A FORMER council chairman has been arrested on suspicion of theft.

Alex Clements, who last week stepped down from his role as chairman of Wear Valley District Council following the claims, was arrested and questioned by police yesterday before being released on bail.

A spokesman for Durham Police said last night: "A 59-year-old man was arrested on suspicion of theft by officers from this force's Economic Crime Unit, based at our headquarters.

"He was taken to Bishop Auckland police station for questioning and, after interview, was released on police bail pending further inquiries.''

An investigation was launched after the district council and Durham County Council raised concerns over cash borrowed from Henknowle Community Association, in Bishop Auckland.

It is believed the undisclosed amount of money has since been paid back to the association.

Councillor Clements' involvement with Playdays, a charity that benefits disabled children, is also being reviewed.

The Labour Party's North branch has suspended him from representing the party until the investigation has been completed.

Coun Clements, who lives in St Helen Auckland, is a well-respected figure in the Bishop Auckland area, having served as a councillor for the Henknowle ward for the past five years.

He is chairman of governors at Henknowle Primary School and took up his post as chairman of Wear Valley District Council in May, after serving last year as its deputy chairman.