Gwinnett County police Wednesday arrested Taylor and her alleged business partner, Nicole Alaine Probert, and promptly charged both with racketeering, prostitution and drug offences, the Atlanta Journal-Constitution reported.
Both women are suspected of charging men up to $15,000 to have sex with them and providing some clients with drugs.
Police are investigating whether the two were producing pornography at Taylor's mansion and have begun procedures to seize the site on grounds that it was bought with proceeds from criminal activity, the newspaper said.
The police had been investigating the home in the Sugarloaf Country Club community subdivision for nearly five weeks after receiving tips from neighbors.
The paper said Taylor was named Penthouse's Pet of the Month in a 1985 issue and had also made pornographic films under the stage name Melissa Wolf.