Brown's ally facing World Bank love scandal

The accusation against Tom Scholar, who is tipped for a top job in Downing Street when Mr Brown becomes premier, echoes the one which looks set to cost bank president Paul Wolfowitz his job.

Mr Wolfowitz is said to be negotiating the terms of his departure after a favouritism row involving his partner.

Now the Wall Street Journal has published an e-mail it said was sent to bank bosses last year by an unnamed colleague of Mr Scholar.

It said: "Please know that UK ED (executive director) Tom Scholar is continuing an affair with (a bank employee). ".

"This woman has been given preferential treatment in (the department) because of her relationship with this powerful ED, this affair is well-known, and is in violation of the bank staff rules and the board's standards of conduct."

The newspaper, which has supported Mr Wolfowitz throughout the controversy, said another complaint, possibly from the same person, was filed this week.

It claimed: "Mr Scholar has used his privileged position as an executive director to influence bank staff to manipulate Ms -'s job description in a way to suit her limited professional qualification.

"Without Mr Scholar's intervention she would clearly not occupy her present position.

"Several staff members have reported these facts...these complaints have been ignored."

Mr Scholar, 37, is a member of the board that oversees the work of the bank - and is currently deliberating on the fate of Mr Wolfowitz.

The bank refused to comment on the case but Mr Scholar, who was the Chancellor's private secretary, firmly denied any wrongdoing.

He insisted: "There is no conflict of interest.

"As an executive director, representing my government at the World Bank, rather than a member of staff or management, I do not have any supervisory responsibility for bank staff beyond the five in my immediate office.

"I am not the supervisor of my partner, either directly or indirectly.

"We have never come into professional contact, and I have made arrangements to avoid any possibility of professional contact.

"Since I am not a member of staff or management, I could never be involved in any individual personnel decision affecting her.

"And I have never discussed or made reference to any such issue with anyone who could possibly be involved."

There were suspicions that he may be the victim of a smear campaign by supporters of Mr Wolfowitz, who believe he is being forced out unfairly by European governments.

The former U.S. deputy defence secretary, a close ally of President George Bush and one of the architects of the Iraq war, has been under intense pressure to step down since details emerged of his role in securing a promotion and a large pay rise for his partner, Oxford-educated Shaha Riza, when he became president of the bank in 2005.

There were signs last night that White House support for Mr Wolfowitz is crumbling.

President Bush said: "I know that Paul Wolfowitz has an interest in what is best for the bank.

"I regret that it has come to this right now."