The UK Independence Party’s troubles deepened yesterday as it suspended one of its MEPs after allegations that he had embezzled European funds. Two other MEPs who were upset by the decision then threatened to leave the party.

Tom Wise, MEP for the East of England, had the party whip withdrawn after failing to tell Nigel Farage, leader of the party, that the EU anti-fraud office was investigating claims that he had wrongly received up to £40,000 in payments for an assistant.

Mr Farage suspended Mr Wise after first learning of the official fraud inquiry from last week’s edition of The Sunday Times. The MEP had known since the start of the month.

The newspaper claimed that he spent £6,500 on a dark green Peugeot 406.

Mr Wise’s suspension, decided at a heated party meeting in Brussels, was challenged by Roger Knapman, the former leader, and Mike Nattrass, MEP for the West Midlands, who threatened to consider their own future in the party, The Times understands.

The split among MEPs added further to UKIP’s problems after the Electoral Commission ordered it to forfeit £367,697 last month because the donor did not appear on the electoral register.

Mr Knapman and Mr Nattrass are understood to have told Mr Farage that they will let him know next week whether they will continue under his leadership. The suspension of Mr Wise leaves UKIP with nine serving MEPs, down from the twelve who won seats at the 2004 European elections when the party received 16.8 per cent of the vote.

Robert Kilroy-Silk left UKIP in 2005 to set up his own party, Veritas, and then resigned from that to be an Independent. UKIP has also parted company with Ashley Mote, MEP for the South East, who allied himself to the far-right Identity, Tradition and Sovereignty Group in the European Parliament.

Mr Wise is alleged to have pretended that his own bank account was that of his researcher, Lindsay Jenkins, against EU rules. From November 2004 until October 2005 he is alleged to have channelled £39,100 into it, from which he paid Ms Jenkins £13,555.

When the allegations surfaced, Mr Wise began repaying £25,530. An official inquiry was formally begun last month and may delve into UKIP accounts.

It is understood that Mr Wise admitted at yesterday’s meeting that he used some of the money to buy a car.

UKIP said that the suspension was not a prejudgment and that Mr Wise would be welcomed back if cleared. Mr Farage said: “I think there is a great deal of public sympathy for us.”

Party politics

- The UK Independence Party was formed in 1993 at the London School of Economics by members of the Anti-Federalist League

- In 1999 won three seats in the European Parliament with 7 per cent of the vote

- In 2004 Robert Kilroy-Silk joined. The party won 12 seats in the European election with 16.8 per cent of vote. In 2005 Mr Kilroy-Silk resigned after failing to become leader

- The party contested 497 seats at the 2005 election

- It got its first foothold in Parliament this year when two peers defected

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