A police fraud investigation into the former deputy leader of NI21 relates to a dispute with the party over the ownership of equipment and research which was carried out for the party, the News Letter understands.
Police arrived at the home of South Down MLA John McCallister – who firmly denies any wrongdoing – on Thursday as part of an investigation into allegations that public funds were misused.
The development is the latest element of the saga around NI21’s implosion just over a year ago.
Mr McCallister left the party in acrimony after alleging that leader Basil McCrea – who had been a personal friend – had attempted to stymie his attempts to investigate allegations that Mr McCrea had engaged in a sexually inappropriate way with a female member of staff.
Mr McCrea strenuously denied the allegations but had declined numerous opportunities to respond in detail to the allegations from Ashleigh Murray, claiming that he is taking unspecified legal action against unknown individuals.
On Friday details of the PSNI investigation emerged.
Mr McCallister said: “Yesterday morning I was contacted by the police who indicated that in the course of ongoing investigations about other matters statements had been taken.
“These had raised some financial aspects from my difficult time in NI21. They were seeking to clarify my position and I was happy to deal with their queries immediately and voluntarily.
“I wish to stress I have nothing to hide and deny there was any wrongdoing on my part. I look forward to the police concluding their investigations and this matter being quickly resolved.”
It is understood that the PSNI probe relates to a dispute between Mr McCallister and NI21 as to who owns a piece of equipment which was purchased using public funds available to Stormont parties, as well as to questions about research which was commissioned by Mr McCallister while he was deputy leader.
PSNI chief superintendent Peter Farrar said: “Police are investigating allegations of the misuse of public funds.
“The allegations relate to potential fraud and theft by a small number of individuals relating to money available under the Financial Assistance to Political Parties Fund.
“Two men aged 43 and 41 were interviewed on June 25 and are to be reported to the Public Prosecution Service. A number of items have been seized as part of ongoing police inquiries. Authorities at the Assembly have been advised of the police investigation.”
Although there has yet been no decision to even prosecute anyone, Mr McCrea claimed in a statement that the party had been “the victim of criminal activity” but said that “neither the party nor any of its members are under criminal investigation”.