A Ukip MEP and general election candidate has been suspended over “allegations of a serious financial nature” surrounding EU expenses.
Janice Atkinson, due to challenge the Conservatives in Folkestone and Hythe on May 7, has been stripped of the party whip while the claims are investigated.
The Sun reported a staff member had obtained an invoice for a sum more than three times the actual cost of an event, apparently with the intention of claiming it back from Brussels funds.
The newspaper said the individual told the manager of the restaurant which hosted the event - and who had alerted the newspaper to the meeting to discuss the cost - that: "The idea is we overcharge them slightly because that's the way of repatriating (the money)."
Ukip leader Nigel Farage said he was “shocked and surprised”.
The £950 food and drink cost of the event, held ahead of the party's recent spring conference in Margate, was paid by credit card, according to the report, which included video footage of the discussions over the bill.
But it is alleged that the staff member negotiated for and accepted an invoice for £3,150, made out to the newly-formed grouping of right-wing parties Alliance for Direct Democracy in Europe (ADDE) of which Ukip is the biggest member and its associated foundation The Initiative for Direct Democracy in Europe (IDDE).
The newspaper said it had handed the footage to Kent Police and the European Parliament.
A Ukip spokesman said: "The party is incredibly disappointed with Ms Atkinson, who appears to have exercised extremely poor judgment in acting in a way that the party has never, and would never condone.
"The party has acted swiftly and immediately.
"We always maintain a zero tolerance attitude towards acts of this nature."
It comes after Ms Atkinson caused controversy by calling a Thai woman a “ting tong” while being filmed by TV cameras. She insisted the comments were naive rather than malicious and has since apologised to the woman.
Mr Farage, asked about the allegations after an event in Kent, told The Telegraph: "If what she has been suspended for is right I am astonished she could have done something quite so stupid. I am very, very shocked and surprised.
"It looks like a claim that wasn't made, I am pleased to say, but a claim that was intended to be made that may not have been as genuine as perhaps it should have been.
"It would appear there was the intention to produce a receipt that may not have been genuine."
The party was quick to stress that the decision meant Ms Atkinson was no longer its general election candidate in the seat - where Tory Damian Collins is defending a healthy majority of 10,122.
Mr Farage was reported to have told the Telegraph that a reinstatement remained possible but unlikely.
Ms Atkinson has been contacted for a comment.
Additional reporting Press Association.
