DUCHESS of York Sarah Ferguson was attending an awards ceremony in the US today collecting a gong for her charitable work as the storm raged over a newspaper sting that showed her accepting money for an introduction to her former husband.
The duchess, who flew in to Los Angeles to pick up an award for her work with underprivileged children, last night apologised for her "serious lapse in judgment" and admitted her financial situation is "under stress".
The News Of The World video showed her promising to introduce an undercover reporter posing as a wealthy businessman to Prince Andrew, who has been the UK's special representative for international trade and investment since 2001.
Shunning the red carpet teeming with waiting press, the duchess ducked through a side entrance to the star-studded awards ceremony which was organised by children's charity Variety. She arrived in LA on an American Airlines flight from Heathrow airport.
On Saturday, she and elder daughter Beatrice (21) were guests at a party for supermodel Naomi Campbell's 40th birthday on the French Riviera. In a statement, the duchess said her financial situation was "no excuse for a serious lapse in judgment" after being filmed apparently offering to sell access to her ex-husband for £500,000 (€580,000). She added: "I can confirm that the Duke of York was not aware or involved in any of the discussions that occurred."
In a video on the News Of The World website she is shown telling the reporter: "£500,000 when you can, to me, open doors."
Asked if she was referring to the prince, she said "Yeah", then shook hands with the reporter before apparently accepting a $40,000 (€31,000) cash down-payment. She was filmed apparently telling him how to transfer £500,000 to her bank account, saying: "Then that, is then like, then you open up all the channels whatever you need, whatever you want, and then that's what and then you meet Andrew and that's fine. And that's, that's when you really open up whatever you want." The duchess was filmed explaining how the prince meets "the most amazing people" in his role as special representative, but insisted he "is completely whiter than white".
In a separate statement last night, a spokesman for Buckingham Palace said the prince "categorically" denied having any knowledge of the the meeting between his ex-wife and the undercover reporter.
In one scene from the film, the duchess is shown sitting in front of a table with a large amount of cash laid out on it.
The paper said despite the prince knowing nothing about the deal, the duchess claimed to have discussed it with him, saying: "Andrew said to me, 'Tell him £500,000'.
"He knows that he's had to underwrite me up to now because I've got no money. So if you want to meet him in your business, look after me and he'll look after you ... you'll get it back tenfold."
Rumours of money troubles have dogged the duchess since her divorce in 1996 and gathered pace recently. Only last month it emerged she was facing legal action from a leading law firm over a substantial unpaid bill thought to be as much as £100,000. Last year, it was claimed her plans to celebrate her 50th birthday had been scaled down because of money concerns.
The week before her birthday it emerged the New York-based company Hartmoor LLC, set up to manage her US career in publishing, public speaking and media work, was expected to close with debts of around £600,000.
Forging a career for herself outside "the firm" -- as the British monarchy is sometimes known -- has been a difficult task, but the former royal carved out a niche for herself as a children's author and charitable activist.
In 1993 she founded Children in Crisis, an organisation which helps educate youngsters around the world, and is patron of a range of charities including the Teenage Cancer Trust.