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Viscount Linley, son of the late Princess Margaret, has been named as the royal at the centre of a sex and drug extortion scandal in Britain.
The 45-year-old, who couldn't be named in Britain because of court restrictions, was outed on US television.
Two Britons, Ian Strachan, 30, and Sean McCuigan, 40, are being held in two London jails on charges of attempting to extort over $120,000 from the Queen's nephew.
The men allegedly claimed they had a video of a royal aide performing oral sex on the royal.
Britain's Sunday Times said the men also claimed the footage showed the royal aide snorting cocaine from an envelope allegedly supplied by the royal.
Strachan, from the London suburb of Chelsea, is a property developer and socialite originally from Aberdeen in Scotland.
McGuigan, 40, lives in nearby Battersea. His occupation was not revealed.
The duo are set to apply for bail later this week with a court appearance in the Old Bailey scheduled for December.
The scam was exposed when a detective, posing as a royal aide, met the two men in a London hotel on September 11 and was shown the video.
The men were arrested immediately afterwards, the Sunday Times said.
Buckingham Palace has declined to comment other than to say it was a police matter.
It's the first time a member of the royal family has been blackmailed in more than a century.
- REUTERS / NZ HERALD STAFF