A member of Prime Minister Tony Blair's inner circle was today arrested on suspicion of perverting the course of justice by police officers investigating cash-for-honours allegations.
Ruth Turner, the 10 Downing Street director of Government communications, was questioned at a London police station before being released without charge pending further inquiries.
Mr Blair said he continued to have "complete confidence" in Ms Turner, who he described as "a person of the highest integrity".
The fact that Ms Turner was questioned on suspicion of perverting the course of justice will spark speculation in Westminster that the police may be turning their attention towards the possibility of an attempt to cover-up the sale of honours.
As Mr Blair's "gatekeeper" - a post previously held by close aides Anji Hunter and Baroness (Sally) Morgan - she holds a key position in No 10, reporting direct to chief of staff Jonathan Powell and playing a role in controlling access to the PM.
She was previously interviewed under caution in September last year, reportedly in relation to emails uncovered by detectives during a search of Downing Street computer and paper files.
She becomes the fourth person to be arrested in the inquiry, after Mr Blair's personal fundraiser Lord Levy, major Labour donor Sir Christopher Evans and headteacher Des Smith.
In a statement released by 10 Downing Street, Mr Blair said: "Ruth is a person of the highest integrity for whom I have great regard and I continue to have complete confidence in her."
In a statement, Scotland Yard said Ms Turner's arrest at her London home was "in connection with alleged offences under the Honours (Prevention of Abuses) Act 1925 and also on suspicion of perverting the course of justice".
It said that this "new development" would require officers from the Metropolitan Police's Specialist Crime Directorate to carry out additional investigations.
This will delay the delivery of a file on the cash-for-honours inquiry to prosecutors, which many in Westminster had been expecting this month.
The inquiry, under Deputy Assistant Commissioner John Yates, was launched in March last year after complaints from two MPs that wealthy individuals who lent millions of pounds to Labour were later nominated for peerages, and was later extended to cover the Conservatives.
Mr Blair was questioned at Number 10 shortly before Christmas, but was not arrested or cautioned.
Reports have suggested that Ms Turner's September interview revolved around email correspondence found by police when they searched computer and paper files in Downing Street.
It was reported that police questions then centred on emails which appeared to have been sent to and from Ms Turner's Downing Street workstation, discussing which lenders might be placed on a list of nominees for peerages.
Police today confirmed that it remained "a cross-party investigation" into alleged breaches of the Honours (Prevention of Abuses) Act 1925 or the Political Parties, Elections and Referendums Act 2000.
Ms Turner, 36, was appointed as a Downing Street special adviser in May 2005, having previously served on Labour's ruling National Executive Committee and stood for the party in the 1999 elections to the European Parliament.
A Downing Street spokeswoman said she remained in her job, adding that people should await the end of the police inquiry before reaching any conclusion.
"With all police investigations, it is important they are allowed to run their course and conclusions aren't jumped to," she said.
Liberal Democrat MP Edward Davey, chief of staff to party leader Sir Menzies Campbell, said: "As this sorry saga continues, it is clear that the Blair Government is now in its dog days, increasingly mired in sleaze.
"There is an urgent need for party funding reform as well as an overhaul of the honours system and the House of Lords. Until this happens, the taint of corruption will continue."
Angus MacNeil, the Scottish National Party MP whose complaint sparked the cash-for-honours inquiry, said: "Water is now lapping around Blair's neck. This investigation is now right inside the door of Number 10.
"Over 90 people have now been interviewed, including Ruth Turner in September. The plot seems to be thickening the longer the investigation goes on.
"For one of the alleged offences to be 'suspicion of perverting the course of justice' is particularly interesting, perhaps suggesting some sort of behind-the-scenes cover-up."
And Plaid Cymru parliamentary leader Elfyn Llwyd, who also made a complaint to police, said: "I have always said that the buck stops somewhere in Downing Street, and it becomes less and less credible that Blair had no full knowledge of what was going on when persons so close to him were involved in the scandal.
"This is a spider's web which is busily unravelling and I commend the Metropolitan Police for the thoroughness of their inquiry.
"This investigation has shown that there is corruption at the heart of Government - mired in sleaze and on a slide to nowhere."
News of Ms Turner's arrest came as Attorney General Lord Goldsmith dismissed suggestions that he would stand aside from decisions about whether to prosecute over the cash-for-honours investigation.
In a letter released by a Commons committee today, Lord Goldsmith said Lord Chancellor Lord Falconer was wrong to give an assurance that he would not get involved in the case.
Lord Goldsmith, a close Cabinet ally of Mr Blair, told the Constitutional Affairs Committee: "I know the Lord Chancellor well understands that he was not in a position to give an 'assurance', as you have termed it, as to how I would act.
"No other minister, however distinguished or senior, has the ability to bind the Attorney General in how he exercises his role."
Lord Falconer last year told the committee that the Attorney would not "interfere in the normal course of decisions" taken by the CPS in the case.
But Lord Goldsmith later insisted his statutory responsibility to advise on sensitive cases meant it would not be right for him to stand aside.
The committee has launched its own inquiry into Lord Goldsmith's role in advising prosecutors, which opposition parties claim could involve a conflict of interests.
Committee chairman Alan Beith said: "The fact that the Lord Chancellor and Attorney General could, in good faith, give us two rather different accounts of the Attorney General's role underlines the case for examining the role of the Attorney General, and we have now launched an inquiry to that effect."Reuse content