West Yorkshire detectives have been called in to investigate a fraud scandal at a flagship Bradford free school.

Senior officers in Bradford believe there are grounds to carry out a criminal inquiry into financial failings at Kings Science Academy.

West Yorkshire Police stepped in yesterday after the force was asked to investigate the findings of financial failings at the school which were uncovered in a detailed audit by the Department for Education.

The decision, by the National Fraud Intelligence Bureau, to refer the matter to West Yorkshire Police for investigation followed pressure from Bradford MPs David Ward and George Galloway for a “proper inquiry”.

DfE auditors had been called in to examine the books of the academy, which is in Lidget Green, Bradford, after concerns were raised by a whsitleblower about the way it was being run.

The investigators found a series of major failings in the school’s financial controls, with almost £77,000 of start-up grants alleged to have not been used for its intended purpose.

The auditors found incorrect payments had been made to the academy’s principal, Sajid Hussain Raza; an unexplained expenses payment of £5,612 was paid to a governor; and the school was found to have paid for the refurbishment of a property owned by a company of which Mr Raza is a director and his father a trustee.

Bradford East MP David Ward and Bradford West MP George Galloway accused the DfE of “misleading” statements that the police had “decided no further action was necessary” at the academy, and called for a thorough police investigation.

The DfE yesterday responded, claiming: “These MPs are wrong. Fraud cases are now reported directly to Action Fraud (the national fraud reporting mechanism) – not local police forces.

“For completeness, we also alerted West Yorkshire Police, which in turn directed us to Action Fraud. The case was then passed to police at the National Fraud Intelligence Bureau to investigate, which decided no further action was required.”

But yesterday the Bureau did take action, by referring the case to West Yorkshire Police.

A West Yorkshire Police spokesman said: “The Department for Education reported the matter to Action Fraud on April 25 this year. It was recorded as an information only case not as a crime. This was not sent to West Yorkshire Police, either as information or for investigation.

“The National Fraud Intelligence Bureau has now assessed the report in line with nationally agreed protocols and have today sent it for investigation by West Yorkshire Police.”

Last night Mr Galloway (Respect) welcomed the police investigation, but said the question remained as to why it had taken pressure from MPs and the Press for action to be taken.

Mr Ward (Lib Dem) said: “I belatedly welcome the fact that the police are now involved. We are not talking about allegations and rumours, we are talking about admissions of falsifying claims and fabricating invoices.”