She was the moral majority pin-up. And then someone saw one of her old movies

Carrie Prejean condemned gay marriage on the Miss USA stage, losing her the crown, but endearing her to conservative America

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Note to the religious Right: if you're going to ask a surgically enhanced beauty queen to promote family values, it's best to check that her previous career hasn't involved soft core pornography.

Carrie Prejean, the former Miss California whose opposition to gay marriage made her American conservatism's top pin-up, stands accused of an act of hypocrisy that would embarrass even the nation's political class: starring in what salacious news reports are calling a "solo sex tape".

The film, obtained by tabloid website TMZ.com, is described as "an X-rated version of Home Alone," but has yet to be posted on the internet by the site's editors. Apparently, even heavy pixilation fails to prevent it being unsuitable for family viewing.

Quite how starring in the video ever sat with Miss Prejean's religious convictions is anyone's guess. At the Miss USA contest earlier this year, she became an overnight celebrity after telling viewers that her lifelong faith in God convinces her that "marriage should be between a man and a woman". That comment apparently scotched her chances of winning the coveted title. In the ensuing controversy, which lasted several weeks, she was eventually also fired as Miss California, after falling out with pageant organisers.

The sex tape was filmed long before that row. But news of its existence has seriously harmed Miss Prejean's political stock at a time when gay marriage is firmly back on the public agenda. A small majority in Maine voted last week to outlaw the practice. But on Friday, a right-wing group called "Defenders of the Family" announced that it had decided to ditch the pneumatic blonde as its celebrity guest at a black tie fundraiser being held in New Jersey. Spokesmen refused to discuss the decision.

The emergence of the tape also appears to have damaged Miss Prejean's financial prospects. Two days earlier, she dropped a lawsuit against the organisers of Miss California, whom she'd been trying to sue for a total of $1m (£600,000) for "libel, slander and religious discrimination" in connection with her sacking. At a legal meeting this week, a lawyer for the Miss California franchise apparently began playing a copy of the sex tape to Miss Prejean and her lawyers, in order to illustrate his client's point that she deserved to be fired for bringing the beauty pageant into disrepute.

"When the video started playing, Carrie's first reaction was 'that's disgusting'," reported TMZ, which claims to have spoken to lawyers who attended the meeting. "Carrie denied it was her. Then, the camera angle changed... and panned up to her face. She was caught red-handed, so to speak. Carrie was rendered speechless and immediately began talking with her lawyer. We're told it took about 15 seconds for Carrie to drop her $1m demand."

A "confidential settlement" was swiftly announced, under which Miss Prejean is widely reported to have walked away with nothing except her legal costs of roughly $100,000. In a joint statement, both sides "wish each other well in future endeavours". The development completes the misfortune suffered by Miss Prejean since she put herself in the public eye. Earlier in the legal battle, files revealed that Miss California had paid $5,000 for her to have breast augmentation prior to the Miss USA pageant.

Miss Prejean's lawyer, Charles LiMandri, has not commented on the tape. But he claims to be highly upset that "inaccurate and misleading" rumours about the nature of the legal settlement had been leaked to the media.

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