Footage of Justin Bieber telling a racist joke was made public after he refused to pay $1 million to the person who had obtained it, it has been claimed.
The singer was held to ransom over the clip, TMZ.com reported, by a man who had copied it from a computer hard drive belonging to the singer.
Sources told the website the 20-year-old's reps were contacted two months ago by a lawyer, who represented a client who had worked on the star's videos.
The lawyer said he'd sell the video to the media unless Bieber forked out $1 million, which was quickly refused, TMZ reported.
The price was allegedly later dropped to $800,000 and then $500,000.
But the seller was "sent packing" by Bieber's representatives as they felt the video of him telling a racist joke "was not that harmful" because he was only 15 when it was recorded.
The news emerged on the same day the hitmaker was spotted boarding a private jet after a brief stay stay at a swanky villa in Mexico.
Bieber was first plunged into the racism row this week after the clip emerged of him allegedly changing the lyrics of a song to joke about killing a "n*****" and joining the Ku Klux Klan.
The popstar was reportedly caught on camera changing the lyrics of his song One Less Lonely Girl to sing "one less lonely n*****" - and joking about joining the white supremacist group.
He then apologised "for offending or hurting anyone with my childish and inexcusable behaviour". But on Monday a second clip was revealed of him using the n-word five times.
The Sun claimed the fresh clip showed the Canadian singer, wearing a dog tag and a dark blue shirt, changing the words to his 2009 song.
A source told the newspaper: "Unfortunately this is the devastating reality of how Justin has behaved and reveals his attitude toward such a deeply emotive subject."
On Monday, the Mail reported how Bieber faced a backlash from his fans over the footage.
It is believed that both clips dating back to 2009 are from the same video. They will be seen as likely to prove particularly damaging to his career because of the help he has received from African-American artists.
The Canadian star is signed to RBMG Records, the label owned by black singer-songwriter Usher Raymond, while he has performed with a string of black singers and rappers including Will.i.am, Nicki Minaj and Lil Wayne.
Bieber apologised for the clip this week, saying that when he was a child he did not realise how certain words could hurt, adding that he had learned from his mistakes.
He said: "As a kid, I didn't understand the power of certain words and how they can hurt. I thought it was okay to repeat hurtful words and jokes, but didn't realise at the time that it wasn't funny and that in fact my actions were continuing the ignorance.
"Thanks to friends and family I learned from my mistakes and grew up and apologised for those wrongs. Now that these mistakes from the past have become public I need to apologise again to all those I have offended. I'm very sorry.
"I take my friendships with people of all cultures very seriously and I apologise for offending or hurting anyone with my childish and inexcusable mistake. I was a kid then and I am a man now who knows my responsibility to the world and to not make that mistake again.
"Ignorance has no place in our society and I hope the sharing of my faults can prevent others from making the same mistake in the future. I thought long and hard about what I wanted to say but telling the truth is always what's right.
"Five years ago I made a reckless and immature mistake and I'm grateful to those close to me who helped me learn those lessons as a young man. Once again, I'm sorry.'
- Daily Mail