  We propose an explanation of the variability of AGN based on a cloud model of
accretion onto a black hole. These clouds, present at a distance of 10-100
Schwarzschild radii, possibly come from the disrupted innermost disk and they
can partially obscure the central X-ray source due to their extreme Compton
optical depth. We consider the implications of this scenario using a toy model
of AGN spectra and support the results with full radiative transfer
computations from the codes TITAN and NOAR. We show that small random
rearrangements of the cloud distribution can happen on timescales of the order
of 10^2 - 10^6 s and may lead to relatively high variability amplitude in the
X-ray band if the mean covering factor is large. The normalized variability
amplitude in the UV band is either the same as in the X-ray band, if the
contribution from the dark sides of the clouds to the UV band is negligible, or
it is smaller. The X-ray spectrum should basically preserve its spectral shape
even during the high amplitude variability, within the frame of our model.
