The New York Times reassigned Ali Watkins, the star reporter who was accused of being romantically involved with at least two potential sources, to a new beat outside of the paper’s Washington bureau. The paper’s top editor blasted Watkins’ actions as “unacceptable” but said she deserves a second chance.

The Times announced on Tuesday that Watkins will relocate to New York after an internal review of her romantic history with potential sources. The paper also announced she will receive a mentor and a “fresh start,” executive editor Dean Baquet told staffers.

Last month, a shocking indictment revealed that prior to joining the Times, Watkins, 26, had a three-year romantic relationship with Senate Intelligence Committee aide James A. Wolfe, 58, who was accused by federal prosecutors of lying about leaks of sensitive information to journalists. The indictment strongly suggested he was a source for Watkins and others, though Watkins reportedly has denied using her relationship for scoops.

The Gray Lady then published a blistering report about Watkins, its own employee, which revealed she dated another Intelligence Committee staffer. The report strongly implies Watkins rose to journalistic fame while using her married boyfriend as a source.

The Times report headlined, “How an Affair Between a Reporter and a Security Aide Has Rattled Washington Media,” and featured interviews with roughly 36 “friends and colleagues” of the scandalous former couple. Watkins carried on a three-year relationship with Wolfe, who is 30 years her senior and has been overseeing classified information delivered by the CIA and FBI since “before Watkins was born,” as the paper pointed out.

Jill Abramson, the former executive editor of the paper, blasted the paper for publishing the “horrible” deep dive into Watkins' past in an email to Daily Beast reporter Lloyd Grove.

“That story hung a 26-year-old young woman out to dry. It was unimaginable to me what the pain must be like for her,” Abramson said.

The Times’ decision was announced on the day before a holiday, when negative news is typically dumped to avoid unwarranted attention. The Times typically prides itself on being an advocate for transparency, so the timing has raised eyebrows across the media industry. Baquet sent a memo to his staff about the Watkins situation that was published by the paper on Tuesday.

"We hold our journalists and their work to the highest standards,” Baquet wrote. “We are giving Ali an opportunity to show that she can live up to them. I believe she can.”

Baquet said the Times “must be a humane place that can allow for second chances when there are mitigating circumstances.” Despite the decision not to terminate Watkins, Baquet did express displeasure with her action in the note.

“We are troubled by Ali’s conduct, particularly while she was employed by other news organizations. For a reporter to have an intimate relationship with someone he or she covers is unacceptable." — New York Times Executive Editor Dean Baquet

“We are troubled by Ali’s conduct, particularly while she was employed by other news organizations. For a reporter to have an intimate relationship with someone he or she covers is unacceptable,” he wrote.

Watkins covered national security for McClatchy, HuffPost, BuzzFeed, and Politico before joining The New York Times. She has denied receiving information from Wolfe during their relationship.

“Although her disclosures varied in detail, none of her editors barred her from covering the intelligence committee, or explicitly told her that the relationship was inappropriate,” Times media correspondent Michael M. Grynbaum wrote on Tuesday. “She has said the relationship did not turn romantic until after those stories ran.”

Watkins was a finalist for the coveted Pulitzer Prize during her time at McClatchy.

“As she started her career, I believe she was not well served by some editors elsewhere who failed to respond appropriately to her disclosures about her relationships,” Baquet wrote, adding that the Times editors “also bear some responsibility.”

He said the Times’ inquiry “found that during the hiring process she disclosed aspects of her past relationships to some editors.”

Watkins received a letter in February notifying her that the Justice Department obtained her records, but the reporter did not inform the Times until June at the advice of her lawyer, according to the paper. Baquet wrote that those actions “put our news organization in a difficult position.”

"I respect and understand the Times’ review and agree that I should have handled aspects of my past relationships and disclosures differently." — Ali Watkins

Watkins issued the following statement: “I respect and understand the Times’ review and agree that I should have handled aspects of my past relationships and disclosures differently. I sincerely regret putting The Times in a difficult position and am very grateful for the support I’ve received from my editors and colleagues here. I also appreciate the review’s conclusion that my reporting has been fact-based and accurate.”

Wolfe, who was indicted this month on three counts of lying to FBI agents and accused of leaking information to the media, pleaded not guilty in front of a federal magistrate judge in Washington, D.C., earlier this month. Watkins has not written for the Times since his arrest.

“Reporters at The Times, and at other news organizations, have expressed unease over Ms. Watkins’s conduct. Women in particular say the episode has made them more vulnerable to an ugly and false stereotype often lobbed at female reporters, that they exchange sex for information,” Grynbaum wrote.

Baquet said the vetting process at the Times will tighten as a result of the Watkins investigation.