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Royal Foot-In-Mouth Disease

There's a new royal scandal for a member of Britain's Royal Family, reports CBS News Correspondent Sam Litzinger.

Prince Edward's wife, Sophie Rhys-Jones, allegedly made some indiscreet comments to a tabloid journalist who posed as an Arab sheikh and potential client, and they've cost the Countess her job — not as a member of the royal family, but as chief executive officer of her public relations firm.

CBS News Correspondent Richard Roth reports it was all caught on tape.

"It was an extraordinarily wide ranging and enormously indiscreet account coming from Sophie," said News of the World managing editor Stuart Kuttner.

But the 36-year-old wife of Prince Edward said she wanted to continue to have a professional career. Buckingham Palace said it supported that aspiration, but would look into ways to avoid conflict of interest if members of the royal family choose to pursue outside business interests.

Britain's tabloids haven't had this much fun in ages, since Princess Diana died and Duchess of Windsor Sarah Ferguson was kicked out of the Royal Family.

The Sophie affair has mesmerized Britons since April 1, when it emerged that the countess had been caught in a sting by a tabloid journalist posing as a prospective client.

Britain's tabloids are having a field day.

Various versions of what was said have been printed in the tabloids, but from all accounts it was clear that the conversation took an indiscreet turn, with Sophie — the newest member of the royal family — commenting freely on the policies of Prime Minister Tony Blair, the love life of Prince Charles, heir to the throne, and other no-go topics.

In Sunday's statement, Sophie expressed regret over "any embarrassment, above all to the queen."

"I am deeply distressed by the carrying out of an entrapment operation on me and my business, but I also much regret my own misjudgment in succumbing to that subterfuge," she said, adding that she would step aside as chairman of her public-relations firm, R-JH.

Also stepping down was Sophie's partner Murray Harkin, who was captured on the tabloid's tape talking about drug use and offering to arrange gay parties and sex tourism for clients. The countess said the firm would be restructured.

Roth reports that isn't likely to end "Sophiegate" soon. Word is, the newspaper's ready to release its secretly-recorded videotapes

Sophie's mother-in-law, the queen, took a surprisingly understanding tone over the affair — at least in public.

"Her Majesty accepts hat despite the difficulties of recent days, both the earl (Prince Edward) and countess understandably want to try to pursue working careers, and they have her full support in doing so," the palace said in a statement. "It is not an easy option, and they are breaking new ground, but it is right in this day and age that they should be allowed to do so."

The contretemps began when the News of the World tabloid sent a reporter disguised as a wealthy sheik to discuss a fictional business deal with the countess.

The transcript — published in the paper's Sunday edition, after the tabloid reneged on an earlier agreement to quash it in exchange for an interview with Sophie — said the countess suggested that Queen Mother Elizabeth stands in the way of Prince Charles marrying his longtime love Camilla Parker Bowles.

So long as the 100-year-old royal matriarch lives, "it's very hard for anybody to publicly recognize Camilla," Sophie said, according to the transcript.

She also reportedly opined that Blair is ignorant of life in rural Britain — currently being ravaged by the outbreak of foot-and-mouth disease — and that Blair's wife Cherie is "even worse, she hates the countryside."

The transcript said the countess complimented Conservative Party leader William Hague for his intelligence, but not his speaking style — "He sounds like a puppet, unfortunately."

Earlier, the Mail on Sunday — the News of the World's top tabloid rival — got hold of at least part of the tapes' contents. The Mail on Sunday would not say where it got them, but suggested they were leaked.

The latest transcript, in the News of the World, appeared to clear Sophie of having made some of the more inflammatory remarks reported April 1 in the Mail on Sunday.

According to the transcript, she did not describe the prime minister's wife as "horrid, horrid, horrid," as the earlier reports had had it. Nor did she say Hague looks "deformed," or refer to the queen as "the old dear," as had been claimed.

But what eventually emerged was still enough to scandalize royal-watchers.

The palace said some of the details in The Mail on Sunday were inaccurate, but let it be known that the countess had written letters of apology to her royal in-laws and to the Blairs.

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