:09:08being enforced that way uniformly across the country?

1:09:08 > 1:09:10And the answer is, it is not.

1:09:10 > 1:09:13Why, then, did the Department of Justice want the case?

1:09:13 > 1:09:16After months of investigating Spitzer,

1:09:16 > 1:09:18Michael Garcia's deputy suddenly sent emails to

1:09:18 > 1:09:21Washington, seeking support for using the Mann Act.

1:09:21 > 1:09:26Wiretaps revealed many customers who paid for escorts, all over the world.

1:09:26 > 1:09:29But Garcia's office was only interested in prosecuting

1:09:29 > 1:09:31one of the customers.

1:09:31 > 1:09:34They pressured me, like they do on TV.

1:09:34 > 1:09:38And they said, "We know you worked for this agency.

1:09:38 > 1:09:40"And we want you to look at some pictures,

1:09:40 > 1:09:44"And tell us if you recognise anyone," and I did that.

1:09:44 > 1:09:48And Eliot Spitzer was in there and I said I recognised him

1:09:48 > 1:09:50and I had seen him.

1:09:50 > 1:09:54And I said, "Should I maybe have a lawyer?"

1:09:54 > 1:09:58And they said, "Well, we want to keep this confidential."

1:09:58 > 1:10:02The main thing about that meeting was that they were very insistent

1:10:02 > 1:10:05and pressuring me in an uncomfortable way, you know,

1:10:05 > 1:10:08for me to admit that I had sex with Eliot Spitzer.

1:10:10 > 1:10:13You know, why him and why not anyone else?

1:10:15 > 1:10:16The question remained,

1:10:16 > 1:10:20how did the US Government first find out about Spitzer?

1:10:20 > 1:10:23Was the FBI tipped off by one of Spitzer's enemies?

1:10:25 > 1:10:31I was in a private club, an adult-themed club in Miami, called Miami Velvet.

1:10:31 > 1:10:34There was a woman sitting at the bar.

1:10:34 > 1:10:36I was sitting at the bar and we began a conversation.

1:10:36 > 1:10:41I asked her what she did and she said she was professionally a call girl,

1:10:41 > 1:10:43but she wasn't working this particular night.

1:10:43 > 1:10:45I said, "What kind of clients do you have?"

1:10:45 > 1:10:47She had athletes.

1:10:47 > 1:10:49She had captains of industry.

1:10:49 > 1:10:52She had prominent businessmen.

1:10:52 > 1:10:53She had politicians and so on.

1:10:53 > 1:10:55I said, "Well, like who?"

1:10:55 > 1:10:56She said, "Recently,

1:10:56 > 1:11:01"I almost had a date with the Governor of New Jersey."

1:11:01 > 1:11:04I said, "Jon Corzine? You had a date with Jon Corzine?"

1:11:04 > 1:11:07She said, "Who's he? I had a date with Eliot Spitzer."

1:11:07 > 1:11:11I said, "No, Eliot Spitzer's the Governor of New York, not New Jersey."

1:11:11 > 1:11:13She said, "Yeah, well, I'm not into politics."

1:11:13 > 1:11:15I said, "Was there anything else notable?"

1:11:15 > 1:11:17She said, "Well, he was kind of weird."

1:11:17 > 1:11:19I said, "What do you mean?"

1:11:19 > 1:11:23She said, "Well, he had these black knee socks and he kept them on the whole time."

1:11:23 > 1:11:25So I ask you, what kind of guy fucks with his socks on?

1:11:28 > 1:11:30The black socks thing isn't true.

1:11:30 > 1:11:32He wore low-cut socks.

1:11:32 > 1:11:34And he took them off.

1:11:34 > 1:11:38The next day, I discussed it with my attorneys and I asked them to

1:11:38 > 1:11:41contact the FBI and tell them what we knew in a formal letter.

1:11:41 > 1:11:45Now, I don't claim that this was a revelation to the federal investigators.

1:11:45 > 1:11:49It may have been a piece of the puzzle that they were putting together.

1:11:49 > 1:11:52I may have started an investigation in an area they weren't looking at.

1:11:52 > 1:11:55I have no idea. And I haven't made any claim.

1:11:55 > 1:11:57The FBI insists that it never received

1:11:57 > 1:12:00a letter from Stone's attorney.

1:12:07 > 1:12:10It wasn't an addiction. It was a desire.

