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LIMA, Peru (AP) _ Peru's first lady has canceled a $10,000-a-month consulting job with a Peruvian bank after the revelation of the contract raised suspicions of influence peddling.

In a letter to Banco Wiese Sudameris Thursday, Eliane Karp resigned as an adviser on agricultural projects. She maintained that the contract was legal but that she wanted to defuse ``ill-intentioned political motives about the transparency, honesty and legality'' of the position.

The letter was published Friday in El Peruano, the government gazette.

Opposition newspaper La Razon revealed Karp's consulting job last week, setting off a political storm.

Critics said the deal raised ethical questions even if it was legal. One legislator said he would open a probe into possible influence peddling by the first lady.

An indignant President Alejandro Toledo defended his wife's contract in a nationally televised address Monday and demanded that Peruvians ``let her work.'' He slammed the criticism as politically motivated.

Karp, a Belgian-born anthropologist with a doctorate from Stanford University, headed the agriculture department at Banco Wiese Sudameris' forerunner from 1997 to July 2000, when she left to help her husband lead protests against Fujimori's government.

Banco Wiese Sudameris chief Eugenio Bertini urged Karp on Thursday to resign.

Karp had told reporters that she had no salary since Toledo took office and that she had to rely on her husband's income for the first time in her life.

Besides first lady duties, Karp chairs a government commission on Indian and minority affairs. The position is unpaid.