Best Little Whorehouse On Wall Street

Can you say “double standard?”  Kristin Davis, escort service CEO (madam) who provided companionship by the hour to former governor Elliot Spitzer, and whose “little black book” is revealing the peccadilloes and services purchased to indulge them of some of the country’s biggest big ballers, surely can.   And she is indignantly proclaiming it loudly to anybody who’ll listen, like ABC News:

Wall street lawyers, investment bankers, CEOs and media executives often used corporate credit cards to pay for $2,000 an hour prostitutes, according to the madam who ran one of New York’s biggest and most expensive escort services until it was busted last year.

But prosecutors in the Manhattan District Attorney’s office chose not to pursue any of the corporate titans, says Kristin Davis, who pleaded guilty last year to charges of running a prostitution business that used more than a hundred women.

“Used?”  Not “employed?”  There is a difference, ya know.  Whatever one thinks of the morality of the profession, there’s not a lot of difference between a madam and a CEO, or a call girl and a consultant.  Which is pretty much Davis’ point.  Either it’s a crime to indulge in prostitution, or it isn’t.  Can’t sell what nobody will buy, after all.

However, the larger point is that these poor, misunderstood, stressed out titans of industry were getting their ashes hauled using corporate credit cards that were billed for services such as “computer consulting” and “roof repair.”  Which is fraud:

Davis says one CEO ordered her to send him invoices for “roof repair on a warehouse” to disguise the payment for prostitutes from corporate funds.

“That is fraud,” said former New York prosecutor Sid Baumgarten, who told 20/20 the district attorney should have investigated the men.

“Not necessarily just for the patronizing but for the use of these business records and credit cards to see what kind of fraud or tax fraud was being used. And if so, that is a major offense,” Baumgarten said.

When ABC News contacted that CEO, he said he used his corporate card to pay for the escort service to entertain clients, but that there was no sex involved.

Davis, who can plausibly be called an entrepreneur in her own right, operated a multi-faceted organization providing a variety of services, (I’d bet the farm sex was indeed involved in all of them) until the Fed crackdown on Elliot Spitzer took her down with him:

Davis operated her escort service as a prostitution conglomerate, with five different “brands” over a four year period, each with its own “price point” and websites.

At the high end was an escort service called Carlyle Trust, mimicking the name, but not connected in any way, to a prestigious investment firm. Davis said she recruited top fashion models who charged up to $2,000 an hour for clients of Carlyle Trust.

Her lower cost services charged $400 an hour for a “body rub,” she said.

The “best little whorehouse on Wall Street” was located just a few blocks from the New York Stock Exchange, in apartment 3A at 136 William Street.

Davis operated three other “in-call” locations in the mid-town area of Manhattan.

The escort business took in as much as $200,000 a week, Davis estimated.

This is where the story gets strange.  Davis’ reputation seems to have been trashed, then, somewhat rehabilitated since the Spitzer investigation first revealed that he used her services as well as those of Mark Brener, the proprietor of the Empire Club and employer of Ashley Dupree, the woman Spitzer allegedly violated the Mann Act with by transporting her to Washington for sheet sweating, possibly on the taxpayers’ dime.  Brener was sentenced Friday to 30 months in prison for conspiracy to commit prostitution and money laundering.  Curiously, Spitzer was never arrested or prosecuted though he was forced to resign as Governor, and the Federal investigation against him was dropped 2 days after the November national election.  Probably just a coincidence.

A March 26 New York Times article reporting Kristin Davis (not the Sex in the City actress, btw) does not mention Spitzer, and charcterized her as a “woman accused of running a large prostitution ring.”  Subsequent reports, mainstream and otherwise, began to detail Davis’ involvement with the kinky governor who developed crushes on “consultants” and whined and tried to bully them into allowing him to “ride bareback.”  Davis herself was soon being described as everything from “trailer trash” to “tranny.”  Web articles here, here, here, here, and here get increasingly bitchy.