1:12:10 > 1:12:12A need to find an outlet that was not within

1:12:12 > 1:12:18the very confined world that I had been living.

1:12:18 > 1:12:21Had you found a way to completely compartmentalise it?

1:12:21 > 1:12:23Yep. Yeah.

1:12:25 > 1:12:28And was that the beauty of it, in a way, as you saw it?

1:12:28 > 1:12:33Look, I don't want to go there, but it did not affect governance and,

1:12:33 > 1:12:36in fact, I can say with certainty

1:12:36 > 1:12:40in February/March of '08,

1:12:40 > 1:12:41people were beginning to say,

1:12:41 > 1:12:44"Hey, wait a minute, their strategy is working."

1:12:44 > 1:12:46We were winning the political races,

1:12:46 > 1:12:48getting the economic agenda in place.

1:12:48 > 1:12:51People were beginning to see that the chess game was playing out.

1:12:51 > 1:12:53APPLAUSE

1:12:53 > 1:12:58Join me in good faith. I will meet you with an open hand.

1:12:58 > 1:13:01For we will realise this opportunity best

1:13:01 > 1:13:05if we work together in a spirit of cooperation.

1:13:05 > 1:13:07APPLAUSE

1:13:07 > 1:13:09We'd been through so much.

1:13:09 > 1:13:13And we'd had a very successful State of the State Address.

1:13:13 > 1:13:16We'd had a great budget announcement.

1:13:16 > 1:13:20And we really thought we were turning the corner.

1:13:20 > 1:13:25In fact, we were at a bar and one of the senior advisers to the Governor

1:13:25 > 1:13:27raised his glass, in what, I'm sure,

1:13:27 > 1:13:32was the moment that jinxed us all, and said, "To turning the corner!"

1:13:32 > 1:13:34Well, didn't turn the corner.

1:13:34 > 1:13:36When did you first have an inclination

1:13:36 > 1:13:40that you were going to have a serious political problem?

1:13:43 > 1:13:50The Thursday when it was announced

1:13:50 > 1:13:53that a case had been made against Emperors Club.

1:13:57 > 1:14:01And when that came out, what did you think?

1:14:01 > 1:14:04I said, "This is an issue."

1:14:07 > 1:14:10The FBI wiretaps of the Emperors Club intercepted

1:14:10 > 1:14:16more than 5,000 phone calls and text messages and more than 6,000 emails.

1:14:16 > 1:14:20They knew where I'd been. They had dates and times.

1:14:20 > 1:14:23On one trip, the booker and I were texting back and forth.

1:14:23 > 1:14:27She would say, "He's there now and he's ready to see you."

1:14:27 > 1:14:30And I would say, "OK, I'm heading over there."

1:14:30 > 1:14:34They said, "Look, we already know all about you.

1:14:34 > 1:14:41"We know you were at this hotel at this time and, ten minutes later, you were here. We know this."

1:14:41 > 1:14:45The list of charges against the Emperors Club in the affidavit

1:14:45 > 1:14:48was surprisingly detailed.

1:14:48 > 1:14:54As a piece of writing, it was crafted like a mystery story, full of clues.

1:14:54 > 1:14:58It teased the reader with a few sentences each on Clients 1 to 8.

1:14:58 > 1:15:02And then five riveting pages on Client number 9.

1:15:02 > 1:15:03And his one date with Kristen,

1:15:03 > 1:15:06otherwise known as Ashley Dupre,

1:15:06 > 1:15:10at the Mayflower Hotel in Washington DC.

1:15:10 > 1:15:15The affidavit was filled with all sorts of crucial details

1:15:15 > 1:15:18that allowed reporters to go off and find out who Client 9 was.

1:15:20 > 1:15:25The Times won a Pulitzer because they did things like, they went to

1:15:25 > 1:15:29every major hotel in Washington and figured out who was in that suite in which hotel,

1:15:29 > 1:15:33cos they didn't know which hotel he was in.

1:15:33 > 1:15:37The affidavit was full of steamy sexual banter,

1:15:37 > 1:15:42and concerns about whether the client was difficult or even safe.

1:15:42 > 1:15:46Was the writing meant to convict the accused, or embarrass the client?

1:15:48 > 1:15:51An FBI guy with sandy-coloured hair

1:15:51 > 1:15:55and a moustache brought up something from the wiretap.

1:15:55 > 1:15:58He said, "We heard that sometimes, you were asked to bring sex toys."

1:15:58 > 1:16:01And the guy kept pressing me.

