Deborah Jeane Palfrey told The Baltimore Sun the officer charged $275 an hour for "erotic fantasy services."

Palfrey denies promoting prostitution, saying she simply provided escorts and did not know if her clients obtained sexual services. She made her telephone records public after a federal investigation was opened into her business.

The Sun said a number Palfrey identified as the naval officer's appears hundreds of times in her phone records.

"Her name is splattered throughout the records," Palfrey said. "We would not talk to each other if the girl wasn't working."

Palfrey said she would never tell clients that an escort was a military officer.

The scandal has already snared two powerful clients -- Sen. David Vitter, R-La., and Randall Tobias, who resigned as deputy secretary of state.