Eliot Spitzer Doesn't Need Vanity Fair's Help (But He's Getting It Anyway)
The idea that Eliot Spitzer's downfall was engineered by the financial industry whose profits he threatened with regulation has made the rounds on the internet for a while. Now Vanity Fair is siccing two investigative reporters on the story.
Gawker has learned that Vanity Fair's Craig Unger and John Connolly are currently looking into the prospect that the banking and financial interests that Spitzer took on during his tenures as attorney general and governor of New York tipped off the feds to Spitzer's proclivities and launched the investigation.
While we'd love to see Spitzer emerge tormenter-in-chief for Goldman Sachs, this is not good news for his ongoing rehabilitation. First off, it casts his burgeoning anti-Wall Street crusade in a different light. Is his anti-bailout populism a function of his experience as the Sheriff of Wall Street, or of his desire for revenge against that bastards that brought him low?
Second, it only reminds people that Spitzer is a hooker-banging ex-governor. And no matter how the investigation got started, Spitzer's culpability on that count isn't in doubt. But if it is true that representatives of the Wall Street interests Spitzer tangled with handed the case to the Department of Justice, then the case takes on quite a different hue: A prominent Democrat's political enemies handed damaging intelligence to a Department of Justice that happened to be serving under a Republican president during a presidential campaign, and the FBI turned it into a prosecution for a crime that federal law enforcement agencies usually don't get involved in.
So far, no one knows precisely how the FBI came across a little operation called The Emperor's Club VIP, which was supplying high-end prostitutes to Spitzer and other bigwigs from New York to D.C. to London and beyond. According to the criminal complaint [pdf] against the prostitution ring's proprietor—the complaint in which Spitzer famously made a cameo as "Client-9"—the case began in October 2007 as a joint investigation between the FBI and the IRS. But what, exactly, the FBI was doing looking into prostitution, a crime usually handled at the local level, isn't clear. And
The New York Times is also interested in how the Emperor's Club crossed the FBI's radar—the paper has filed a request in federal court to compel the Department of Justice to release its applications for wiretap warrants in the case, which have so far remained under seal. The application, and other sealed documents the Times has been trying to lay hands on, might shed light on how the investigation got started, and the Times has argued that it wants to see the documents because "because the public has a legitimate and understandable interest in reviewing and monitoring the decisions made by the Government in determining to pursue this case, which involved at least one high-level public figure, and then to not seek charges against any clients." A federal judge sided with the paper in February and the government appealed; the case went to the Second Circuit Court of Appeals last month and a decision could come at any moment.