Sex scandal passes but Spitzer may face legal woes

By Ellen Wulfhorst

NEW YORK (Reuters) - Resigning over reports he paid for a $1,000-an-hour prostitute, New York Gov. Eliot Spitzer leaves behind his political post but could face legal trouble from the stunning sex scandal.

Spitzer, who fought malfeasance on Wall Street with publicity-conscious vigor, fell from grace after The New York Times reported this week that his conversations to arrange for an expensive call girl in a Washington hotel were caught on a federal wiretap.

"The remorse I feel will always be with me," a grim-faced Spitzer, 48, said as he resigned on Wednesday with his wife by his side.

Indeed, his legal worries are likely far from over.

Spitzer, who came into office in 2007 promising to clean up state politics, faces the possibility of federal criminal charges over how he may have paid for prostitution services, specifically charges of structuring, which entail payments made so as to conceal their purpose and source.

Another violation may involve money laundering, if payments made to the suspected prostitution ring's shell corporations are found to be part of a larger conspiracy, legal experts said.

Legal observers speculated Spitzer was seeking to reach a deal to avoid or reduce any criminal liability before he left office. On Wednesday, the top federal prosecutor in New York said there was no such deal.

Prostitution is illegal in most U.S. states, but clients are rarely prosecuted and he is unlikely to face such charges.