Conservative Party deputy chairman Robert Halfon is believed to be the subject of a blackmail plot, which emerged as he admitted to a relationship with a Tory campaigner.
Mr Halfon, the former political director of Conservative Friends of Israel and the descendant of Libyan Jews, was reportedly filmed as he left a club with the woman.
Senior Conservative aide Mark Clarke has been reported to the party for allegedly attempting to mastermind the blackmail plan.
The party said it had received a complaint about Mr Clarke’s actions in August and that chairman Lord Feldman was investigating.
Mr Clarke, who devised part of the Tory strategy to win the election, has denied any role in the episode.
Mr Halfon, who is not married but has a long-term partner, said: “What I did was wrong, and I feel ashamed. I am not proud of myself. The most important thing to me is to continue to repair my relationship with my partner."
The Harlow MP was promoted to the cabinet and given the key role at the top of the party by David Cameron following the general election in May.
He has enjoyed a rapid rise through the Tory ranks, due largely to his reputation as a campaigner for consumer rights.
Widely hailed for his lower petrol price crusade, he was appointed as Chancellor George Osborne’s private secretary last year.