AP: Congressional Committee Investigates Spitzer Case

Congressional Committee Investigates Spitzer Case
The Associated Press by Devlin Barrett - December 1, 2008

A congressional committee is investigating the circumstances that led to the sex scandal causing the downfall of New York Gov. Eliot Spitzer and whether the case was politically motivated. The House Financial Services Committee is seeking to determine whether federal agents misused their expanded powers under the Patriot Act. "We have no concern about Eliot Spitzer. That is not what this is about," Steve Adamske, spokesman for committee Chairman and Massachusetts Democrat Barney Frank, said Tuesday. Spitzer resigned as governor after a February rendezvous with a prostitute at a Washington hotel came to light as part of an investigation by the Internal Revenue Service and other law enforcement agencies. Spitzer was in Washington at the time, ostensibly to testify before part of the Financial Services panel. Now, that committee demands to know how and why the Democratic governor popped up on the radar of criminal investigators. Officials have said a number of unusual money transfers by the governor triggered a "suspicious activity report" within the banking system. Eventually, that report led to a full-blown criminal investigation of Spitzer.

The congressional committee seeks details of the case to the extent that it shows how effective the suspicious activity reports have been in catching terrorists and their financiers, Adamske said. And he said the panel would like to know exactly how the Spitzer case started. "It is a concern that we have that (the law) could be used for political reasons," Adamske said. Several committee members wrote a letter to financial authorities in July seeking specific answers on the Spitzer case, The New York Times reported Tuesday. Spitzer, a married father of three, met a prostitute the day after Valentine's Day in the Mayflower hotel and resigned a month later, ending a promising political career. The committee hopes to hold a hearing next year on what led to the case, though much of its schedule is up in the air, given the uncertainty surrounding the nation's financial crisis and what sort of stimulus efforts the new Congress will try to make as soon as they arrive in January. It could also be a political problem for lawmakers to spend time examining the details of a disgraced politician rather than focusing all their attention on the nation's economic health.

Meanwhile Tuesday, a woman who helped arrange trysts for the escort service that provided Spitzer's prostitute was sentenced to a year of probation for her part in the scandal. Tanya Robin Hollander of Rhinebeck, N.Y., had pleaded guilty on Aug. 25 to a prostitution conspiracy and could have faced up to a year in prison. But Judge Deborah A. Batts took a more lenient view, saying Hollander played a less substantial role than the government had asserted. The judge also factored in a Nov. 6 decision by federal prosecutors not to charge Spitzer. "We are extremely pleased with the judge's view of this case and the sentence she imposed," Hollander lawyer Michael Farkas said. "The judge's view of this case was much more consistent with reality than the government's." Hollander is the first defendant to be sentenced in the case of the Emperors Club VIP, a prostitution ring that arranged sexual encounters for wealthy men around the world for prices as high as $5,500 an hour. The 36-year-old Hollander served as a booking agent, meaning she took phone calls from clients looking for sex and hooked them up with the ring's network of prostitutes. Associated Press writer Adam Goldman in New York contributed to this report.