1:16:01 > 1:16:04It was like he wanted to get some kind of information about

1:16:04 > 1:16:07some kinky sex stuff, or something juicy that happened.

1:16:07 > 1:16:09You know, like, the Governor's into whatever.

1:16:09 > 1:16:14And I flat-out said, "I don't see how any of that is relevant

1:16:14 > 1:16:17"to your investigation to prosecute what you're trying to prosecute."

1:16:17 > 1:16:21There was nothing. Maybe some sexy lingerie or something.

1:16:21 > 1:16:23But that was all I ever took.

1:16:23 > 1:16:25There were a number of leaks in this case.

1:16:25 > 1:16:27Most obviously to the New York Times.

1:16:27 > 1:16:31But a couple of New York TV stations also were onto the story.

1:16:31 > 1:16:34And the Albany Times Union got sent the criminal affidavit

1:16:34 > 1:16:35in the Emperors Club case.

1:16:35 > 1:16:38And its reporter was told specifically to look at Client 9

1:16:38 > 1:16:43and told that he was a wealthy New York public official.

1:16:43 > 1:16:46Eliot Spitzer was never charged with any crime.

1:16:46 > 1:16:49So you really have to wonder whether or not

1:16:49 > 1:16:53the purpose of the investigation at some point became the leak.

1:16:53 > 1:16:55Some breaking news this afternoon.

1:16:55 > 1:16:59The New York Times is reporting that Governor Eliot Spitzer of New York

1:16:59 > 1:17:02has informed some of his senior administration officials

1:17:02 > 1:17:05that he had been involved in a prostitution ring.

1:17:05 > 1:17:06I recessed the conference.

1:17:06 > 1:17:10We went into my office, the whole conference, and had the TV on.

1:17:10 > 1:17:12Cheers erupted on trading floors around the city

1:17:12 > 1:17:16as word spread of Governor Spitzer's stunning downfall.

1:17:16 > 1:17:20Some traders reportedly broke out bottles of champagne to celebrate.

1:17:20 > 1:17:22They weren't the only ones.

1:17:22 > 1:17:26Four diners at the 21 Club claim that they spotted Dick Grasso,

1:17:26 > 1:17:31Hank Greenberg and Ken Langone celebrating Spitzer's fall with a magnum of champagne.

1:17:33 > 1:17:36- You say that you were surprised by this news?- Not at all.

1:17:36 > 1:17:39I had no doubt about his lack of character and integrity.

1:17:39 > 1:17:42It would only be a matter of time. I didn't think he'd do it this soon.

1:17:42 > 1:17:44Or the way he did it.

1:17:44 > 1:17:47We do know that Ken Langone told CNBC,

1:17:47 > 1:17:50shortly after all of this broke,

1:17:50 > 1:17:53that he had a friend who was in the post office.

1:17:53 > 1:17:57I know for sure he went, himself, to a post office

1:17:57 > 1:18:02and bought 2,800-worth of mail orders to send to the hooker.

1:18:02 > 1:18:04- How do you know that?- I know it.

1:18:04 > 1:18:07Why is CNBC sticking a mic underneath his mouth?

1:18:07 > 1:18:10Because he was...

1:18:10 > 1:18:12enemy number one.

1:18:12 > 1:18:14Spitzer's now. It's his turn.

1:18:14 > 1:18:18And the guy's in the back of him, waiting to go and buy a money order.

1:18:18 > 1:18:22And Spitzer goes up and buys 1,800-worth of money orders.

1:18:22 > 1:18:24So you're saying that he said he had a friend

1:18:24 > 1:18:27who stood behind Eliot Spitzer in the post office line,

1:18:27 > 1:18:29overheard him sending a money order for a prostitute?

1:18:29 > 1:18:31I mean, this is too amazing to be true!

1:18:31 > 1:18:35It was totally coincidental that somebody tells me this

1:18:35 > 1:18:37an hour before that.

1:18:37 > 1:18:38It's God at work, I'm telling you.

1:18:38 > 1:18:41Here's God saying, "Here's a little bit more for you."

1:18:41 > 1:18:43Unless you think Ken Langone

1:18:43 > 1:18:45has friends who call him from post offices,

1:18:45 > 1:18:49my hunch would be that it was someone closer to him than a friend.

1:18:51 > 1:18:53What do you mean, someone closer to him than a friend?

1:18:53 > 1:18:54An employee.

