Tobias first to fall in brewing DC sex scandal

USAID director Randall Tobias, former chairman of Eli Lilly, is the first of perhaps what will be at least a few prominent people in Washington...

USAID director Randall Tobias, former chairman of Eli Lilly, is the first of perhaps what will be at least a few prominent people in Washington to resign over a connection to California-based Pamela Martin & Associates.

That sounds like one of a million PR firms, but is actually alleged to be a high-end prostitution ring whose operator, Deborah Jeane Palfray, denies knowing that her associates were doing anything other than providing “sexual fantasy” for $275 an hour without any actual sex. ABC News reports that Tobias said he "'had some gals come over to the condo for a massage' but denied any sex was involved."

Shortly after her arrest, Palfray threatened to release phone records of her firm’s clients, then later said she had given the list to an unspecified, reputable news organization.

That organization, it turns out, is ABC News.

Thus, there could be a lot of crisis-management work for public affairs firms -- or at least in-house corporate and government communications people -- following the Saturday, May 5 broadcast of ABC's "20/20," featuring an interview with Palfray, who says she plans to call any and all of her clients to testify on her behalf.

An ABC News’ April 30 online news story by Brian Ross and Justin Rood says that people Palfray plans to call to testify at her trial could include “a Bush administration economist, the head of a conservative think tank, a prominent CEO, several lobbyists, and a handful of military officials.”

"I'm sure as heck not going to be going to federal prison for one day, let alone, four to eight years, because I'm shy about bringing in the deputy secretary of whatever," Palfrey is quoted as saying in the "20/20" interview. "I'll bring in every last one of them in if necessary," she said.

Pre-emptive crisis-management work has apparently already begun, at least judging by the Washington Post article on Saturday that said several DC law firms have called Palfrey’s lawyer to determine if their clients’ phone numbers are in Palfray’s records, and if so whether there is some way to keep them private.

The April 27 State Department press release on Tobias’ resignation says simply that Tobias “is returning to private life for personal reasons.”

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