The Labour party's chief fundraiser was today under pressure to quit after he became embroiled in the secret donor sleaze row.

The Labour party's chief fundraiser was today under pressure to quit after he became embroiled in the secret donor sleaze row.

Jon Mendelsohn - who was brought in by Gordon Brown to fund the general election - is alleged to have been informed of the proxy donations and told it was a long-standing arrangement.

Shadow Chancellor George Osborne said: "If Jon Mendelsohn - this is Gordon Brown's personal fundraiser, the man he brought in to fund the general election - actually knew about this last month, then he was party to something which was unacceptable and unlawful and I can't possibly see how this man stays in post beyond today."

The latest disclosures threatened to undermine Mr Brown's attempts to limit the damage following the resignation on Monday of party general secretary Peter Watt.

Harriet Harman is under pressure to give further details about a controversial £5000 gift to her campaign for Labour's deputy leadership.

As the Electoral Commission, which is investigating whether David Abrahams's donations breached the 2000 Elections Act, confirmed it had been "in touch" with the Crown Prosecution Service, the Prime Minister condemned the use of proxy donors as "completely unacceptable" and insisted the £650,000 in gifts would be repaid.

Further questions were raised for the party as Mr Abrahams, the property developer, later revealed that he had received a letter from Labour's chief fundraiser, Jon Mendelsohn, which hailed him as one of the party's "strongest supporters".

The news will bring further speculation that other senior figures apart from former General Secretary Peter Watt were aware of the practice of using intermediaries to channel donations.

Speaking on BBC2's Newsnight, Mr Abrahams read out the text of the hand-written message from the director of general election resources asking to meet him to discuss the party's allocation of "resources".

According to Mr Abrahams, the letter said: "I know your diary is very busy, but as one of the party's strongest supporters it is only right that you are kept informed with what we are doing and the priorities that we are assigning to our resources."

Ms Harman, who is giving back the £5000, received it from Janet Kidd, one of three known intermediaries used by Mr Abrahams to give Labour the huge donations.

The Commons Leader, who won the deputy leadership contest, insisted she had "no reason to believe" the £5000 had come from anyone other than Ms Kidd.

However, Ms Harman appeared highly exposed because the Prime Minister and her fellow deputy leadership contender, Hilary Benn, the Environment Secretary, revealed they had turned down similar campaign donations from Ms Kidd because she was unknown to them. At his monthly Downing Street press conference, Mr Brown was repeatedly asked to say if he had "full confidence" in Ms Harman but failed to do so several times.

Hours later, his spokesman declared: "He has full confidence in Harriet Harman."

Last night, the Conservatives appeared to be gunning for Mr Brown's deputy, claiming her statement was riddled with "inconsistencies" and demanding she make a full Commons statement. Vince Cable, acting Liberal Democrat leader, said "an enormous can of worms had been opened up" and Ms Harman had "a lot of questions to answer... the issue about why she accepted money that Hilary Benn and Gordon Brown had refused".

Chris Grayling, the Tories' Shadow Pensions Secretary, said the Prime Minister appeared to have "hung his own deputy out to dry".

At No 10, Mr Brown condemned the use of proxy donors as "completely unacceptable", stressing the £650,000 would be repaid. The Electoral Commission, meanwhile, confirmed it had been in contact with the Crown Prosecution Service, which will ultimately determine whether to bring criminal charges.