Rome, 5 Nov. (AKI) - Rome prosecutors were on Thursday reportedly investigating whether disgraced local governor Piero Marrazzo used public funds to pay for his encounters with transsexual prostitutes. Media reports said they were also looking into whether funds were used to pay four Italian police officers who were allegedly blackmailing him to keep secret a video they shot of him during one of the alleged encounters.

Marrazzo, who was once tipped as a future leader of Italy's centre-left, tendered his resignation from his post in late October.

He stepped down as reports surfaced about another, longer and allegedly more compromising video of him and the use of cocaine.

The four police officers allegedly extorted 80,000 euros from Marrazzo over the mobile phone video allegedly filmed during a raid on a transsexual prostitute's apartment in northern Rome in July.

The video also shows a line of cocaine on a table by the bed in the apartment.

When initially questioned by prosecutors, Marrazzo said he had 5,000 euros in his wallet.

But when prosecutors quizzed him again this week, he claimed the sum was 3,000 euros.

He alleged he paid 1,000 euros to the transsexual prostitute, named in reports as 'Nathalie', and claimed police had stolen the remaining 2,000 euros.

Marrazzo has admitted to "sporadic and occasional" cocaine use but claimed that the cocaine shown in the video on the beside table had been planted there.

Police are now scrutinising Marrazzo's 742,649 euros expenses as Lazio governor - 400,000 euros this year plus 342,679 that remained from 2008.

His monthly salary was 10,500 euros - unlikely to be enough to pay his blackmailers and for his sex encounters and cocaine, according to investigators.

When questioned on Monday, Marrazzo, who is married with three children, admitted to several encounters with Nathalie as well as other transsexual prostitutes, including one named Brenda.

Brenda has told prosecutors that she shot a video at a sex and drugs party she attended with Marrazzo and fellow transsexual prostitute Michelle.

Brenda said she had destroyed the video but that Michelle - who has since moved to Paris - also had a copy.

Prosecutors reportedly have suspicions that other VIPs may have been photographed and videoed in embarrassing situations.

An Italian photo agency already tried to sell the mobile phone video of Marrazzo to 'Chi' weekly magazine for 200,000 euros.

Marrazzo said he was not aware Brenda had filmed a video or taken pictures of him, although he admitted to encounters with her.

"I took cocaine on these occasions which left me in such a confused state that I can't possibly know," he told prosecutors.

A regional councillor from the conservative People of Freedom Party, Tommaso Luzzi, on Thursday urged all Marrazzo's executive orders as governor to be annulled.

Luzzi claimed Marrazzo's drug habit "made him less than fully aware of his actions".