NY- It was 4 o’clock on Friday afternoon, March 31. In a spacious bilevel Greenwich Village loft, two men sat on wrought-iron chairs across from each other at a round glass table.

One was Jared Paul Stern, the New York Post’s Page Six reporter and magazine editor. The other was Ron Burkle, a West Coast billionaire investor who had rented the loft for the month while he was in New York City considering new acquisitions, including a $2.2 billion bid for a chain of 12 newspapers.

But this bit of newspaper business with Stern was different.

Nine days earlier, at a lengthy meeting at the same table, Stern had guaranteed he could manage coverage of Burkle by Page Six chief writer Richard Johnson and other Page Six staffers – and have false items about Burkle killed.

“It’s a little like the Mafia. A friend of mine is a friend of yours,” Stern had said, detailing how Burkle and others could get various “levels of protection” in return for favors and other consideration.

Stern had set his cash price for the one-year shakedown deal, saying, “$100,000 to get going and then you could get it to me on a month-to-month, maybe like $10,000.”

“Okay, that’s a great deal,” Burkle had replied during that March 22 meeting.

Now they were here to iron out the details: how different Page Six staffers – including Johnson – would be handled with other payments such as large “consulting” fees and other hidden arrangements.

And Burkle wanted assurances that Stern would not hit him up for more money a few months into the deal. To bolster his position, Stern explained the inner workings of the gossip column – tradeoffs of one kind and another – and Burkle agreed to wire the $100,000 to Stern’s bank account.

Unbeknownst to Stern, sitting there in a black sweater and jeans, the meetings were being videotaped under supervision of the FBI and the Manhattan U.S. attorney’s office.

At one point, during the second meeting, speaking on behalf of his fellow Page Six reporters, Stern said, “They all have gotta want to let up on you, they have gotta, you know, have reasons to be your friend. It has gotta be the right perks.”

Earlier in the month, after Stern had sent Burkle e-mails asking for a private meeting with veiled hints of a shakedown, Burkle immediately notified his head of security, a former Secret Service agent, and his attorneys.

One of the attorneys contacted a former federal prosecutor in New York City, who in turn contacted an FBI agent, which set the ball rolling. Both meetings were videotaped, Burkle with his back to the camera.

At the second meeting – on March 31 – FBI agents and an assistant U.S. attorney were listening on the second floor.

Alternately confident and stumbling, Stern detailed his proposals as he shifted around in his chair. Burkle was still throughout, listening carefully.

During the meetings, Stern said Page Six staffers play favorites – on “level one of protection,” taking care of people who give them juicy tidbits while throwing barbs at those not considered “friends of the page.”

Level two and level three protection, according to Stern, involve “perks,” contracts and deals. For his money, Burkle could purchase all “three levels,” Stern said.

At one point, Burkle said to Stern, “You always like to tell the truth?”

“Yes,” Stern replied.

At the end of the second meeting, Stern said he would e-mail Burkle with instructions on how to wire a $100,000 downpayment to Stern’s bank account.

And throughout last week, until the Daily News broke the story of Stern’s shakedown, Stern was sending e-mails to a Burkle employee, asking for his money.

William Callahan, a former federal prosecutor who viewed the tapes, said, “I would subpoena all the staff of Page Six into a grand jury and question them about taking extortion money to kill untrue stories and other favors and consideration for favorable stories.”

The shakedown and Stern’s description of the inner-workings of Page Six have rocked the world of gossip, while devastating the Post’s franchise column. The News’ revelations about the scandal have appeared on the front pages of newspapers around the nation and on television news shows as well.

Though the Post has characterized Stern as a reporter “who sometimes worked two days a week” at the paper, present and former staffers said that in fact, Stern had been at his desk in the newsroom nearly every day.

Stern is listed in the Post’s phone directory and he was at his desk when The News called him shortly before 5 p.m. on Thursday to ask about the shakedown. “Outrageous,” he said, “I’ll call you back.”

But he never did and later that night, he retained high-profile lawyer Edward Hayes.

Stern, who has been suspended by the Post, began working for Richard Johnson and Page Six about 11 years ago as a full-time reporter. Hundreds of articles and items have appeared in the Post with the Stern byline.

Stern is the editor of Page Six Magazine, writes a daily column on fashion for the Post during Fashion Week and is also the paper’s Sunday books editor. For a time, Stern had his own Post column, Nightcrawler, featuring his club-hopping adventures with his girlfriend “Snoodles.”

Stern remained secluded yesterday at his second home in Oak Hill, N.Y., about 120 miles northwest of Manhattan. He had no comment for reporters.

Burkle was back home in Los Angeles.