Hank Baskett Affair Report -- Transsexual Model Warns Mag: Stop Spreading Lies!

The transsexual woman who allegedly had an affair with Hank Baskett is threatening to sue a magazine company she claims is spreading lies about their alleged encounter.

As TMZ first reported, Ava London claims In Touch and Life & Style lied when they said they interviewed her and their reporters harassed her to the point she had to call the cops.

Now London's lawyer has fired off a cease and desist letter to Bauer Media, writing, "You must be delusional ... You must be living in a land of strawberry fields where nothing is real and nothing to get hung about."

London wants the stories in question removed from the Internet. She also says if the mags continue to write these stories ... she'll sue.

The bad news for Baskett ... London acknowledges she did give an interview to another outlet in which she claimed to have hooked up with Baskett. She says the two of them simply engaged in a little fun with their hands, nothing more.