The Duchess of York Sarah Ferguson is "regretful" and "devastated by the situation" after she was filmed apparently offering to sell access to her ex-husband Prince Andrew for £500,000, her spokeswoman said.
The 'News of the World' video showed Sarah Ferguson promising to introduce an undercover reporter posing as a wealthy businessman to the prince, who has been the UK's special representative for international trade and investment since 2001.
Miss Ferguson added: "I can confirm that Prince Andrew -- The Duke of York -- was not aware or involved in any of the discussions that occurred."
She 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 (€576,000).
She was caught in a newspaper sting promising to introduce an undercover reporter posing as a wealthy businessman to Prince Andrew.
In what is the biggest royal scalp to be taken by the 'News of the World's' veteran investigations editor Mazher Mahmood, Miss Ferguson is shown shaking hands last Tuesday on an alleged £500,000 agreement after claiming she could "open doors" by fixing meetings with the prince, facilitating "friendship talk", and ultimately helping win lucrative business deals.
"That opens up everything you would ever wish for," she told the reporter.
"And I can open any door you want. And I will."
The newspaper also alleged it had details of "two tycoons" she claimed to have already introduced to Prince Andrew, appointed unpaid UK Special Representative for Trade and Investment in 2001 after he retired from the Royal Navy.
Neither Buckingham Palace nor the UK Department for Business Innovation and Skills, which funds some of the prince's trips, would comment on the allegations.
After divorcing Prince Andrew in 1996 after their six-year marriage, Miss Ferguson spent four years paying off debts reported to have amounted to several million pounds, and building a career in the US.
But last month there were fresh claims that she was back in the red after the collapse of her public-speaking and media business last year. She said she had been left with no money after accepting a £15,000-a-year (€17,300) divorce settlement so she could remain on good terms with the queen.
Throughout the film of the conversations, in an exclusive hotel in New York, a Belgravia restaurant and a nearby London flat, Miss Ferguson stresses that her former husband is "whiter than white". There is no suggestion of wrongdoing on behalf of Prince Andrew or that he knew of her activities.
She falsely claims she had spoken to the prince about the plan, telling the reporter: "He knows that he 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."
She is shown explaining how Prince Andrew cannot work because he is the "Prince of England" but that he meets the "most amazing people".
Miss Ferguson appears animated as she makes a series of unfounded claims including that Prince Andrew had suggested the introduction fee.
But the most damaging image will be of the former princess making a silent "gimme" motion before accompanying the undercover reporter to a room where she watches as he produces wads of bank notes which he places in a black computer bag.