A Kingston councillor who stepped down from his party is under investigation for alleged benefit fraud against his own council.

Senior sources on both sides of the political divide said Councillor Tim Dennen was asked to leave the Liberal Democrats in April, after coming under investigation.

Details of the investigation cannot be revealed for legal reasons but, if it goes against him, Coun Dennen could be forced out of Guildhall and face prosecution.

Coun Dennen, now an independent, was backed by former rivals in the Tory party to become chairman of Kingston neighbourhood committee but stepped down a week later. On his decision to quit, Coun Dennen last week said holding the position would be “difficult” given his current situation, though refused to elaborate.

However, sources said the Canbury ward councillor was forced to step down from the committee by council chief executive Bruce McDonald.

The neighbourhood meeting makes and approves decisions on the town centre and as chairman he would have had the casting vote.

Speaking at the meeting to replace Coun Dennen last week, Liberal Democrat councillor Penny Shelton said the Tory decision to install him as chairman was something they “might have come to regret”. Mr McDonald was said to have written to Coun Dennen expressing his anger over his decision to take the high profile job.

Coun Dennen waited five weeks to explain why he stepped down from the Lib Dems back in April, blaming that split on disillusionment at the party’s direction.

In that interview he explained he had recently got married and found work counselling young people, having previously been unemployed.

According to Experian, Coun Dennen was technical engineer of the now dissolved electrical firm Dennen Mastering until April this year, though he has not been a director of the company since 2008. When contacted by the Surrey Comet this week he chose not to comment when questioned about the allegations.

A spokesman for Kingston Council said: “It is not the council’s practice to comment on allegations or rumours relating to individual residents of the borough.”

Coun Dennen won 2,469 votes at the 2010 election, the most of any candidate in the Canbury ward.

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