The Tory leadership front runner, Mr Michael Portillo, accepted over £20,000 in undeclared political donations in return for giving private briefings and dinner speeches while a member of the Major cabinet, according to documents and other evidence.
The money from US and British firms - which was not declared to parliament - was channelled to his then local constituency association in Enfield, north London. Mr Portillo gave the briefings to top business people at private dinners he was employment secretary and defence secretary.
As Tory MPs vote today in the first round of the Conservative leadership contest, these allegations will raise fresh questions about Mr Portillo's judgment. One former cabinet colleague said: "It is wrong and breaks the spirit of the ministerial code. Such a person should not be an MP, let alone a minister of the crown."
Mr Portillo issued a brief denial of any wrongdoing last night: "These are untrue allegations of improper behaviour from an unreliable source."
He added: "I think the timing of producing this smear . . . suggests to me that this is an attempt to influence the outcome of the leadership election".
Like all MPs, he is supposed to disclose on a public register any pecuniary interests which people might consider would influence his behaviour. As a cabinet minister he also had a duty, under the ministerial code of conduct, not to take any money which might appear to place him under an obligation.
Rules in force in 1995 said: "No minister or public servant should accept gifts, hospitality or services from anyone which would or might appear to place him under an obligation".
The rules also say MPs should register "any material benefit which might reasonably be thought to influence their actions". They specifically require disclosure of regular donations by companies to the MP's constituency party "if the donation is linked directly to the member's candidature".