Austrian Vice-Chancellor Heinz-Christian Strache, a key figure of the European far-right, resigned on Saturday following revelations that he had promised public contracts in return for campaign help in Austria's 2017 parliamentary elections from a fake Russian backer.
"I tendered my resignation as vice-chancellor of Austria to Chancellor Kurz, and he accepted this decision," Strache said in a televised statement.
Strache insists he was the "victim of a targeted political attack" which had used illegal means, but said that he was leaving in order to avoid further damage to the government.
Germany's Der Spiegel and Sueddeutsche Zeitung published hidden-camera recordings of a sting operation they say took place in a luxury villa on the island of Ibiza a few months before 2017's elections in Austria.
In the recordings Strache and his party's group leader in parliament Johann Gudenus are seen discussing with a woman purporting to be the niece of a Russian oligarch how she can invest in Austria.
She says she specifically wants to gain control of the country's largest-circulation tabloid, the Krone Zeitung.
Strache is seen suggesting that new owners could make staff changes at the Krone and use the paper to help his Freedom Party in its election campaign.
He goes on to suggest the woman would then be able to gain access to public contracts.
Chancellor Sebastian Kurz was due to give his reaction to the scandal later on Saturday, with rumours rife that he may push for early elections.