1:18:54 > 1:18:56A consultant.

1:18:56 > 1:18:59Somebody that he hired to be there.

1:18:59 > 1:19:02That would be my hunch. But do I know that?

1:19:02 > 1:19:05Is he going to tell us that? He said it was a friend.

1:19:05 > 1:19:06Why he volunteered this information,

1:19:06 > 1:19:08he just couldn't stop himself from crowing.

1:19:08 > 1:19:11I didn't have any private eyes on him.

1:19:11 > 1:19:14I didn't have any dirty tricks guys on him.

1:19:14 > 1:19:15None of that.

1:19:15 > 1:19:19"I knew before the rest of you guys." Well, how did he know?

1:19:19 > 1:19:23I don't know, but I did discuss it with the Governor

1:19:23 > 1:19:25and the Governor felt like he was under surveillance.

1:19:25 > 1:19:28He thought he was under surveillance.

1:19:41 > 1:19:44The day I gave my proffer, I walked out of the courthouse

1:19:44 > 1:19:48and there were journalists suddenly, everywhere.

1:19:48 > 1:19:51I went straight to the bar. I had a couple of drinks.

1:19:51 > 1:19:54And I was sitting in the bar and a news reporter sat down

1:19:54 > 1:19:57next to me and said, "What do you think of the Eliot Spitzer news?"

1:19:57 > 1:20:00And I was, like, "Oh, my God! They've got me already."

1:20:00 > 1:20:03I was, like, freaking out.

1:20:03 > 1:20:06The very day the news broke, there were messages

1:20:06 > 1:20:10on Angelina's phone from reporters he wanted to talk.

1:20:10 > 1:20:13Mysteriously, they knew her real name and her phone number,

1:20:13 > 1:20:17information only available to the government investigation.

1:20:20 > 1:20:23Angelina left town and never returned the calls.

1:20:29 > 1:20:34I do not believe that politics in the long run is about individuals.

1:20:34 > 1:20:36It is about ideas, the public good,

1:20:36 > 1:20:40and doing what is best for the state of New York.

1:20:40 > 1:20:44But I have disappointed and failed to live up to the standard

1:20:44 > 1:20:45I expected of myself.

1:20:45 > 1:20:49I must now dedicate some time to regain the trust of my family.

1:20:49 > 1:20:52I will not be taking questions. Thank you very much.

1:20:52 > 1:20:57I will report back to you in short order. Thank you very much.

1:21:07 > 1:21:09Everybody was just in shock.

1:21:09 > 1:21:11I was angry, and that was the last thing

1:21:11 > 1:21:13I ever would have expected of him

1:21:13 > 1:21:16to have done. My heart broke for Silda.

1:21:16 > 1:21:18I knew Silda very well,

1:21:18 > 1:21:20and his family.

1:21:20 > 1:21:25They'd always seemed to have such a strong relationship and a bond.

1:21:28 > 1:21:31Did you learn something about your wife that you didn't expect,

1:21:31 > 1:21:33as a result of this experience?

1:21:36 > 1:21:38I wish I hadn't needed to learn it.

1:21:38 > 1:21:43But I learned that the depths of her forgiveness are deeper

1:21:43 > 1:21:47than are ever to be called for.

1:21:51 > 1:21:54After the initial announcement, Spitzer considered his options.

1:21:54 > 1:21:58Despite her pain, his wife encouraged him to stay on as Governor.

1:21:58 > 1:22:02Calls went out to the leaders of the State House and Senate.

1:22:02 > 1:22:04No-one would support him.

1:22:04 > 1:22:07The reservoir of goodwill was empty.

1:22:07 > 1:22:11The combative style left him without friends and defenders in the end.

1:22:11 > 1:22:14The only relevant question, really,

1:22:14 > 1:22:18was, what could I do to minimise the continued pain to my family?

1:22:18 > 1:22:23And it seemed to me that to fight to retain the office

1:22:23 > 1:22:26at that point would make it even longer,

1:22:26 > 1:22:31uglier and more painful than to take the alternate path.

1:22:31 > 1:22:32So I resigned.

1:22:32 > 1:22:37From those to whom much is given, much is expected.

1:22:37 > 1:22:39I have been given much.

1:22:39 > 1:22:41The love of my family,

1:22:41 > 1:22:43the faith and trust of the people of New York,

1:22:43 > 1:22:45and the chance to lead the state.

