John Edwards Denies Call Girl's Claim That He Was Client of Prostitution Ring

John Edwards is denying allegations from a call girl that he was a former client of a prostitution ring. INSIDE EDITION has the latest.

It's a bombshell new sex scandal for disgraced politician John Edwards. He's been named as a one-time client of accused madam Anna Gristina, who, along with her business associate Jaynie Mae Baker, has been accused of running a high-class prostitution ring in Manhattan.

According to the website, one of Anna Gristina's call girls told cops she had an encounter with Edwards at a New York hotel.

According to the website, Edwards' fling with the high-priced escort took place at a hotel on the Upper East Side of Manhattan. Although the hotel wasn't identified in the report, the Edwards campaign did indeed spend thousands of dollars at New York hotels during his run for the presidency, including rooms at the elegant Loews Regency on Park Avenue.

The tryst allegedly happened at the height of Edwards' campaign for the Democratic presidential nomination of 2008, according to the website's award-winning criminal justice reporter Murray Weiss. He claims one of the call girls: "told investigators she was paid to have sex" with Edwards.

Weiss told INSIDE EDITION, "The district attorney's office investigated the allegation. Of course, at the time they were surprised. Mr. Edwards was a presidential candidate coming to New York numerous times. They had no reason to doubt what she was saying about Mr. Edwards. They investigated it and they declined to bring charges against him however."

Edwards is the first big name to surface in the scandal. Both Gristina and Baker have pleaded not guilty.

But Edwards is firing back at the claim. His lawyer issued a statement saying: "Mr. Edwards categorically denies that he was involved with any prostitute or service. These allegations are false, defamatory...He has demanded a complete retraction from the only source being quoted."

The Regency Hotel was where Edwards began the affair with Rielle Hunter that would doom his political career. That affair took place while Edwards' wife Elizabeth was battling breast cancer. She succumbed to the disease in 2010.

Hunter is now raising her daughter with Edwards as a single mom in North Carolina.

Edwards' criminal trial over claims that he used campaign funds to cover up his affair with Hunter is expected to start next month.