By December of last year when she was “freed” after being sentenced to 90 days, time served, and relieved of the almost $500,000 she ws arrested with, Davis, though still referred to as a “buxom blonde,” was back on her way to relative respectability.  By January of this year, Gawker was posting her opinion of celebrities’ sex worker potential.  February 6 brought us Davis’ tell all book, though the contents of her “little black book” were hinted at as early as March of last year.  Among those contents, partially verified by ABC, were these, re-printed here from the Raw Story:

* a vice president of NBC Universal (owned by General Electric)
* the part owner of a Major League Baseball team who “loves Kelsey”
* the CEO of one of the country’s largest private equity firms who met “Cameron” at the Peninsula Hotel
* a major New York real estate developer who, according to the list, “will come to the door wearing women’s panties”
* a partner at the Wall Street law firm Cravath Swaine Moore “looking for a party girl to come fully equipped” and spent a total of $20,000
* an investment banker from Lehman Brothers who saw “Kelsey and Keely together” and later saw “Aria and Skyler at the same time”
* an investment banker at JP Morgan Securities who “loves Brooke” and spent $41,600
* an investment banker at Goldman Sachs who “only wanted all-American girls” and spent $27,000
* a managing director from Merrill Lynch who saw “Lana” using the name “Nataly”
* a managing director from Deutsche Bank “who called about seeing Nataly again”

Spitzer, whose identity as Mark Brener’s, not Kristin Davis’, Client Number 9, was leaked to the media and confirmed by a “person briefed on the case,” took a big hit to his reputation as the “Sheriff of Wall Street,” an appellation earned from his efforts as New York State Attorney General to reform the financial industry, though some say those efforts didn’t go far enough.  In light of the allegations of impropriety, and his subsequent resignation 2 days later, Wall Street took delight and unabashedly celebrated his predicament, while trashing his previous accomplishments.  Some sources even began to go so far as to dismiss Spitzers triumphs as hollow victories.

As AG, however, Spitzer’s efforts were initially welcomed by industry watchdogs.  Salon even called him “Wall Street’s Worst Nightmare.”  So, what happened?  Some speculate that the leak of his implication in the Federal investigation and possibly even the investigation itself was tantamount to a political “hit” orchestrated by forces furious with the governor’s reform efforts against companies like Merrill Lynch, Bear Stearns, Goldman Sachs and AIG, among others.

Lost in the allegations of hypocrisy leveled at Spitzer for his indulgences with prostitutes while self-righteously prosecuting prostitution rings to the fullest extent of the law, was the fact that he had set his reformer sights on industries other than pimps and money-changers.  According to Business Week, in December 2002, Spitzer served notice to the Hyde Park crowd:

Who’s to blame for expensive prescription drugs, pollution, and the biased research coming out of Wall Street? Try pinning the rap on the University of Chicago.

At least that was New York State Attorney General Eliot Spitzer’s attempted in a Dec. 4 speech to financial-services executives at the annual Banker of The Year dinner. At the banquet, which was held in New York’s Helmsley Palace, Spitzer blasted the University of Chicago for encouraging recent market excesses with a philosophical curriculum that teaches less regulation is always good for capitalism. The audience listened respectfully, but many, especially the University of Chicago alums, privately voiced their disagreement with Spitzer’s thesis later in the evening.

As a voice of laissez-faire economics, the University of Chicago has shaped much of the dialogue over market regulation in recent years, starting with Ronald Reagan’s Administration in 1980. Free markets, the theory goes, will correct most excesses by making it impossible for those guilty of bad behavior to survive. “They’ve said that intervention by…government is wrong,” Spitzer said. “But they haven’t taken into account that markets can have structural flaws.” Contacted by BusinessWeek Online for a reaction, University of Chicago professor of business and economics Kevin Murphy said Spitzer’s interpretation of the schools position was simplistic. Says Murphy: “I think we have better things to do than beat up a straw man.”

Hmmm…Bear Stearns, University of Chicago, AIG, Goldman Sachs, Merrill Lynch, Wall Street…straw man?  2002?  Didn’t Rod Blagojevich say something about prescription drugs?

I know what you’re thinking, but, nah, couldn’t be.  This is a story about prostitutes and double standards, remember?  Doesn’t have anything to do with bailouts and presidents.  Who was on Kristin Davis’ list, again?