1:22:45 > 1:22:49# You never know how much I love you

1:22:49 > 1:22:53# Never know how much I care... #

1:22:53 > 1:22:56I'm not the most politically correct person in the world,

1:22:56 > 1:22:59and I saw Eliot later after this whole thing.

1:22:59 > 1:23:02And I said, "You know, you could have run in France on this and won."

1:23:02 > 1:23:03HE LAUGHS

1:23:03 > 1:23:06# ..Fever when you hold me tight

1:23:06 > 1:23:10# Fever In the morning... #

1:23:10 > 1:23:13Eliot Spitzer's a joke. A national joke.

1:23:13 > 1:23:17He is like the poster boy of a man out of control.

1:23:17 > 1:23:20But these other guys aren't.

1:23:20 > 1:23:22These other politicians aren't.

1:23:22 > 1:23:26Bill Clinton is one of the most popular figures in American politics

1:23:26 > 1:23:28and he got a blow job in the Oval Office.

1:23:28 > 1:23:32I hope, when history looks back at that, they say, "Gee.

1:23:32 > 1:23:34"Changed the way Wall Street operates.

1:23:34 > 1:23:37"Went after environmental abuses.

1:23:37 > 1:23:40"Went after the insurance company fraud. Went after this."

1:23:40 > 1:23:44And then, on this side, "Had sex in a Washington hotel room."

1:23:55 > 1:23:59He resigned 13 months ago and has remained largely silent until now.

1:23:59 > 1:24:00With the US economy in turmoil,

1:24:00 > 1:24:03the man once known as the Sheriff of Wall Street is back.

1:24:03 > 1:24:06- Governor Spitzer, good morning. It's good to see you.- Good morning.

1:24:06 > 1:24:08I've heard rumours that he's trying to figure a way

1:24:08 > 1:24:10to get back into public life.

1:24:10 > 1:24:13I mean, the guy's got skin like that, OK?

1:24:13 > 1:24:14I mean, that thick.

1:24:14 > 1:24:15After his resignation,

1:24:15 > 1:24:19Spitzer watched as his Wall Street reforms were attacked

1:24:19 > 1:24:22and rolled back by investment banks and the federal government.

1:24:22 > 1:24:25He had been on to the very issues that almost did us in,

1:24:25 > 1:24:27the collapse of the financial system.

1:24:27 > 1:24:30These were the guys that got us to the brink of disaster.

1:24:30 > 1:24:33And Eliot Spitzer was after them years before the collapse occurred.

1:24:33 > 1:24:35Goldman Sachs will have a profit

1:24:35 > 1:24:38that we estimate of about 12 billion last year.

1:24:38 > 1:24:42That is precisely what taxpayers gave them to help them

1:24:42 > 1:24:44get bailed out from their AIG exposure.

1:24:44 > 1:24:48Banks should be lending to people who have a repayment schedule, who produce something.

1:24:48 > 1:24:50It should be an old-fashioned, boring business.

1:24:50 > 1:24:51And then you grow an economy.

1:24:51 > 1:24:54The outrage is because it is Our money that is subsidising

1:24:54 > 1:24:55these crazy bonuses.

1:24:55 > 1:25:00As Spitzer began reappearing in public, so did Ashley Dupre.

1:25:00 > 1:25:01With uncanny timing,

1:25:01 > 1:25:05it seemed that Ashley appeared on Fox TV or the cover of the conservative

1:25:05 > 1:25:09New York Post whenever Spitzer made public appearances.

1:25:09 > 1:25:11Hi, I'm Ashley Dupre.

1:25:11 > 1:25:13I used to be on the front page of the New York Post.

1:25:13 > 1:25:14Now, I'm writing for it.

1:25:14 > 1:25:18That's right, I'm the New York Post's new advice columnist.

1:25:18 > 1:25:21Ask me anything about love, sex and relationships.

1:25:23 > 1:25:26A lot of people around the country are discussing Eliot Spitzer's

1:25:26 > 1:25:29efforts to rehabilitate himself.

1:25:29 > 1:25:32Senator Joe Bruno, of the great Capital District.

1:25:32 > 1:25:34Good morning, Senator. Thank you for being with us.

1:25:34 > 1:25:36- I think he needs therapy.- I agree.

1:25:36 > 1:25:39They ought to help him to get himself rehabbed...

1:25:39 > 1:25:41- Assuming he can.- ..because people like this are very dangerous.

1:25:41 > 1:25:45What do you think about an Eliot Spitzer comeback?

