Anti-Semitism is blamed for furore over Lord Levy

As the man at the centre of the most high-profile political scandal for years, Lord Levy has enjoyed precious few public expressions of support in recent weeks.

But yesterday the peer found comfort in the form of his many allies in London's Jewish community as a succession of voices claimed that a witchhunt against him was being fuelled partly by anti-Semitism.

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Sir Alan Sugar, the Amstrad tycoon and hard-hitting star of the reality television series The Apprentice, said he feared that Lord Levy would be made a "scapegoat" in the police investigation into the cash-for-honours affair.

The famously outspoken businessman claimed that some attacks were being made in newspapers with a record of being "negative" about Jews and Asians. "I think they rub it in when either the Asian or the Jewish community get themselves into some form of trouble," he said.

Lord Levy's rabbi, Yitzchak Schochet, writing in The Jewish Chronicle, denounced "the blatant nastiness in some of the tabloids and the recent seeming trial by media". Rabbi Schochet, of Mill Hill synagogue in north-west London, where the embattled peer is a congregant, earlier accused "sinister corners" for the leaks, and claimed: "The Jewish community is becoming increasingly more sensitive that there is one Jew, who has been called the most dynamic Jew in Anglo-Jewry, seemingly being hung out to dry here."

The Jewish community in north London, where Lord Levy lives and has raised millions of pounds for charity, has praised him in the Chronicle for the work he has done for good causes in their community. Louise Ellman, a Labour MP and member of the all-party Parliamentary group on anti-Semitism, said he had "attracted tremendous jealousy". Asked whether anti-Semitism was behind the smears, she said: "I don't think it is possible to be certain about it, but the whole matter does create a great deal of uneasiness."

Sir Alan, a friend of Lord Levy, mounted an attack on Tony Blair on BBC Radio for failing to do more to protect the fundraiser from damaging leaks which reached fever pitch this week over his arrest on suspicion of perverting the course of justice in the cash-for-honours affair.

Downing Street denied being behind leaks that Lord Levy "bullied" Ruth Turner, the Prime Minister's "gatekeeper" to change her version of events about the nomination of Labour donors for peerages. But some observers said the impression was left that Lord Levy was being made the fall guy.

Sir Alan said Lord Levy had a "blind devotion to Tony Blair who claims to be his friend; looking at the newspaper reports and television reports now, with friends like him, you don't need any enemies.

"I have a lot of respect for Blair. I think he is a decent man. But he will go down in my estimation if he allows this nonsense to continue in respect to Levy. Levy has raised a lot of money for his party and assisted him to get elected. It looks like he's the scapegoat, particularly this last week with allegedly some woman he's been allegedly bullying."

Sir Alan said he hoped the police "don't come up with some trumped-up charge to make it look like they are doing their job".

He added: "When you think about it, what's in it for Levy? This is not a man who has lined his pockets. This is a man who got blind devotion to Tony Blair and blagged people for money for the Labour Party; that to me is his worst crime."

Lord Levy is still officially the Prime Minister's envoy to the Middle East, for which he is not paid. He has been arrested twice in connection with Scotland Yard's high-profile inquiry, the second time on suspicion of conspiracy to pervert the course of justice. He has been at the centre of a series of allegations about the affair this week, but he has vehemently denied any wrongdoing.