When he was invited by Gordon Brown to be the Prime Minister’s personal fundraiser, Jon Mendelsohn knew it was a job with the potential for enormous public exposure.

After all, his immediate predecessor was his good friend Lord Levy, who faced 18 months of allegations before being cleared over the cash for honours affair.

But few could have predicted that, only weeks into the job, Mr Mendelsohn’s name would also be high on a list of suspects being pored over by Scotland Yard detectives.

Officers investigating “Donorgate” are considering questioning the quietly spoken North Londoner after further allegations from the party donor at its centre.

David Abrahams claimed in an interview with a Sunday newspaper that when they met at a dinner some months before Mr Mendelsohn became chief fundraiser, not only had they spoken about his methods of obscuring donations from the electoral authorities, but Mr Mendelsohn had also told him it was a “good idea”. Mr Mendelsohn said that the claims were “fictional and completely untrue”.

The prospect has left his friends shaking their heads in disbelief. One said last week that he had hoped to clear up the financial mess at Labour’s headquarters, not add to it.

A polite and determined Labour loyalist, Mr Mendelsohn, 40, was born into a family from a lower-middle-class background.

His political affiliations emerged while studying politics in Leeds in the Eighties. He was talent-spotted by a member of Tony Blair’s inner circle in the mid-Nineties.

He was recruited as a business adviser and was seen as a key part of the team that galvanised support among Britain’s business community in the run-up to the 1997 general election.

This is the second time, however, that he has found himself at the centre of a controversy. Soon after Labour’s landslide victory in 1997, Mr Mendelsohn was the “M” of LLM, the lobbying firm he set up. Within a year LLM was caught up in a cash-for-access row when executives were allegedly caught boasting about their links to the Labour hierarchy. LLM denied impropriety. The scandal did not dent the company’s prospects. The business sold for £10 million in July 2005.

Mr Mendelssohn’s appointment in September to the job of fundraiser confirmed him as a key Brownite and personal favourite of the Prime Minister. His wife, Nicola, 35, is a close friend of Sarah Brown and is deputy chairman of the advertising agency Grey London.

Friends of Mr Mendelsohn say that there is a history of tensions with Mr Abrahams. It dates back to a dispute at the Labour Friends of Israel, a pressure group, that Mr Mendelsohn chaired from 2002 until last year.

It is understood that Mr Mendelsohn made it clear that he did not believe Mr Abrahams should be involved in the organisation. Some say they disagreed over the situation in the Middle East. Others believe that Mr Mendelsohn simply disliked Mr Abrahams’s eccentric behaviour.

Whatever the source of the tension, Mr Mendelsohn’s recent statements have been dissected by opponents eager for another big resignation. The Tories have focused on his claim that he was satisfied by assurances from Peter Watt, the party’s now-departed general secretary, that Mr Abrahams’s donations through intermediaries were entirely legal.

George Osborne, the Shadow Chancellor, said that he found it incredible that a director of the Labour Party’s general election resources was not familiar with party-funding law.

Opponents also asked why he did not alert the Electoral Commission, or inform anyone at Downing Street.

This weekend Mr Mendelsohn declined requests for interviews. He has already consulted libel lawyers – he is suing the London Evening Standard and the Daily Mail over allegations of impropriety – and, before the year is out, he may also need the advice of criminal solicitors.

Who said what, when

November 27

Mr Abrahams tells Newsnight he received a letter from the Labour Party asking for more money: “I’ve just got a letter through my door from Jon Mendelsohn. [It said] ‘The party is appreciative of all the help and support you have given over many years’.” Mr Mendelsohn says the letter was sent to set up a meeting where he would request the end of the practice of sending donations through others. “I decided to tell Mr Abrahams that his method of contribution was unacceptable. I had no intention of asking Mr Abrahams for donations and wanted to explain this to him personally,” he said.

December 2

Mr Abrahams claims that Mr Mendelsohn commented on his method of hiding donations when they met last April at a dinner. “I told him I regularly donated to the party and I described how it was done, through intermediaries for the purposes of anonymity, to which he replied, ‘That sounds like a good idea’.” Mr Mendelsohn says: “This latest statement is fictional and completely untrue. I will be cooperating fully with the police in their investigation.”

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