ABC’s Brian Ross appeared on Reliable Sources with Howard Kurtz today to talk about covering the D.C. Madam escort service story. Transcript follows…

HOWARD KURTZ, HOST: The D.C. madam has been talking to ABC News about her escort service, and a top administration official fingered as a client has already resigned. We’ll ask ABC’s Brian Ross about this breaking story.

(INAUDIBLE) not surprisingly, plenty of gossip and titillation when the woman who’s been dubbed the D.C. madam — her real name is Deborah Jeane Palfrey — who’s charged with running a high end prostitution ring here in the nation’s capital. She says lots of important people use the service and she’s been talking about this with ABC’s Brian Ross.

On Thursday, Ross spoke with Deputy Secretary of State Randall Tobias, whose phone number was in the escort service’s records. Tobias resigned late Friday and Ross, who’s working on a story for next week’s “20/20,” posted some of the details on his blog that night. ABC’s chief investigative reporter joins us now by phone from Connecticut. Brian Ross, thanks very much for calling in. Roughly, how many names are on this list and what kind of people are they?

BRIAN ROSS, ABC NEWS: There are several thousands names, tens of thousands of phone numbers and they range from administration officials to lobbyists to advisers who are well known, people who appear on television, lawyers, and then just a lot of sort of ordinary businessmen and CEOs.

KURTZ: And some women as well?

ROSS: The women who are the — the women who worked for Jean Palfrey range from university professors, legal secretaries, military officers themselves.

KURTZ: Brian, as I just mentioned, you spoke on Thursday with Randall Tobias. He was running the Agency for International Development at the State Department. What did he tell you about his involvement with the escort service? Was he agitated during this conversation?

ROSS: No, he was I would say more, Howie, he was subdued. Initially, I placed a call on the number he used to contact the escort service. His press secretary called back and I explained that I wanted to speak to Mr. Tobias directly - only if he authorized the press secretary to talk to me would I continue. And then about an hour later, Tobias himself called back. And I told him what we had seen in the records and it was his number listed to his home address in Indiana, and after about a five-second silence, he confirmed. He said he had gals come over to the condo to give him massages, that he had found the number in the “Washingtonian” magazine and recently he been using some what he called central American gals to give him massages.

KURTZ: So Tobias is saying only massages, no sex.

ROSS: No sex.

KURTZ: Now on Friday night’s “World News,” you did not report this. You put it on your blog, the blotter, about 9:00 that night. Is that because you didn’t know or decided not to go with it for television?

ROSS: I was off on Friday, actually attending my son’s high school debate tournament and the State Department release came out around 5:00 Friday afternoon. I just didn’t know about it until about 8:00 at night and about an hour later we put it on abcnews.com.

KURTZ: Here I thought there was some elaborate conspiratorial reason and it was your son’s debate tournament. All right. This list of thousands of names, got all these phone records, just as a practical matter, is it difficult to find out who these phone records belong to?

ROSS: It takes some work. We’ve been working on it, our investigative team for the last month, month and a half, going through them all and I think we have a pretty good idea now of who is on the list.

KURTZ: Jeane Palfrey originally talked about selling her list of clients to a tabloid outfit and then obviously, ABC News does not pay for information. Why did she decide to cooperate with you?

ROSS: We told her that we would take it seriously, that it was a potentially important story. Her point is that she runs an operation that she claims offered no sex. And that she sees it as hypocritical that the government is going after her and the women who worked for her and not the men. The phone lists were in her home when the Federal agents raided it. But they were not interested in apparently the names of the men, only the women who worked for her. So she thinks that it is hypocritical. Secondly, she wants to call some of these men to testify on her behalf. She’s turned down a deal, a plea bargain deal from the government and wants to go to trial.

KURTZ: I should have mentioned at the top she’s under indictment and as you say, she apparently plans to go to trial. If a government official pays for this kind of service personally and has nothing to do with his job, is there at least an argument that it’s not news worthy and shouldn’t be reported?

ROSS: Well, I think there — I think it is news worthy that there is this indictment. It’s part of a Bush administration effort under the Department of Justice to crack down on prostitution and this is part of it. Tobias in particular, given his role as spearheading the Bush administration effort overseas to crack down on prostitution, seemed to us to be news worthy.

KURTZ: You are faced with a list of names. You say some of them are fairly prominent people, from not just the government but different walks of life. Is this a dilemma for you as to how far you should push your reporting?

ROSS: The reporting is — we want to know all we can know and then the decision has to be made as to what information we’ll actually use on the air next week on “20/20″ or on “World News”. We actually hadn’t made the decision about Tobias and he didn’t ask me whether we’re going to name him. I guess he just assumed that.

KURTZ: As of now, you are planning on reporting the story on Friday on “20/20.”

ROSS: “20/20″ and on other ABC outlets, “Good Morning America” and “World News” and on the ABC News blotter.

KURTZ: I suspect the story may get a little bit attention when you report it. Brian Ross, thanks very much for calling this morning. Good to talk with you.