BOGOTA -- Paramilitary leader Carlos Castano quit his post Friday as head of the right-wing united self-defense forces of Colombia, as his group prepared to free a Venezuelan businessman it kidnapped two years ago.

Meanwhile, marxist guerrillas of the AUC's deadly rival, the Revolutionary Armed Forces of Colombia (FARC), stepped up their offensive ahead of next month's inauguration of president-elect Alvaro Uribe, who has vowed to get tough with insurgents.

In a statement on the paramilitary group's internet site, Castano said the July 2000 kidnapping of businessman Richard Boulton and the group's involvement in drug trafficking led to his decision to resign, told AFP.

"I have decided not to continue representing the AUC politically, because everyone always does what he wants, not always with the best scruples, and I do not believe that an organization like this represents calm for Colombians," Castano said in a statement directed to Boulton's family.

Castano blamed both Boulton's kidnapping by the AUC and other criminal activities by the paramilitaries such as drug trafficking, for his decision to resign from his group's political leadership.

The AUC has around 10,000 fighters pitted against leftist rebels in a deadly civil war.

"I have agreed to take charge of the (freeing) of Boulton, provided that (paramilitary faction commanders) Guillermo and El Flaco clearly explain their disastrous attitude toward the country and the world" relating to Boulton's kidnapping, Castano added.

He expressed his hopes that Boulton and his family would be able to "get over the suffering" imposed by the kidnapping. The businessman's release will come in the next few days, Castano said.

Castano's announcement came as Colombian president-elect Uribe, who takes office on August 7, has stepped up efforts to put an end to the bloody civil conflict.

Uribe, who was elected on May 26 has been rallying support for his hardline strategy to end the power struggle between the Bogota government and several guerrilla and paramilitary groups.

He has promised to seek UN-led mediation with both the left-wing FARC -- the country's largest rebel group -- the smaller National Liberation Army (ELN) as well as the paramilitaries.

In the meantime, fighting went on unabated between the guerrillas and Colombian troops as farc pressed an offensive in which 60 people have died over the past several days.

The latest victim was a child who died late Friday in a hospital in Cali, 650 kilometers (404 miles) southwest of Bogota, after being wounded in a guerrilla attack, authorities said.

In the central province of Caldas, three mayors resigned their posts, the latest to go in the three weeks since the guerrillas issued a resign-or-die ultimatum to local officials. Authorities also blamed the assassination of a local council member in the northeastern city of Puerto Santander on the FARC.

So far, more than 120 of the nation's 1,098 mayors have resigned due to FARC pressure in protest at Uribe's tough stance policy.

AUC, the 16,500-strong FARC and the ELN and its 4,000 fighters all figure on U.S. and European Union lists of terrorist organizations.

More than 200,000 people have died as Colombia has been embroiled in a bloody civil war for more than 40 years.