ROME—There is little question that Italy has been slow on the uptake when it comes to recognizing equal rights for the country’s LGBT community. Last year Italy was the last in western Europe to finally pass a same sex union law, though it remains limited. Same sex couples aren’t considered “married” and they can’t adopt stepchildren.

And there are frequent violent homophobic attacks across the country, often in public places like schools and bars with studies consistently show both a lack of tolerance and understanding on both gender and sexual orientation issues.

With that in mind, perhaps it is not surprising that Italy’s anti-discrimination office, UNAR, a governmental agency that earmarks hundreds of thousands of euro to companies and organizations that combat discrimination, doesn’t have a real clear idea about what constitutes actual support of the LGBT community.

Instead, the group’s head Francesco Spano stepped down Monday night after the investigative television show Le Iene (Hyenas) exposed how, under his charge, the government agency had allocated nearly €180,000 in taxpayer money to a variety of associations that run private gay social clubs and saunas across Rome that specialize in sleazy and unsafe prostitution.

Sending a willing gay reporter undercover, Hyenas’ exposé revealed three clubs in the capital that received €55,560 and tax-free status that offered massages and more. One club charged €50 for a basic massage with post-rubdown intercourse or fellatio for a €70 supplement. Another club charged €38 for the massage and €50 for the extra services—the transactions, and much of the encounter, caught on grainy videotape.

The clubs sponsored by the Italian government also featured so-called dark rooms, which were actually red-lit orgy salons where Hyenas’ cameras caught nude men with full erections essentially engaging in random acts of eroticism without condoms between sips of cocktails from an open bar. For the sake of privacy of the club members, no faces were shown in the exposé.

Entrance to the clubs requires a membership card, obtainable with a valid identification. One club bouncer told the Hyena reporter as he signed up that the private membership “keeps out the police and women.”

When asked if the club engaged in any cultural activities, which is a requirement set forth by the Italian government to receive funding and tax-free status, the bouncer can be heard saying, quite clearly, “Just open you’re ass or mouth and you’ve got culture… cock culture.”

Other outtakes from the reportage showed more nude men in a sauna area. Again, the reporter asked about cultural events. “Every now and then they put up a stand at the entrance from an association against AIDS,” a regular customer whose face was obscured told Hyena. “It’s there maybe three times a year.”

Hyena reporters also followed Spano to his government office and confronted him with their findings, which included a photocopy of club membership in his name to one of the clubs that offered prostitution and dark rooms. On camera, he denied knowing about the club or his membership card, and promised to “verify” the associations affiliated with the clubs, promising to “cancel their funding” if anything illicit was found.

But two weeks after the initial confrontation, the clubs were still on the roster, according to the Hyena reporters. When Spano, who did not answer calls for comment, stepped down on Monday, he said it was “not an admission of guilt” but rather “out of respect for the work the office does.”

UNAR did not respond to a request for comment on Tuesday. Calls by leaders for the disbandment of the department were met with scorn by legitimate organizations that do provide financial support for both racial and homophobic discrimination. Among the recipients of UNAR’s government funds are UNHCR, UNICEF and the Italian chapter of the Red Cross.

According to UNAR’s website, organizations and associations must compete for funds through a bidding process, which is allocated and approved by the director who, when the gay clubs were approved, was Spano. When doorstepped by Corriere Della Sera after his resignation Monday night, he defended his group’s work. “The association provides for the creation of support centers for victims of homophobic violence,” he said, insisting that he had no idea those groups he approved provided prostitution among their services.

Italy’s consumer group Codacons issued a statement asking for a criminal investigation into the questionable use of public funds, but warned against penalizing legitimate entities that benefit from the program. “It is difficult to imagine that positive action could include in any fashion activities which include prostitution,” the group said in a statement.

GayLib, an LGBTQ group told AFP that UNAR’s other sponsorships did work to tackle homophobia in the country. “We hope the government intervenes, not to close UNAR, but to verify who receives the money and if necessary demand it be repaid,” Daniele Priori, the group’s national secretary said. “The reputation of Italy’s gay movement is at stake.”