Former Co-op bank chairman Paul Flowers has been arrested in Merseyside in connection with a drugs supply investigation, police have confirmed this morning.
Mr Flowers was allegedly filmed handing over £300 for illegal drugs.
West Yorkshire Police said officers arrested a 63-year-old in the Merseyside area last night and detectives are questioning him at a police station in West Yorkshire.
In a statement, the force said: “Officers have [...] arrested a 63-year-old man in the Merseyside area in connection with an ongoing drugs supply investigation.
“He has been taken to a police station in West Yorkshire where detectives will continue their enquiries.”
Mr Flowers, a Methodist minister, was suspended by both the church and the Labour party following claims he purchased and used illegal substances.
He resigned from his position as deputy chairman of the Co-Op group in June and questions have been raised over his competence in the role.
He has also faced allegations of illegal drug use, questions over his expenses claims at a drug charity and drink-driving.
It also emerged he had resigned as a Labour councillor after adult material was discovered on his computer.
Co-op bank is seeking to recover contractual payments made to Mr Flowers, who has been instructed to return £31,000.
The bank said in a statement: "When Paul Flowers relinquished his responsibilities in June, it was agreed, as per his contractual obligations, that his fees for the rest of his period of office would be paid.
"Following recent revelations, the board stopped all payments with immediate effect and no further payments will be made."
The bank is conducting an "internal fact-finding review" where they will examine emails and other evidence.
The assistant secretary of the Methodist Conference, the Rev Gareth Powell, acknowledged the risk that allegations against Mr Flowers would "tarnish" the church's reputation.
Mr Powell told the BBC it would be "inevitable" that some of the speculation would raise questions, as it always does for the church, about how trustworthy ministers are.
"Inevitably, it's regrettable when the allegations made against one minister then tarnishes the extremely good and honourable work undertaken by all of our ministers", he said.
"Certainly the actions that are now under public scrutiny inevitably raise a question about the role of the church."
Additional reporting by Press Association