The Pink Panther

As a child in Lugash, Princess Dala receives a gift from her father, the Maharajah: the "Pink Panther," the largest diamond in the world. This huge pink gem has an unusual flaw: looking deeply into the stone, one perceives a tiny discoloration resembling a leaping panther. 20 years later, Dala has been forced into exile following her father's death and the subsequent military takeover of her country. The new government declares her precious diamond the property of the people and petitions the World Court to determine ownership. Dala, however, refuses to relinquish it.
Dala (Claudia Cardinale) goes on holiday at an exclusive ski resort in Cortina d'Ampezzo. Also staying there is English playboy Sir Charles Lytton (David Niven)âwho leads a secret life as a jewel thief called "The Phantom"âand has his eyes on the Pink Panther. His charming American nephew George (Robert Wagner) arrives at the resort unexpectedly. George is really a playboy drowning in gambling debts, but poses as a recent college graduate about to enter the Peace Corps so his uncle continues to support his lavish lifestyle.
On the Phantom's trail is French police detective, Inspector Jacques Clouseau (Peter Sellers). The Inspector doesn't realize his wife Simone (Capucine) is the paramour of Sir Charles and acts as a fence for the Phantom. Meanwhile, Simone dodges her amorous husband while trying to avoid her lover's playboy nephew who has decided to make the seductive older woman his latest conquest. Sir Charles has grown enamored of Dala and is ambivalent about carrying out the heist. The night before their departure, George accidentally learns of his uncle's criminal activities.
During a costume party at Dala's villa in Rome, Sir Charles and his nephew separately attempt to steal the diamond, only to find the jewel already missing from the safe. The Inspector discovers both men at the crime scene. They escape during the confusion of the evening's climactic fireworks display. A frantic car chase through the streets of Rome ensues. Sir Charles and George are both arrested after all the vehicles collide with one another in the town square.
Later, Simone informs Dala that Sir Charles wished to call off the theft and asks her to help in his defense. Dala then reveals that it was she herself who stole the diamond to avoid turning it over to the new government of her homeland after the World Court ruled in their favor. However, the Princess is also smitten with Sir Charles and has a plan to save him from prison. At the trial, the defense calls as their sole witness a surprised Inspector Clouseau. The barrister (John Le Mesurier) asks a series of questions that suggest Clouseau himself could be The Phantom. An unnerved Clouseau pulls out his handkerchief to wipe the perspiration from his brow, and the jewel drops from it. Great commotion follows while the Inspector faints.
As Clouseau is taken away to prison, he is mobbed by a throng of enamored women. Watching from a distance, Simone expresses regret, but Sir Charles reassures her that when the Phantom strikes again, Clouseau will be exonerated. Sir Charles invites George to join them on the Phantom's next heist in South America. Meanwhile, on the way to prison, the Roman police express their envy that Clouseau is now desired by so many women. They ask him with obvious admiration how he committed all of those crimes, Clouseau considers his newfound fame and replies, "Well, you know . . . it wasn't easy." The film ends with the cartoon Pink Panther as a traffic warden run over by the police car escorting Clouseau to prison. He gets back up, holding a 'The End' title card.

Question: Who was Watching From a Distance?
Answer: Simone