Disgraced MP Derek Conway still faces the threat of a criminal investigation into his use of public funds to pay his full-time student son as a researcher, Scotland Yard indicated today.
Metropolitan Police Commissioner Sir Ian Blair said they were not "ignoring the situation" as he demanded a sleaze watchdog tell him if they wanted his force to look into the case.
But his comments caused confusion at Westminster, as Parliamentary Standards Commissioner John Lyon's office insisted it had already been made clear they were not referring the matter.
The decision not to call in the police was announced by Sir George Young when he told MPs that Mr Conway would be suspended from the Commons for 10 days and forced to repay the money.
Sir George chairs the Commons Standards and Privileges Committee to which Mr Lyon reports.
Sir Ian however suggested his force had been unable to proceed with any investigation of other complaints against Mr Conway because it had not been notified by Mr Lyon of his decision.
The Liberal Democrat candidate in Mr Conway's Old Bexley and Sidcup constituency, Duncan Borrowman, wrote calling for a police inquiry at the height of the scandal.
"There is a protocol. The protocol was agreed with the previous Parliamentary Standards Commissioner," he told a meeting of the Metropolitan Police Authority.
"It doesn't appear from the face of it that that protocol was fully followed in this particular case and what we have done is to write to the Standards Commissioner and ask him whether he is going to refer the matter to the MPS and if he isn't what are his reasons and we await that answer."
He went on: "The MPS can - and has demonstrably - investigated matters wherever they arise.
"But we obviously, and as in the Electoral Commission or in the benefits department or wherever else, we start with the position that the adjudicating authority has a right and role first and we will wait and see what the answer is.
"We are just trying to follow the process but we haven't, and we are not, ignoring the situation."
But Mr Lyon's office rejected any suggestion that they were required to directly inform the Met of any decision not to refer a case to the police.
"No such protocol exists," his spokeswoman insisted - saying that the situation over referral to the police remained as it was when Sir George made his statement to the Commons.
Mr Conway said he had had no contact from Scotland Yard over the matter, despite a complaint being lodged by a former political rival.
He was suspended from the Commons for 10 days and thrown out of the Tory party for overpaying his son for "all but invisible" research work at the expense of taxpayers - and will step down as an MP at the next general election.
The development came as the Standards and Privileges Committee published proposals to force MPs to publicly declare the names and jobs of family members they employ at taxpayers' expense.
It said the rules should come into force in April but could be made voluntary until July to give time to deal with any technical or legal issues involved.
In a report, the committee said there should be greater transparency "where the terms of the employment might be influenced, or perceived as being liable to influence, by virtue of the existence of a personal relationship between the parties".
It said the names of each family member, how they were related to the MP and the nature of the job they were employed to do should be included on the Register of Members' Interests - but not the actual salary paid to each, which would be clear from the type of role.
Any casual employment or work experience that involved payments equalling less than 1 per cent of an MP's annual salary - around £600 - would be exempt.
Everyone from wives, husbands and civil partners to step-children and even ex-partners and nieces could be required to be included on the register.
Party leaders have already encouraged their MPs to be open on the issue - with David Cameron ordering his shadow cabinet to register family members.
But the committee said any new system "is best introduced through the House rather than through individual initiatives".
MPs have been given until next Friday to comment on the proposals before the committee sets out final recommendations.
The Members Estimate Committee has already announced the introduction of tighter checks of MPs' taxpayer-funded expenses from April.
The limit of claims made without a receipt will be cut from £250 to £50.
And it has also agreed to publish its full package of reform proposals by July - months earlier than the original autumn target.