"No evidence" has been found that Sir Keir Starmer's chief of staff was involved in "any potential offences" over the undeclared donations scandal, the Electoral Commission has said.
The watchdog also said it will not reopen the investigation into the donations made to Labour Together when it was led by Morgan McSweeney.
The group was fined £14,250 in September 2021 over late reporting of around £740,000 of donations after the organisation had reported itself to the Electoral Commission.
The Conservatives had called for a new probe into the handling of donations during Mr McSweeney’s time as Labour Together director, claiming leaked emails showed he had attempted to cover up the late reporting of donations as an administrative error.
But an Electoral Commission spokesman said it had found “no evidence of any other potential offences”.
Mr McSweeney left his role at Labour Together in April 2020 to become a senior aide to Sir Keir in opposition and then in government.
Conservative chairman Kevin Hollinrake urged the commission to launch a new investigation earlier this week, alleging the group had “concocted” a “false excuse of administrative errors” to minimise its penalty and avoid bad publicity.
In a letter to the Electoral Commission, he said the implication of leaked emails reported by the Mail on Sunday was that Labour Together “chose not to report those donations” to stop the then Jeremy Corbyn-led Labour Party knowing “who was bankrolling their secretive political campaigning, and to keep their work below the political radar”.
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Mr McSweeney was director of Labour Together until 2020
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An Electoral Commission spokesperson said: “We have thoroughly reviewed this information and found no evidence of any other potential offences. We are confident that the initial determination and sanction were appropriate.
“We are therefore not reopening the investigation.”
They added that Labour Together’s fine had been “significant” and reflected “the seriousness of the offences determined, for which no reasonable excuse was put forward”.
A Labour Together spokesman previously said it “proactively raised concerns about its own reporting of donations to the Electoral Commission in 2020” and the outcome of the investigation was public knowledge.
The Labour Party described the Conservative's request for a new probe into the donations scandal as a "pathetic and desperate attempt to stay relevant".
A Labour spokesman said: "The Conservatives have zero answers to the challenges faced by working people.
“In a pathetic and desperate attempt to stay relevant, the Tories only hope is to throw mud at the wall and hope something sticks. There isn’t a low that they won’t stoop to.
"They can’t be trusted and they haven’t changed. The Electoral Commission considers this matter closed.
“This Labour government is solely focussed on fixing the mess left by the Tories, and renewing Britain – to make people right across the country better off.”
Conservative chairman Kevin Hollinrake urged Electoral Commission to launch a new investigation earlier this week
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In response to the Tories' calls for a fresh investigation, Deputy Prime Minister David Lammy said he did not believe there was "anything to see here".
"In opposition - 14 years in opposition - Labour Together was one of a group of organisations designed to get the Labour Party back in the groove with the British people and positioned to win once more and Labour Together was integral in achieving," he told Times Radio.
“I’m not surprised that the Tories are muck-raking. I’m not surprised that they’re attempting to destabilise an organisation that played that role.
“But I really don’t believe that there’s anything to see here.
"And certainly my contact with Labour Together was really about policy that would set us up to win the General Election, as we went on to do.”
Speaking to GB News yesterday, Work and Pensions Secretary Pat McFadden said: "I'm not surprised that political opponents are trying to attack Morgan McSweeney, he is very effective and he was a big part of Labour's election victory last year."
He added that the Labour party had "a lot to be thankful to him for".