Colin Craig is under fire for allegedly omitting election expenses on his 2014 electoral return that would have put him over the permitted spending cap.
The former Conservative Party leader is being accused of leaving more than $7000 worth of spending during last year's election campaign, off his East Coast Bays M30 electoral return.
Former party board member John Stringer has put forward the allegations at a press conference in Christchurch and says he has only recently received proof he needed to make the allegations public, and instigate a formal investigation.
Last year's election expenses spending cap for the three months leading up to the September 20 General Election was set out at $25,700 including GST, for all parties.
The Electoral Act says it is a "serious offence" to go over the cap.
Former ACT MP and party leader John Banks went on trial last year over allegations he declared donations for his 2010 Auckland mayoralty bid from internet entrepreneur Kim Dotcom as anonymous, when he knew who they were from.
He was initially found guilty, but appealed his conviction after new evidence surfaced, and his appeal was upheld.
Mr Stringer says Mr Craig breached spending limits by $2063, by not declaring $7752 worth of spending on his East Coast Bays Return.
The expenditure as filed by Mr Craig was $20,010.50.
He has accused Mr Craig of deliberately falsifying at least five M30 returns, annotating costs across other electorates.
Party officials were concerned Mr Craig was engaged in a "deliberate pattern of dishonesty to conceal this", he says.
Items allegedly not declared by Mr Craig included billboards used at the party's campaign launch on June 22 at Rangitoto College.
An invoice supplied to 3 News sets out the billboards' cost from a billboard production agency addressed to Chameleon Advertising – the Conservatives' advertising agency.
However, the details are not included on Mr Craig's electoral return.
Mr Stringer alleges Mr Craig did not declare the items to ensure he was under the spending cap in East Coast Bay, because he absorbed greater expenses in other electorates.
"There's no question he falsified the documents."
He says he has been looking into the issue for several months, by "wading through documentation and talking with officials within the party".
Mr Stringer will meet with police tomorrow to discuss the documents.
"The Electoral Commission will be looking into this and the police will be investigating," he says.
He says Mr Craig's case is more serious than Mr Banks', because it contains more cases of dishonesty.
However, Mr Craig denies the allegations, saying they're "just wrong".
"Why for goodness sake hasn't [Stringer] raised this question before now?" he said.
"This is just more dirty politics, it’s another false allegation."
He says the campaign billboards were not commissioned by him personally, and were included on the party's general electoral return.
"They've definitely been accounted for."
He says he can "absolutely" provide proof of documentation should it be required.
"I'm very confident that everything's accurate in my return."
Police confirmed they have received Mr Stringer's allegations.
"We are awaiting further documentation from the complainant in relation to these allegations," a spokesman said.
"Once this is received the complaint will be assessed in line with our normal process to determine what, if any further steps are required."
Mr Craig is already suing Mr Stringer for defamation, along with the Taxpayer Union's Jordan Williams and Whale Oil blogger Cameron Slater, claiming they spread rumours he sexually harassed his press secretary.
The Electoral Commission has confirmed that it's received the allegation from Mr Stringer.
Mr Stringer was Mr Craig's campaign manager during last year's general election, when Mr Craig stood in East Coast Bays.
Mr Craig stood down from the leadership in June amid publicity over his relationship with his former press secretary, Rachel MacGregor.
The party's board disintegrated and Mr Stringer appointed himself interim chairman - a position he subsequently relinquished.
Mr Stringer says Mr Craig is destroying the party.
"I am trying to salvage it," he said.
"The party is in catastrophic meltdown, we are in a state of lawlessness regarding our constitution and our rules."