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MSNBCSpitzer's secrets began to unravel last year when banks tipped Internal Revenue Service agents to something strange going on with his accounts, authorities said. His money transfers were setting off all sorts of red flags.
The case was referred last fall to federal prosecutors, who came to believe that Spitzer may have spent tens of thousands of dollars transferring money between accounts to pay for prostitutes, according to a law enforcement official who spoke on condition of anonymity because of the sensitivity of the case.
The first public hint of Spitzer's downfall was dropped in a federal court in Manhattan on March 6. Four people were charged with running a prostitution and money-laundering ring called Emperors Club VIP.
It was clear this was more than a run-of-the-mill prostitution bust. The prosecutors assigned to the case were headed by the U.S. attorney's public corruption unit, which generally looks at cases involving elected officials. None of the prostitution ring's clients was named, but the 47-page document detailed dealings with 10 of them — identified only as Clients 1 through 10.
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New York State Gov. Eliot Spitzer makes a statement to reporters during a news conference in this Monday, March 10, 2008, file photo in New York where he apologized to his family and the public after a report that he was involved in a prostitution ring.