The Deputy Prime Minister today bowed to pressure to enter his stay at an American tycoon's ranch in the House of Commons Register of Members' Interests.
A spokesman for John Prescott announced he had decided to make the entry to ensure there was no doubt that he had "acted at all times with integrity" in his meetings with Philip Anschutz, who is seeking to open a super-casino in the Millennium Dome.
The announcement came shortly after Westminster's sleaze watchdog launched a preliminary inquiry into allegations surrounding the trip to the ranch in Colorado last July.
Standards Commissioner Sir Philip Mawer will write to the DPM asking for his response to claims that the visit may have involved a conflict of interest and should have been entered in the Register of Interests.
Having considered a complaint from shadow culture secretary Hugo Swire, Sir Philip decided there was enough substance to warrant further investigation, a spokeswoman said.
It is only after he has considered Mr Prescott's response that he will decide whether to launch a full inquiry, which could involve calling witnesses, demanding papers or interviewing the DPM face to face.
Mr Prescott yesterday said he did not register his stay on the ranch, accompanied by a number of civil servants, because it was part of an official visit to the US.
Although Mr Anschutz declined an offer of payment for the stay, the Office of the Deputy Prime Minister later made a donation from public funds to a charity of his choice to cover it.
Today, Mr Prescott's spokesman said: "In view of the questions raised and the allegations made about the Deputy Prime Minister's stay at Philip Anschutz's ranch during an official visit to the US, the Deputy Prime Minister does not wish there to be any doubt that he has acted at all times with integrity, and has therefore decided to register the stay by him and his civil servants with the Register of Members' Interests."
Sir Philip's spokeswoman said it was impossible to say at this point whether his inquiries would lead to a report to the Commons Standards and Privileges Committee, which has the power to discipline the DPM by suspending him from the Commons for a number of days if he is found guilty of any wrongdoing.
It was too early to say whether the process would be completed before Parliament breaks up for the summer on July 25, when Mr Prescott is expected to take over responsibility for running the country while Prime Minister Tony Blair goes on holiday.
The spokeswoman said: "Sir Philip has moved to preliminary inquiries now. Having considered the matter, he thinks that there is probably enough substance in the allegation to warrant further investigation and that it may fall into his remit and there is a case to answer.
"He will be in contact with Mr Prescott seeking his response and then he will decide whether to go into a full inquiry."
In a letter to Mr Swire yesterday, Mr Prescott confirmed he had met Mr Anschutz seven times over a three-year period, but firmly rejected any impropriety.
He strongly denied they had discussed the sale of the Dome - which was bought by the Anschutz Entertainment Group in 2002 - or Mr Anschutz's plans to create a super-casino inside the attraction in Greenwich, south London.
"I totally reject the allegations that have been made in the press, and that you repeat, that draw into question the transparency and independence of the decisions made in respect of the Dome or an application for a regional casino," wrote Mr Prescott.
His first meeting with Anschutz did not take place until August 2002 - three months after the minister then responsible for the Dome, Lord Falconer, had concluded the sale, he said.
And he insisted that discussions at the Colorado ranch revolved around their shared interest in William Wilberforce, the anti-slavery MP who previously represented Mr Prescott's Hull constituency.
The affair has caused rumblings of discontent on the Labour backbenches, with one former minister publicly urging Mr Prescott to consider his position.
Vauxhall MP Kate Hoey said the DPM was becoming a "figure of fun" among voters, who no longer believed his denials.
"I just feel he must be at the stage where he is examining his own conscience and thinking is he really the right person to stay in a position which is a big position in Government, the Deputy Prime Minister," she said.
Mr Swire this morning said there was a "bad smell around all this".
He told the BBC Radio 4 Today programme: "Why on earth did the Deputy Prime Minister, the second most powerful political figure in the land, have seven meetings with somebody who wants to bid for the only slot available for a regional casino?
"How many meetings did he have with other people who want that slot? It's the most extraordinary series of events, frankly."
But culture minister Richard Caborn said it was "fundamentally wrong" to say that Mr Prescott would influence the location of proposed casinos.
He said the casino selection process was being undertaken by an independent panel whose recommendations would be subject to parliamentary approval.
He told Today: "This is the most transparent, arms-length-from-Government process."
Mr Caborn said Mr Prescott had meetings with Mr Anschutz "on a number of issues", including William Wilberforce.
Asked about the Deputy Prime Minister's stay at Mr Anschutz's ranch, Mr Caborn added: "This was a weekend between two weeks in which John Prescott was doing official visits in the United States of America."
Downing Street mounted a staunch defence of Mr Prescott today.
Prime Minister Tony Blair's official spokesman said the premier retained full confidence in his deputy.
He went on: "John Prescott fulfils a very valuable role in liaising between members of the Cabinet, in chairing Cabinet committees and in resolving difficult issues which are inter-departmental.
"The experience John Prescott has brought in his time in government gives him a unique role in resolving such matters.
"The important point, as Mr Prescott's office has pointed out, is that Mr Prescott was not involved in deciding the planning application, he's not involved in licensing individual casinos and it is important that you contact potential investors.
"The Prime Minister believes it is important that his ministers meet large investors in this country on a regular basis."Reuse content