The alleged madam, 32-year-old Kristen Davis, was arrested at her home Tuesday.
She's accused of renting out apartments for paid sexual encounters, located at 233 East 53rd Street, 533 Third Avenue and 136 Williams Street in Lower Manhattan. Authorities say she also maintained four provocative Web sites.
Davis was arraigned Wednesday afternoon. Her attorney says her arrest is merely the end result of rumors following Eliot Spitzer's fall from grace.
She was charged with money laundering and promoting prostitution. Her attorney, Mark Jay Heller, defended her outside the courthouse.
"My client indicated that there were rumors that she was, in fact, Eliot Spitzer's Madame Butterfly and that it was rumored that she had the largest black book in America," Heller said. "And she believes that, as a result of those rumors about client 9, that she was arrested."
Heller says Davis earned a legitimate income working in the financial world, in the back offices of hedge funds. He said she has a college degree, has earned 30 credits towards a Master's Degree in psychology and pays her taxes.
"A lot of these people are desperate to make deals and exonerate themselves," Heller said. "This possibly led to my client's arrest."
In front of the apartment building where Davis allegedly set up her call girls' trysts, some who pass by daily say they had suspicions.
"That would probably explain why there were a lot of sketchy characters around here," a man said. "We were always wondering why."
"It seems to be a lot of that going around," Queens resident Jan Pandey said. "I don't think that's right thing in a residential building."
Police say Davis lives in a luxury high-rise on East 40th Street.