1:25:45 > 1:25:48Look, I can't forecast it. I hope not.

1:25:48 > 1:25:51I hope what he did...

1:25:51 > 1:25:54- You think it was simply...- Yeah, he thought he was above the law.

1:25:54 > 1:25:56The law didn't apply to him.

1:25:59 > 1:26:02What do you think is next for Governor Spitzer?

1:26:02 > 1:26:06You know, we all have our own private hells.

1:26:06 > 1:26:09I hope his private hell is hotter than anybody else's.

1:26:11 > 1:26:15Ken Langone and Hank Greenberg are powerful enemies.

1:26:15 > 1:26:19Did it ever concern you that they might have played a role in your downfall?

1:26:21 > 1:26:27I guess it didn't concern me enough. Look, not to...

1:26:27 > 1:26:30sort of mince words,

1:26:30 > 1:26:33there are all sorts of rumours about

1:26:33 > 1:26:38their helping, or taking credit, occasionally, for bringing me down.

1:26:40 > 1:26:44My view is, I brought myself down,

1:26:44 > 1:26:48and I will not try to blame others

1:26:48 > 1:26:50or excuse my behaviour.

1:26:50 > 1:26:53I did what I did, and shame on me.

1:26:53 > 1:26:58If they were involved in unearthing it, OK, so be it.

1:26:58 > 1:27:01That isn't my concern right now.

1:27:01 > 1:27:06What I did in our investigations of the companies,

1:27:06 > 1:27:09obviously, I believe was right.

1:27:09 > 1:27:12My personal behaviour that led to where I am right now

1:27:12 > 1:27:13was obviously wrong.

1:27:13 > 1:27:16Violative of everything I hope I believe in.

1:27:16 > 1:27:18And I make no excuses.

1:27:18 > 1:27:22# Yeah! New York, stand up!

1:27:22 > 1:27:27# Start spreading the news I'm leaving today

1:27:27 > 1:27:30# I wanna be a part of it New York, New York... #

1:27:30 > 1:27:32I opened up the 1040 today.

1:27:32 > 1:27:35There was a huge panic about inflation and Arabs wanting to be

1:27:35 > 1:27:38paid for their oil in a currency other than US.

1:27:38 > 1:27:40But I think that's just a temporary rumour.

1:27:40 > 1:27:43But it did have serious impact.

1:27:43 > 1:27:46# ..Yo, it's so deep, I woke up in the city that don't sleep

1:27:46 > 1:27:51# Got me up all night like a sink with a slow leak... #

1:27:51 > 1:27:54There are couple of people that I'd like to do that to.

1:27:54 > 1:27:56THEY LAUGH

1:27:56 > 1:27:59OK, the Governor of New York is using our service.

1:27:59 > 1:28:01How bad can what we're doing be?

1:28:01 > 1:28:02Right?

1:28:02 > 1:28:05# ..Known as where you go to become the person you want to be

1:28:05 > 1:28:07# Look, you got some small-town blues you're trying to lose?

1:28:07 > 1:28:09# We got a big city here to abuse your virtue

1:28:09 > 1:28:12# It might help you or hurt you Sink or desert you

1:28:12 > 1:28:15# Get close to bright lights might burn you

1:28:15 > 1:28:16# Start spreading the news... #

1:28:16 > 1:28:19Virtually worthless.

1:28:19 > 1:28:21About, about a hundred...

1:28:21 > 1:28:22About 100 million.

1:28:22 > 1:28:24# ..to be a part of it New York, New York

1:28:24 > 1:28:25# New York, New York

1:28:25 > 1:28:28# These vagabond shoes These vagabond shoes

1:28:28 > 1:28:31# They say if you can make it here You can make it anywhere

1:28:31 > 1:28:33# Right to the very heart of it New York, New York

1:28:33 > 1:28:36# I'm trying to be the new King of the Hill, fear me

1:28:36 > 1:28:38# New York, big city of dreams

1:28:38 > 1:28:39# And big schemes

1:28:39 > 1:28:41# Petty hustlers on the corner

1:28:41 > 1:28:42# Claim they doing big things

1:28:42 > 1:28:44# Winning battles, never wars

1:28:44 > 1:28:45# Doing dirt like chores

1:28:45 > 1:28:46# Never know who's telling lies

1:28:46 > 1:28:48# But the city keeps score... #

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1:28:51 > 1:28:54E-mail subtitling@bbc.co.uk