Allegations against Fylde MP referred to Lancashire Police
Mark Menzies has been accused of misusing campaign funds.
Allegations that MP Mark Menzies misused campaign funds have been referred to Lancashire Police.
The force said it was "reviewing the available information" after receiving a letter "detailing concerns around this matter".
The PA news agency understands that Labour Party chairwoman Anneliese Dodds wrote to Lancashire Police calling for an investigation into allegations about Mr Menzies.
The Fylde MP lost the Conservative whip and was suspended as one of Rishi Sunak's trade envoys after The Times published claims he had used political donations to cover medical expenses and pay off "bad people" who had locked him in a flat and demanded thousands of pounds for his release.
Mr Menzies disputes the allegations and the Tory Party has said it was looking into the claims and took them seriously.
Labour said the Tories "sat on their hands" for more than three months after finding out about the claims, while the Liberal Democrats called for the Prime Minister's independent adviser on ministers' interests to investigate the handling of the row.
Mr Menzies' former campaign manager who allegedly received a late-night phone call from him asking for cash has said she felt "let down" by the party after she raised concerns with Chief Whip Simon Hart.
Mr Menzies is said to have called 78-year-old Katie Fieldhouse at 3.15am one day in December, claiming he was locked in a flat and needed £5,000 as a matter of "life and death".
The sum, which rose to £6,500, was eventually paid by his office manager from her personal bank account and subsequently reimbursed from funds raised from donors in an account named Fylde Westminster Group, it is alleged.
The Times also reported that £14,000 that was given by donors for Tory campaign activities was transferred to Mr Menzies' personal bank accounts and used for private medical expenses.
Ms Fieldhouse said she became frustrated with the way the Conservative Party handled her complaint after she reported her concerns to Mr Hart in January.
"I put my faith completely in the party ... nothing happened - I heard nothing ... I am appalled," she told the BBC.
"I work myself into the ground for the party - all they hear is a 78-year-old little old lady.
"The party has let me down."
Lib Dem leader Sir Ed Davey said Mr Sunak's independent ethics adviser, Sir Laurie Magnus, should look into the handling of the row.
He told the PA news agency: "It appears that the Chief Whip Simon Hart knew a lot about this and failed to take action, and if you look at the ministerial code, it requires him to do that.
"And so the Conservatives have really failed. And therefore, I think there is a role and job for the ethics adviser to investigate."
Labour leader Sir Keir Starmer told broadcasters: "In the last 24 hours we have found out that the Government was told months ago about this, and they seem to have sat on their hands.
"If they thought they could sweep this under the carpet somehow, they were obviously very mistaken and that is why I think there are very serious questions now that need to be answered.
"Not just by the individual but also by the Government on this."
Meanwhile, Mr Sunak declined to say whether Mr Menzies should quit as Fylde MP.
The Prime Minister told reporters after a speech in London on Friday: "It's right that Mark Menzies has resigned the Conservative whip.
"He's been suspended from his position as a trade envoy whilst the investigations into those allegations continue.
"For our part, I can't comment on our ongoing investigation while it's happening, and he's no longer a Conservative MP, as I said."
In a statement to The Times, Mr Menzies said: "I strongly dispute the allegations put to me. I have fully complied with all the rules for declarations. As there is an investigation ongoing, I will not be commenting further."
A Conservative Party spokesman said: "The Conservative Party is investigating allegations made regarding a Member of Parliament. This process is rightfully confidential.
"The party takes all allegations seriously and will always investigate any matters put to them."
A spokeswoman for Chief Whip Mr Hart said Mr Menzies had "agreed to relinquish the Conservative whip, pending the outcome of an investigation", meaning he would now sit as an Independent MP. First for all the latest news from across the UK every hour on Hits Radio on DAB, at hitsradio.co.uk and on the Rayo app.