New York governor quits over revelations that he had spent $80,000 on prostitutes

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The citizens of New York State watched in still dumbfounded awe last night as their once all-conquering governor, Eliot Spitzer, confirmed what had seemed all but inevitable since the news exploded of his illicit dalliances with high-price prostitutes: he is resigning his post and leaving politics.

Thus, in a packed press room on the East Side of Manhattan, the miserable fall from grace of a hard-driving leader, one who some saw as a potential candidate for the White House one day, was completed. He will transfer power to his lieutenant-general, David Paterson, next Monday.

"I am deeply sorry that I did not live up to what was expected of me. To every New Yorker and to all those who believed in what I tried to stand for, I deeply apologise," he said in a brief statement. He added: "The remorse I feel will always be with me... For those to whom much is given, much is expected."

Mr Spitzer, a Democrat, was doomed as soon as revelations began to spew forth on Monday about his apparently repeated assignations with call girls employed by an internet-based escort ring called Emperor's Club VIP. They included conversations between himself and the ring, caught on federal wire tap, arranging a tryst on 13 February with a "petite brunette" called Kristen in a Washington hotel.

Before the microphones, his wife, Silda, at his side, Mr Spitzer, 48, declined to take questions or directly make any reference to the scandal that has so suddenly overwhelmed him.

Americans may be accustomed to sex scandals in politics, but the disgrace of Mr Spitzer remained especially gripping because of the hypocrisy involved. A son of privilege, he built his entire career on preaching moral rectitude and, as a two-term New York attorney general, pursuing corruption and ethical wrongdoing, particular in the financial industry, earning himself the nickname the "Sheriff of Wall Street".

Hardly helping him has been the steady leak of new details about his activities from sources within the federal investigation, including claims that over many months he had splurged as much as $80,000 (£40,000) on the services of Emperor's Club and possibly other prostitution services.

He reportedly met with prostitutes on numerous trips outside New York to cities like Washington and also Dallas. On one trip, lasting four days, he allegedly had relations with prostitutes more than once.

Public fascination was inevitably drawn also to a single line in a wiretapped conversation between the club's booking agent, who was among four employees arrested last week, and Kristen, the girl in Washington, about Mr Spitzer's apparent predilection for sex acts "you might not think were safe". Sources said this was a reference to requests he made of the girls that he not have to wear a condom.

While his political career reached its full stop yesterday – or technically next Monday – multiple questions remain unanswered about the full scope of Mr Spitzer's extra-marital meanderings and what legal consequences he may yet face. Investigators were focusing less on the paid-for sex and more on what steps he may have taken to conceal the money he used.

It emerged that the Long Island-based North Fork Bank was the institution that alerted US tax inspectors last year to potentially suspicious movements of money from Mr Spitzer's accounts – a tip-off that eventually led the authorities to the Emperor's Club and to set up the wire taps that snared him.

Mr Spitzer had not last night been charged with any crimes, nor was there any official indication that he might be. Experts, however, said he could be vulnerable to prosecution under so-called "structuring" laws, where deliberately camouflaging money transfers may be illegal. The Emperor's Club had required that money Mr Spitzer paid for its services be paid into shell corporations, one called QAT International.

Investigators were looking also to see if the governor, a privately wealthy man, had ever tapped state funds in pursuit of his illicit sexual liaisons and whether state personnel, including his travelling security detail, were in any way used to facilitate or cover up those activities. Aside from the risk of prosecution, Mr Spitzer could also face disbarment in New York if any such violations were committed.