DOBBS: In the midst of our housing crisis, the Bush administration's top housing official today resigned. Housing and Urban Development Secretary Alphonso Jackson is by the way leaving for family reasons, as he put it. He is also under criminal investigation for giving lucrative government contracts to personal friends. Jackson today said he is resigning to spend more time, as I said, with his family. Louise Schiavone has the real story.

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LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): Amid historic turmoil in the nation's housing market, the secretary of housing and urban development has decided to quit.

ALPHONSO JACKSON, HUD SECRETARY: There comes a time when one must attend diligently to personal and family matters. Now is such a time for me.

SCHIAVONE: That following calls for Jackson's removal, the latest from two key senators stating quote, "we are deeply troubled by the growing number of allegations of impropriety on the part of HUD Secretary Alphonso Jackson. We call on you to immediately request Secretary Jackson's resignation", end quote.

At issue, charges of cronyism and falsehoods beginning with the 2006 speech by the HUD secretary in Dallas where he said he denied federal business to a contractor who said he didn't like George Bush. Jackson later said that was basically a lie, but his troubles didn't end there. Ethics watchdog group lawyer, Melanie Sloan.

MELANIE SLOAN, CITIZENS FOR RESPON. & ETHICS IN WASH.: There has been lots of controversies with Mr. Jackson getting involved in contracting issues.

SCHIAVONE: Questioned, HUD contracts in New Orleans and the Virgin Islands to Jackson friends, and accusation by the Philadelphia housing authority that Jackson threatened to withhold federal dollars after it rejected a deal with another friend, and questions from some members of Congress over whether he's been completely forthcoming with them.

SEN CHUCK SCHUMER (D), NEW YORK: Certainly, he leaves under a cloud and this is the worst kind of cloud to leave under in terms of how you did these contracts, not doing them on the up and up.

SCHIAVONE: HUD's inspector general found no quote, "direct evidence" of political favoritism, but did note that in many cases where Jackson interjected himself in a contract decision, the contractor had quote, "Democratic affiliations".

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SCHIAVONE: Jackson spokesman at HUD said there will be no comment on the various accusations, but Lou critics say Secretary Jackson's tenure as HUD secretary has made it all the more remarkable by the fact that he's been almost invisible, and the administration's response to the housing crisis, sidelined perhaps by reported federal probes into his own problems. Lou?

DOBBS: Yes, it's not likely that many people could have even named the secretary of housing and urban development. Thank you very much, Louise Schiavone from Washington.