Nigel Farage is facing questions about why he claimed his finances were the subject of a second standards investigation, as he was sworn in again as Clacton’s MP.

The Reform UK leader said when he resigned in July that the standards system had become a “political tool” because “yet another standards investigation is under way” into his finances.

He argued he wanted the people of Clacton to be the judge of his actions, rather than “the establishment”, after revelations in the Sunday Times that his friend and convicted fraudster George Cottrell had paid for social media work, accommodation and security before the 2024 election.

However, it is understood the parliamentary standards commissioner had not launched another investigation or widened the scope of the existing one at that point.

The commissioner is believed still not to have decided whether to widen the inquiry as recently as two weeks ago, when it was reopened as Farage was returned as MP for Clacton with an increased majority.

The commissioner launched his first investigation in May into Farage’s £5m gift from the Thailand-based donor Christopher Harborne before the 2024 election, which was not declared on the MPs’ register of interests and was first revealed by the Guardian. Initially Farage said the money was given to pay for his security, then he described it as a reward for campaigning for Brexit.

At least two complaints were then submitted in July about Farage’s funding by Cottrell. Farage called a byelection on 7 July and the initial investigation was paused.

However, Westminster sources said the standards commissioner was assessing information. There is no official confirmation that he has widened his inquiry to include the Cottrell donations, and the commissioner’s list of investigations currently only includes the one launched in May.

The sources said the commissioner wanted to see further evidence that Farage had broken the rules in relation to donations from Cottrell in the year before the 2024 election, including his payments for social media work.

Farage has maintained the videos were personal and likened his public role before that election to the work of an influencer. However, a number of the videos were political in nature, campaigning on immigration issues.

Critics say these should be declared under rules that say donations related to politics must be registered in the 12 months before an MP is elected.

The standards commissioner declined to comment on the status of the investigation into Farage and whether any decision had been made on widening the inquiry.

If there is no second investigation nor a widened scope, it is possible the first investigation into Farage could conclude sooner than expected. The Times reported in July that the Reform leader would be interviewed within weeks but the byelection paused the process.

In relation to the investigation, Alex Burghart, the shadow chancellor of the duchy of Lancaster, said: “The questions surrounding Nigel Farage’s £5m gift from Christopher Harborne and the donations from George Cottrell simply aren’t going away.

“Farage has already tried to run away with his farcical byelection in Clacton, but he can no longer hide from these questions. He needs to come clean … The public deserves answers and Farage can’t keep hiding.”

If the standards commissioner finds a breach of the rules, and the separate standards committee of MPs recommends a sanction of more than 10 days of suspension from parliament, Farage could end up facing a second byelection.

As he was sworn in again on Tuesday, Farage told GB News that he planned to spend less time in parliament and would be leaving more Westminster work to [the Reform deputy leader] “Richard Tice and the gang” while he goes on a tour of the country.

Farage will set his priorities for the year ahead when he gives his speech at the Reform party conference at the end of this week, where he is expected to attempt to draw a line under the focus on his finances.