The Electoral Commission’s decision to abandon an investigation into Vote Leave’s Brexit campaign could see it face legal action, the BBC reports.
Vote Leave paid £625,000 to settle bills with a Canadian digital agency that were run up by a student campaigner.
But the commission has said there are no grounds to suspect any illegal scheme to avoid the spending limits.
Jo Maugham QC, of the Good Law Project, is seeking judicial review of the decision in the High Court.
The allegations revolve around Darren Grimes, a fashion student at Brighton University during the referendum. Mr Grimes set up the group BeLeave, a platform for young Leave campaigners.
He ran up a bill of £675,315 with Aggregate IQ Data, a Canadian marketing firm, which was paid off by Vote Leave. The latter also spent £2.7m with the same company.
The legal issue centres on the fact Vote Leave would have exceeded its campaign spending limit had it used the money donated on behalf of Mr Grimes itself.
The commission has said this is an “acceptable method of donating under the rules” and that it could only potentially be an offence where there is evidence of a “common plan or arrangement” on how to spend the money.
The watchdog added that campaigners on the same side “can liaise and discuss campaigning approaches without meeting the threshold of joint spending within the meaning of the legislation”.
However, the Good Law Project has said the commission made an “error of law” and that it is “wholly implausible” that Mr Grimes and Vote Leave did not work together.
An Electoral Commission spokesman said: “We can confirm that we have received a letter from lawyers acting on behalf of the Good Law Project.
“We will respond to the letter in accordance with the usual processes. We have no further comment to make.”