The investigation by the Department for Education into the alleged takeover of state schools in Birmingham by Islamists has been expanded to examine possible financial mismanagement and profiteering.
Peter Clarke, a former head of counterterrorism at Scotland Yard who was chosen to lead the inquiry by the education secretary Michael Gove, is understood to be looking at links between education service providers and Birmingham city council.
A Whitehall official said Clarke was also examining allegations of nepotism and conflicts of interest.
Tahir Alam, the chairman of governors at Park View School, which is at the centre of the so-called Operation Trojan Horse controversy, is believed to be among those being scrutinised.
Alam has consistently denied any wrongdoing and believes the Trojan Horse affair is politically motivated.
The Whitehall source said: “Clarke will certainly be addressing all issues raised by staff from the schools under investigation in Birmingham and that will not be limited to problems relating to fundamentalist Islamic practices.
“He will be looking at any allegations relating to financial mismanagement, conflict of interest, nepotism and profiteering. He’s not going to hold back on anything.”
A source close to Birmingham city council, which is conducting its own investigation into Trojan Horse, a document purporting to be a blueprint for how Muslims could wrest control of schools, said Clarke was investigating whether “one of the reasons for the alleged takeover … by governors was financial rather than religious”.
As well as his role with Park View, Alam helped to set up Bordesley Birmingham Trust (BBT) in 2011. It cited its aim as encouraging and advancing learning for children.
Les Lawrence, a former Tory cabinet member for education at the council and the husband of Chris Keates, general secretary of the NASUWT teaching union, later joined BBT as a director. However, he did not declare his interest in it for the six months when he was also a councillor before losing his seat in 2012.
Alam was last year commissioned by the council to provide courses for governors.
Birmingham city council said: “There is no record of this company [BBT] on the register of interests for Les Lawrence from when he was a councillor. We have commissioned some training courses from Tahir Alam as an individual in the past but there are no courses currently booked.”
BBT is now dormant. Lawrence did not respond to a request for comment.
The developments come as Khalid Mahmood, Labour MP for Birmingham Perry Barr, demanded details about more than £500,000 raised by the Park View Educational Trust, which is headed by Alam, and which appears on its accounts.
Mahmood said: “The money was raised by the Park View trust but they are not giving details of where the donations came from, when the fundraisers were held and who they were held by.”
The trust, which declined to comment, runs three of the 21 schools being investigated by Ofsted, the education watchdog, after claims strict Islamic practices were being imposed.
The publication of the Ofsted inspection reports is expected next month. It is understood at least six schools will be placed in special measures that could lead to the removal of their governors.
Clarke is expected to publish his findings in late July.
Meanwhile, Alam is closing down the Muslim Parents Association, a not-for-profit organisation. A proposal to strike out its registration has been lodged at Companies House.
Alam also recently resigned from Washwood Heath Academy, one of the schools investigated by Ofsted which is expected to be given a clean bill of health.
Asked about Bordesley Birmingham Trust, Alam referred The Sunday Times to its records at Companies House. He declined to comment further on BBT or other matters.