USAID Chief Resigns Over "D.C. Madam" Link

Randall Tobias, head of the Bush administration's foreign aid programs, abruptly resigned Friday after his name surfaced in an investigation into a high-priced call-girl ring, said two people in a position to know the circumstances of his departure.

It was Tobias' own decision to resign, according to one of the people, who said the issue came up only in the past day or so. The people spoke to The Associated Press on condition of anonymity because the investigation is still under way.

Tobias submitted his resignation a day after he was interviewed by ABC News for an upcoming program about an alleged prostitution service run by the so-called D.C. Madam.

ABC reported on its Web site late Friday that Tobias confirmed that he had called the Pamela Martin and Associates escort service to have women come to his condo and give him massages. More recently, Tobias told the network, he has been using a service with Central American women.

Tobias, 65, who is married, told ABC News there had been "no sex" during the women's visits to his condo. His name was on a list of clients given to ABC by Deborah Jeane Palfrey, who owns the escort service and has been charged with running a prostitution ring in the nation's capital.

U.S. officials would not confirm the information. A message left on Tobias' voice mail seeking comment was not returned.

Friday evening, the State Department put out a statement announcing Tobias' resignation, saying he "informed Secretary of State Condoleezza Rice today that he must step down as Director of U.S. Foreign Assistance and U.S. Agency for International Development Administrator effective immediately."

"He is returning to private life for personal reasons," the statement said.

Tobias held two titles: director of U.S. foreign assistance and administrator for the U.S. Agency for International Development. His rank was equivalent to deputy secretary of state.

Rice named Tobias to head the two programs in January 2006, and on Wednesday was at the White House, where President Bush praised his efforts coordinating global AIDS relief. Tobias had been the White House's coordinator for global AIDS relief before taking the USAID post.

On Wednesday, Tobias attended a luncheon at the State Department with Undersecretary of State Karen Hughes and actress Angelina Jolie, who was in Washington pushing for more U.S. education aid for developing countries.

Before joining the administration, Tobias was a director and chairman of Eli Lilly and Co., the Indianapolis-based pharmaceutical company.

"The lives saved and made better around the globe by Randy's work at the State Department constitute a rich legacy on which he can look back with justifiable pride," department spokesman Sean McCormack said Friday.

Tobias was the second public figure identified as a customer of Palfrey's service. Palfrey recently made good on her threat to identify high-profile clients, listing in court documents a military strategist known for his "shock and awe" combat theories.

Palfrey, 50, was indicted in March by a federal grand jury on charges of running the alleged call-girl ring from her home in Vallejo, Calif. She has denied the escort service engaged in prostitution.

Palfrey claimed she has 46 pounds of phone records involving clients. Efforts to reach her late Friday were unsuccessful. Montgomery Blair Sibley, an attorney who represents Palfrey in non-criminal cases, declined to comment.

In court records, prosecutors estimate that her business, Pamela Martin and Associates, generated more than $2 million in revenue over 13 years, with more than 130 women employed at various times to serve thousands of clients at $200 to $300 a session.

Palfrey had threatened to sell phone records that would identify 10,000 clients to pay for her criminal defense, but a federal judge ordered her not to release them. Palfrey, however, gave them to ABC News before the order took effect.

Prosecutors have accused Palfrey of trying to intimidate potential witnesses by exposing them publicly.