WEST PALM BEACH, Fla. -- U.S. Rep. Tim Mahoney is under investigation amid reports the democratic lawmaker had an affair with a staffer and then offered her more than $120,000 in hush money.

Related Content: Click here to read the ABC News report in its entirety.

A photograph shows Mahoney, a West Palm Beach Democrat, with Patricia Allen, the congressional staffer who, according to ABC News, was his mistress.

When Allen wanted to end the affair, her friends told ABC, the congressman threatened her job. She threatened to sue.

In part of a recorded phone conversation between the Allen and Mahoney, copied and given in part to ABC, Mahoney said he would fire her.

This conversation reportedly took place on January 20:

Mahoney: "You work at my pleasure. Do you understand what that means?"

Allen: "What does it mean?"

Mahoney: "It means you work at my pleasure. If you do the job that I think you should do, you get to keep your job. Whenever I don't feel like you're doing your job, then you lose your job. And guess what? The only person that matters is guess who? Me. You understand that?"

"We're told that she hired a lawyer, threatened to sue him for sexual harassment, humiliation, degradation, a variety of charges, wrongful termination," Brian Ross, ABC News chief investigative correspondent told Local 10.

The recorded phone call continued as follows:

Allen: "And you, you're firing me for other reasons and you don't have -- you're not man enough to say it."

According to ABC News, this led to mediation.

"In the end, Mahoney agreed to pay $121,000 -- half to her and half to her lawyer -- and to give her a job for two years at $50,000 at his political consulting firm," Ross said.

Mahoney, who is married, reportedly met Allen at a campaign stop, promising a world "more moral."

He was campaigning against Mark Foley, who resigned after he was accused of sending lewd E-mails and text messages to teenage boys and congressional pages.

Part of the $121,000 payoff, ABC News reported, was Allen's silence.

Mahoney: "And let me tell you something else. If I find out that you say anything else, you won't get your last paycheck."

Allen: "like what do you think I'm going to say?"

Mahoney: "I don't give a (expletive)."

As of Monday night, Mahoney's name was still on the ballot for re-election. But House Speaker Nancy Pelosi said she would launch an ethics investigation.

In a written statement, Pelosi said: "I just learned today about the serious allegations concerning congressman Tim Mahoney. These charges must be immediately and thoroughly investigated by the House Ethics Committee."

In a statement issued on Tuesday -- with his wife, Terry, by his side -- Mahoney admitted causing "pain" in his marriage but denied paying hush money to Allen to be quiet about an affair. He said he takes "full responsibility" for his actions and the pain he caused his wife and daughter, but did not directly admit having an affair.