Embattled Labor MP Craig Thomson can take cold comfort that sleaze alone is not enough to have him kicked out of Parliament.

While an uppity independent or rogue Kevin Rudd have been considered the main threats to Julia Gillard's hold on power, the prospect of a by-election in Mr Thomson's seat has Labor figures on edge.

The seeds were sown before Labor stormed into office in 2007, when Mr Thomson won the marginal NSW seat of Dobell.

Before that, Mr Thomson was national secretary of the Health Services Union.

The Sydney Morning Herald reported in April 2009 that an audit of the union found more than $101,000 in cash advances had been made on a union credit card issued to Mr Thomson. The card was also used to hire prostitutes and help bankroll his election campaign.

Mr Thomson denied any wrongdoing and sued Fairfax for defamation. But the MP dropped the case this year and Fairfax stands by its report.

The legal action proved costly, with the Labor Party scrambling to cover at least $90,000 in legal bills to avoid Mr Thomson being declared bankrupt, which would have disqualified him from Parliament - triggering a by-election the Government would likely lose in the current climate.

Mr Thomson admitted this month that as union secretary he authorised all credit card bills but was unaware they included payments for sex.

He claims an unnamed former HSU employee racked up the prostitution bills and later repaid $15,000.

But this does not explain how two calls were made from Mr Thomson's mobile phone to an escort agency, how the agency got his driver's licence number as proof of identity and how the credit card voucher had a signature bearing an uncanny resemblance to his.

The Opposition wants prosecutors to investigate Mr Thomson for either fraudulently using the credit card for sex or covering up a fraud by someone else.

The police are not investigating but the industrial umpire, now known as Fair Work Australia, has been scrutinising the union's books under Mr Thomson's reign.

Prime Minister Julia Gillard has expressed full confidence in Mr Thomson.

The West Australian

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