Yes, they can of course. However, if I were you, I would first get a defense attorney on board who may be able to do damage control - or get you some immunity in exchange for being a witness against a bigger perp committing a far worse crime (that of extortion). In addition, if properly handled, it may be that you need not even confess to paying her - please the 5th, so to speak! She could be threatening to tell people you paid a prostitute, when it wasn't even true, because you committing that crime is not a prerequisite to her committing extortion and threatening to falsel tell people you did. Granted, it will look suspicious, but I don't think the big priority is nailing John's over extortionists. And again, speak to your defense attorney about reporting her while NOT making any admissions as to guilt of the other crime.
Good luck here, I'd teach this lady a quick and sharp lesson here.
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