Below The Beltway

Or at least the male half of it:

A woman accused of running a prostitution service catering to men in hotels and homes in the Washington area was indicted on federal racketeering charges yesterday in a case with a twist: She has threatened to peddle “the entire 46 pounds of detailed and itemized phone records” of her clients to raise money for her defense.

Working out of her California home, Deborah J. Palfrey, 50, did business in Washington under the name Pamela Martin and Associates. On a Web site seeking donations to her legal defense fund, the company is described as “a high-end adult fantasy firm which offered legal sexual and erotic services across the spectrum of adult sexual behavior.”

But federal authorities say it was a thriving call-girl service, begun in 1993, that dispatched college-educated women in their 20s to male clients in the Washington area who paid $275 to $300 per sexual encounter. The prostitutes kept half of the fees and mailed the rest to Palfrey in money orders, authorities allege in an affidavit filed in federal court.

The indictment says that in 13 years, the service employed 132 women and generated about $2 million in income “through prostitution related activities.

(….)

[Palfrey's attorney] said his client’s “legal escort service” was almost exclusively a cash business. He said that the women who worked for Palfrey were given 1099 tax statements each year, listing their earnings as independent contractors, and that Palfrey accurately reported her yearly income on federal tax returns prepared for her by H&R Block.

Palfrey has been warring with prosecutors since they raided her home in Vallejo, Calif., in the San Francisco Bay area, in October. Sibley said they seized about $1 million worth of real estate and $500,000 in cash and stocks and began the forfeiture proceedings.

“Ms. Palfrey adamantly disputes the government’s claims of illegal behavior,” according to her legal defense Web site, where she began seeking donations after the government took her assets.

“It is an unfortunate fact of life that funds will need to be generated to counteract the present injustice,” the Web site says. As a result, “consideration is being given” to selling Palfrey’s phone records dating to 1993, including the phone numbers of about 10,000 clients in the Washington area who used what Palfrey asserts was her legal escort service.

Palfrey sent an e-mail to prosecutors this year that warned of the disclosure. “I simply cannot emphasize to you the terrible and quite unnecessary ramifications this case (civil and/or criminal) will set off if permitted to advance,” she wrote. “The press will have a field day. . . . I can state with unequivocal certainty this situation will be a very long and unpleasant one.”

Well this could be a fun juicy scandal.