Watchdog rejects call for cash inquiry into Leicester East MP Keith Vaz

Parliament's standards watchdog has rejected a call to investigate Keith Vaz over claims "suspicious" sums of cash were paid into his bank accounts.

Parliamentary standards commissioner Sir John Lyon was asked to look into the Leicester East MP's financial affairs after an article last week in the Daily Telegraph.

The story outlined details of a 12-year-old Scotland Yard probe into Mr Vaz's financial affairs.

It claimed detectives discovered £500,000 was apparently deposited into the Labour politician's accounts over a six-year period – in addition to his salary – between 1997 and 2001.

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The Telegraph story suggested a police document revealed officers could not establish the source of the cash but the report said "the level of funds received... are of a suspicious nature".

Mr Vaz said the payments "were not suspicious in any way and related to a property sale".

Tory North West Leicestershire MP Andrew Bridgen wrote to the parliamentary standards commissioner, who is responsible for investigating complaints about MPs who have allegedly breached the members' code of conduct.

He asked Sir John Lyon to see whether Mr Vaz broke the rules by failing to declare outside interests.

Yesterday, the commissioner's office said it had considered Mr Bridgen's complaint but would be taking no further action regarding Mr Vaz, who had denied there was anything suspicious in the payments.

A spokeswoman for Sir John said: "He has taken the decision not to act on the complaint."

She said the decision was taken because of the amount of time that had passed since the conduct he was being asked to look at. She also said the previous commissioner had investigated former Europe minister Mr Vaz over his relationship with the Hinduja Brothers – billionaire Indian businessmen who were seeking British passports.

Following that probe in 2001 and 2002, Mr Vaz was given a month-long suspension from Parliament, for "serious breaches" of the MPs' code of conduct and contempt of the house.

Mr Vaz was yesterday unavailable for interview but his office issued a statement saying: "Rt Hon Keith Vaz MP received a copy of a letter today from the parliamentary standards commissioner Sir John Lyon to the Conservative MP for North West Leicestershire Andrew Bridgen stating that he would be rejecting Mr Bridgen's complaint against Mr Vaz which was based on an article in the Daily Telegraph."

Mr Vaz had denied having any outside interests. In a statement, issued last week, he said: "These matters relate to two Parliamentary inquiries which began in 1999 and concluded in 2003.

"My finances were discussed by every newspaper in the country for three years and were the subject of extensive examination.

"I have had no outside interests.

"The Telegraph claims the unnamed police officer states the payments into my account were suspicious.

"They were not suspicious. They relate to the sale of a family home in London, the purchase of a new family home and a drawdown of equity from my bank."

Mr Bridgen was unavailable for comment yesterday.

The Metropolitan Police declined to comment.