Tony Blair's chief personal fundraiser and envoy to the Middle East, the millionaire former record producer Lord Levy, last night emphatically denied any wrongdoing in the cash for honours affair after he was arrested for a second time.

Scotland Yard said it had arrested the peer yesterday, on suspicion of conspiracy to pervert the course of justice, when he returned to a London police station to have his bail terms renewed. He went to the meeting at 10am and was released on bail "pending further inquiries" in the early afternoon without being charged.